By Barry Janoff
January 5, 2016: The Ultimate Fighting Championship was formed in 1993 as a pro mixed martial arts group, and in 2001 was acquired by Frank Fertitta III, his brother Lorenzo Fertitta and Dana White (pictured below) for about $2 million. UFC, under the corporate auspices of Zuffa LLC, now produces more than 40 live events annually and is broadcast via PPV and TV, including Fox, in more than 129 countries and territories in 28 different languages.
Although the UFC has had its share of champions, it arguably is the rise of Ronda Rousey — and this past November her first UFC loss, at the hands and feet of Holly Holm — that drove awareness beyond core fans to casual fans and non-endemic brands and consumers. A rematch, currently planned for July, could be the biggest fight of the year, including UFC, MMA and pro boxing.
Thanks in large part to Rousey and McGregor, the UFC generated a record $600 million in revenue for 2015, Lorenzo Fertitta told CNN Money, which he said was "fairly significant growth coming off of 2014."
UFC's nucleus of partners currently includes Anheuser-Busch, Reebok, Toyo Tires, Topps and EA Sports, which in March is scheduled to release UFC 2 (with multi-media marketing, "Finish the Fight," pictured below).
Rousey certainly has risen above the ranks of other UFC fighters on Madison Avenue. Her roster of marketing partners includes Reebok, Monster Energy, Carl’s Jr., Snail Games, Buffalo Clothing and Monster headphones. She has some two million followers on Twitter, ten million likes on Facebook. She has done movies and plans to do more. On Jan. 23, she is scheduled to host Saturday Night Live on NBC.
On the men's side, among the UFC's top stars are Chris Weidman, Anthony Johnson, Michael Bisping, Victor Belfort, Jon Jones, Robbie Lawler and Conor McGregor (who earlier this month needed just 13 seconds to knock out José Aldo to claim the featherweight crown).
UFC is in the process of growing beyond the Octagon where the fights actually take place into UFC GYM, which since debuting in 2009 has opened more than 135 locations in the U.S., Australia and Canada, with more than 50 gyms expected to open in the next year; clothing boosted by its alliance with Reebok, multi-media and other outlets. The UFC recently broke ground on a planned 184,000 square foot facility in its Las Vegas hometown that will be anchored by a UFC Athlete Health and Performance Center.
Garry Cook joined UFC in September 2012 and in 2014 was named as Chief Global Brand Officer, overseeing the organization’s global brand direction, international business development, corporate and social responsibility, athlete marketing and development, along with fan engagement experiences.
NYSportsJournalism spoke with Cook, who before joining UFC held executive positions with Nike and Manchester City, about the past, present and future growth and challenges facing UFC.
NYSportsJournalism.com: How would you assess the UFC's attraction for fans and brands in the past and how you are doing that now?
Garry Cook: At one time people thought this was a fad. This is not a fad. When you consider that we have more than 18 million Facebook Likes, almost three million followers on Twitter, other places where people interact with us, we have a huge global audience. And what we have found is that the majority of that audience have come for the purpose of watching a combat sport. That's the core audience: The MMA fan who goes to MMA Junkie, Bloody Elbow. They want to know about the rankings, the match-ups. But to be a big global business, we have to grow outside of that.
NYSJ: How do you extend your brand to a broader audience?
GC: The next segment is talking to sports fans. They understand adversity. They understand the joys and sorrows of winning and losing, respectively. They are an emotional crowd. We also understand that they want to be there at that defining moment when something big happens: Whether it's a Tom Brady pass to win a game, a Tiger Woods putt to win a match. That's what we have become and what we want to build on. We are a premium brand, we are electric, we create lightning-in-a-bottle moments. That's what the sports fan can connect with.
They also can connect through our verticals: Our UFC GYM, where we have 130,000 members. We plan to have 1,000 locations worldwide by 2020. That's a place where you can go to train, to be aspiring, to be as big as our fighters. But it's not about learning how to fight or learning how to wrestle. It's about health and wellness. We see a big uptake in females in our classes.
NYSJ: What about the casual-fan segment?
