Since being purchased by Lorenzo and Frank Fertitta in January 2001 the Ultimate Fighting Championship (UFC) has been on a constant ascension and is slowly making its way into the sports mainstream in the United States.
The UFC ownership is made up of billionaire brothers Lorenzo and Frank Fertitta (each own 45 percent) and high-school buddy Dana White (owns the remaining 10 percent). Since day one, White has been in charge of the day-to-day operations as the companies President while the Fertittas have been strictly focused on their Station Casinos, Inc. business operation.
In the seven plus years Dana White has been at the helm he has turned the UFC into the biggest mixed martial arts organization on the planet.
According to the recent article "Ultimate Cash Machine" by Matthew Miller in Forbes Magazine, the Fertittas paid $2 million for the UFC in 2001 and the current value of the organization is near $1 billion.
Miller goes on to state that in 2001 the number of pay-per-view buys was near 145,000 and in 2007 that number ballooned to a staggering 5.1 million.
This is unprecedented growth for a sports organization is such a relatively small time frame. The fact of the matter is that this type of exponential increase in viewership and in overall value will be extremely hard to maintain going forward for years to come. There has to be a plateau at some point to consider.
The UFC already has large sponsorship deals with Budweiser and Harley Davidson. They have the majority of the best MMA fighters in the world on their payroll. They also have the best production of events in all of MMA.
So how will the UFC be able to sustain growth and continue to expand their business? The answer is simple. Attack the overseas markets and aggressively take their product worldwide.
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2 months ago
Nice article, maybe next time you could post it all here and link at the bottom to the source instead of linking halfway through.
from 2 months ago
I would if I could. Thanks.
2 months ago
op notch article. Like many others, I am waiting for the UFC to conquer the world.
from 2 months ago
Thanks for reading as always dorothy!
2 months ago
"Attack the overseas markets and aggressively take their product worldwide. " from a dollars standpoint theres a number of things that can sink a business and you mentioned one. Spending millions of dollars to go overseas could be a financial blackhole, especially in asia where a different mindset plus national pride influences the popularity of MMA. It would take a lot of research to figure out how the UFC could gain crossover appeal. Maybe a mixed MMA tournament would be a good start. Dream vs UFC or something.
from 2 months ago
It could be a pitfall but it appears like they are being cautious up to this point. They have already been successful in Europe but seem to be hesitant going into the Asian market at this time. It remains to be seen if they can tailor their product to the Asian markets.
I think south america is almost a definite expansion location with the number of fighters they already have on their payroll from that area of the globe.
Also, I cannot see the UFC ever putting on any type of tournaments, especially not a co-promoted tournament.
2 months ago
Great article, but you forgot a major point.
The UFC is looking to expand in other European countries, Dubai in the Middle East (huge live event money market), Asia, South American etc. For this expansion to occur the UFC needs to not only make inroads to acquiring fighters from these markets but also to secure distribution on the major networks or PPV services in these locations. Those negotiations require the sophistication of a business man, not the in your face take it or leave it personality of Dana White.
In a place like Dubai you're likely to deal with royalty on some level to secure a location to hold the event, to broadcast said event, etc. The cultural aspect is a huge hurdle to get over and you need to have polished etiquette, an understanding of how to do with the super rich (obviously learned from the casino business & the fact that Lorenzo is also a billionaire), and the posture of standing on equal footing, which as a multibillion dollar business owner, Lorenzo certainly has.
Dana White is great for hyping events, dealing with fighters, and overseeing production aspects of the show. His bullheaded brash nature makes him a star in his own right but it doesn't translate well in other countries where things are simply different.
from 2 months ago
Nate, I love the way you summed this up!
from 2 months ago
Nate -
You might not have clicked on the link. I did go on to say that they are pursuing options in places like Brazil, Japan, the Phillipines, Germany, etc... and that they've had success already the 6 times they have been to Europe and Canada since the 2001 purchase.
And yes, the network rights in these countries are key. They did secure a TV deal with Mexico's Galavision this year which will be great.
I think we both agree that Lorenzo is the man for the job though.
Appreciate the feedback.
from 2 months ago
Well said, and extremely accurate depiction of White. Its a reason I like him, but in aspects of world business hes like a bull in a china shop. The UFC would do well to hire an over seas marketing executive with background in a similar area.
2 months ago
I dont see much from Bodog anymore but one thing I liked about their promotion was the exotic locations they fought at. One place it was a beachfront, another was Russian palace. Very cool way top put their fights out there. I really liked it. It was like a street fighter video game or something. The UFC is too big and draws too large a crowd for something like that but it just came to mind when reading about taking it overseas. It was fun to watch.
2 months ago
There is still much growth potential in the U.S.
UFC has come a long way, but what if the NFL wasn't even legal in some states?
Dana will probably continue to grow this, the largest market.
2 months ago
The only problem I have with this article is that Canada, contrary to popular belief, is not overseas. Lol. :) Fantastic article Derek. I like actually learning new stuff when I read these articles.
from 2 months ago
Haha my bad honest mistake. My geography isn't really that bad. I just fixed it. Thanks.
2 months ago
Nice article Derek.. i love the thought that they are looking into the Phils.. One of the manifestations that they really are interested branching out in the Phils is the coming of Chuck Liddell here tomorrow.. hehehe I cant wait to see Chuck, although coming from a 1-3 W-L, hey its still the ICEMAN!!!
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