GC: When you look to the casual fans, these fans know about UFC but not all the particulars, and it may have been Ronda Rousey who changed their knowledge and landscape. So what we need to develop as a company is an emotional connection that is not related to fighting. Or if it is a connection to fighting, we redefine the word 'fighting.' So we've created a social responsibility platform and agenda that says, We are all fighters. At the fight in December when Chris Weidman was defending his world middleweight title (which he lost to Luke Rockhold), there was a young fan in attendance who came out with Weidman. He was in a wheelchair, battling cerebral palsy and cancer. He's a fighter.
NYSJ: Where beyond the U.S. do you see the biggest potential for growth?
GC: In the U.S. we have our own growing subscription network, UFC Fight Pass. If you look at Brazil, we have a high penetration. We have a TV subscription network with more than 500,000 subscribers. Even with the economic challenges there, we have grown 20% over the past year. We have an agreement in Mexico with a network that puts us in 18 countries. Russia is a huge area with potential that for us is still untapped. In China, we recently formed a relationship with a digital provider, which will help us grow in that nation and in the Asia region.
NYSJ: Are you seeing results from international ventures?
GC: We have invested in people in our international offices, we have invested in our fighters and all of the intrinsic valuable resources akin to fighters, and we continue to invest in operating expediters. All of that is starting to show returns. So as we have many more reference points than our fighters. We recently held an event in London but didn't say who would be fighting. Just that it was a UFC event. We sold out the venue, 20,000 tickets, in 25 minutes. And someone said to me, You sold out faster than Justin Bieber and Justin Timberlake.
NYSJ: What are the challenges you deal with growing internationally?
GC: At headquarters, you should be developing a global process, global strategy, global aesthetics and global consistency. McDonald's, Coca-Cola, Apple do it magnificently. But what you also must do is be relevant to the local culture. If you are in Brazil, for example, and you are watching a local broadcast and it says 'Brought to you by Fox,' that's not locally relevant. It's about language, storytelling, authenticity, relevance to the local culture.
We find in globalization brands is that if you are based in New York, you tend to have a cosmopolitan view of the world. But if you are based in Las Vegas, as we are, which is an entertainment capital with hotels and casinos, it's not the epicenter of commerce for the world like a London, New York or Tokyo. So we nave to be careful to avoid not just a U.S. myopic, but a Vegas myopic, which is a different reality. So we have to develop a brand process and strategy for the rest of the world.
NYSJ: How are you working with your marketing partners to expand domestically and globally?
GC: When it comes to Reebok and their products, Russia is their third-largest market. And Russia is big for EA Sports. So when I heard that, I said to Lorenzo, We might want to look at Russia and the growth and opportunities there. So Russia and China are big for us as far at potential and growth, not by coincidence the same two nations at which the NBA is building and investing. People in China love Western brands, whether it's EA or Reebok.
NYSJ: Signing a six-year deal with Reebok in late 2014 was a major move. Have you been able to see the results from and the future prospects of that alliance?
GC: Before we entered into that relationship, we were committed to building a system that would reward the fighters and finding a global supplier that could distribute UFC products — they have 3,000 Reebok outlets in Europe and 7,000 worldwide — and would give us access to consumers. We had a T-shirt business, but they were committed to building it out and creating a new silhouette that is now our game-day jersey, creating a cottage industry to attract not just UFC fans but people into health and fitness, which is core to both UFC and Reebok. We've seen a general over-sale on all the products at retail. They also have invested in the U.S. in Fight Shops, which is a store-within-a-store concept.
NYSJ: How important is authenticity to your core audience?
GC: That is most important. And it all starts with the fighters. When you talk about authenticity, that is the one true fundamental that we have. We have eight maxims at UFC. Maxim No. 1 is that we promote human potential, not fights. Maxim No. 8 is that, in life, we are all fighters. But the one I love the most is Maxim No. 4: The fans decide. When it comes to our matchmaking capabilities, it is the fans who determine what they want to see. We don't contrive any of that. We have the best fighters go into the octagon against the best fighters, we close the gate and we have no idea what the outcome is going to be. With Conor McGregor, it took 13 seconds. That where the rawness, excitement and authenticity really stems from. We'll never change that.
But then when we want to speak to the casual fan, we can talk about where the fighters are from, what is their backstory, how dedicated they are to the sport and how hard they work to get in shape and stay fit. That speaks to a broader audience and does not take the place of what the core audience wants.
NYSJ: Taking that into marketing, is the challenge to appeal to more non-endemic brands and partners but still have them remain authentic to the what the UFC is about?
GC: We are with Anheuser-Busch, Reebok, EA, Monster. The next step is how do we leverage those relationships to build and grow and engage with our audience There are categories that we are not in. The challenge is that we have to define who we are and not have others define what they want us to be. So when you have conversations with people, and I've had lots of them with people around the world, when you listen to their reference points about who we are, I have to say, That's not who we are. That's not what we do.
If you look at the big spaces, the quick-service retail sector is not covered. We don't have a burger partner. And yet, we have that demographic covered. We don't have a car partner, but we have that demographic. if you look at the big picture, we don't have a quick-serve partner, we don't have pizza, we don't have a burger deal. And yet, we have (their) target demographic. We did have Ford, but for now we don't have a car deal, and, again, we have a target demographic.
NYSJ: Is this by choice or does the landscape have to change before some non-endemic companies want to partner new the UFC?
GC: We had Ford and it worked well. Here's the interesting thing: One of the challenges we have is that the days of slapping a logo on the canvas and hoping to create awareness and sales are gone. So with Anheuser-Busch Budweiser, they have an agreement with us, but they don't actually put our logo on their product. They activate at retail. So we have to change our cultural mentality and move to more of an engagement platform and not just have a logo on the canvas. But you have to find ways to engage with companies to help them sell their product. It's not just about the logo. It's about engaging the consumer and getting them to take the steps from seeing the product associated with UFC to then going out and purchasing the product or using the service, as the case may be.
Our challenge is that we are a media content company, a broadcast content company. But when we have our deals with networks, they own their own rights to sell commercial partnerships and sponsorships around our events. And they seem to do very well in categories such as quick-serve restaurants, autos, financial. Their commercial partners can say we are going to surround ourselves with the UFC audience but we don't have to be intrinsically attached to the UFC. But we are making progress. Once upon a time (our sponsors were) Fred's Painting and Decorating; now it's Anheuser-Busch, Fortune 500 companies. That's the dynamic change that we are going through.
NYSJ: UFC demographic skews heavily male, 18-24. It seems as if Ronda Rousey attracts a male audience, but have you seen more women watching because of her and Holly Holm?
GC: Part of the challenge, and one that I see that we are winning, is getting people to see it as a match between two top fighters, not two women. Rousey does attract a male audience. But we are finding that the female demographic is rising. When it comes to the UFC attracting a dual audience, when they come in, we have to enable them to have something to which they can reference, relate. People are intrigued with Ronda Rousey; she has changed the landscape. So when women come in and start to watch, they also engage with the MMA and the MMA audience. They see more than the fights, they see the fitness, the dedication.
NYSJ: Sitting here now with people talking about a potential Rousey-Holm bout some six months out in July, would UFC have envisioned that ten years ago?
GC: That's what happened in boxing, with people anticipating the best fighters facing each other. But we have fighters in their prime, facing each other when people want to see them. We have so many of those fear of missing out moments. We have filed in all the gaps that boxing fans wanted. We have a centralized world title process. We have a brand, so you can access other elements. And it doesn't take seven years to put a fight together, as it did with Floyd Mayweather and Manny Pacquaio. We do it every week. It is quite a compelling model.
NYSJ: Moving forward, what do you see for UFC and what will you be taking from your experiences at Nike, ManCity and elsewhere to help grow the brand and sport?
GC: We are enjoying the spoils of our hard work and our investments. What that also means is adding more team members and players, adding more dimensions around digital marketing, content marketing, social media marketing and planning. It is very different today from how we did things in the past.
The number one thing for me is people. We live in a world of organization, and we have to make sure it is efficient and effective. In the old days, you had to be a lawyer, consultant or an accountant. Today, you have to be a people leader. Brands and businesses don't make decisions — people do. I'm a great believer in that. I learned that at Nike. Phil Knight (Nike founder) said he would rather sit in a room with ten 'average' people who come up with one genius idea than one genius trying to tell the other nine about his idea. I love that. It's a principle by which I live and work.
We are learning as we are building. At the UFC, I use the mantra from Marshall Goldsmith's book, What Got You Here Won't Get You There (How Successful People Become Even More Successful). When we talk about getting there, we have to be a better UFC today and tomorrow than we were yesterday. And we expect to deliver on that for our athletes, fans and partners.
It's Official: UFC's Ronda Rousey Is A Monster
Back to Home Page