Ring of sports marketing

Jeff Garrett is a graduate of the Clark Honors College and Honors Business Program at the University of Oregon with experience in sports/event marketing, digital media, strategy and consulting.

[jeffcgarrett]

UFC Makes UFC 200 Promo For Adult Swim

In promoting UFC 200 taking place on July 9th the UFC has made ad buys on Comedy Central during “Adult Swim.”  It is more branded content than straight commercial and brings back King of the Hill’s Hank Hill and George Liquor from the Ren & Stimpy show.

The main reason for the buy is not only Dana White’s affection for Adult Swim but also the clear alignment of demographics.  People who watch Adult Swim are the same type of people who like the UFC.  

From the article on Adweek:

"The way the pay-per-view market works for us, we give them a spot and then they circulate it through all the cable channels. But our spots are never on Adult Swim," said White. "Comic-Con is huge, and that demo is a very loyal fan base and hardcore, much like ours. We'd never had a presence on this network that is so strong with this young demographic."

White reached out to Judge about creating an animated short, and Judge tapped friend and fellow UFC fan Kricfalusi. The spots took more than a year to create due to the red tape required to clear the rights to use Hank Hill (which is owned by Fox) and George Liquor, and getting Adult Swim on board. "They're into funky, crazy new shit, and they were so supportive of this thing," said White of the network.

Ringside Analysis:

The UFC is fully committed to marketing to the core fan.  Almost every marketing effort is designed to attract men between the ages of 18 and 34 with an African-American ethnicity.  Basic marketing is that you market to the people who are most likely to buy your product, not to persuade non-buyers to suddenly purchase your product or service.  

One of the genius parts of this spot is that it doesn’t show knockouts or the kind of footage that people who aren’t necessarily already fans of the UFC characterize as “goofy” and “weird” and actually end up deterring them.  Creating an advertisement that doesn’t follow the usual images and messaging is a great move and I’m sure will end up being a huge success for the UFC. 

[jeffcgarrett]

“So pumped to announce that I've officially signed with @Reebok. #TeamReebok”

Sage Northcutt Signs Sponsorship Deal With Reebok

Reebok has signed another UFC athlete to it’s roster.  The newest addition is 20-year old Sage Northcutt.  Sage Northcutt is a potential marketing phenom given his Mr. Touchdown USA looks and extensive athletic success.

Northcutt has won 77 world championships in karate and is an undefeated kickboxer.  

With a 7-0 record Northcutt entered into a fighter against Bryan Barberena at UFC on Fox on January 30th of 2016.  He was submitted in the second round with a widely criticized tapout because of it’s considered weakness of a choke.

Northcutt will be fighting at UFC 200. 

Ringside Analysis:

Reebok is buying early on Sage Northcutt.  Northcutt has a lot of potential in the octagon as a fighter and outside the octagon as a marketing figure.  

The official apparel provider of the UFC has struggled creating products of the highest quality for UFC fighters but has steadily built a stable of top fighters and marketable figures.  Reebok will be debuting new kits at International Fight Week.

Sage Northcutt might be going through growing pains now as he continues to gain experience.  This is a deal for the long-term and could pay off pretty well for Reebok.

[jeffcgarrett]

Valeire “Trouble” Letourneau Takes Commentators’ Criticism Over Chest Kicks Personally

Letourneau fought Joanne Calderwood and came away with a loss.  The real story for Letourneau is the criticisms from commenters that she struggled with getting kicks to her chest.  During the fight Letourneau would cover her chest after a kick and look to the ref to call a break.  According to her, the issues was with Reebok clothing.

From her instagram post:

I want to clarify something, my daughter told me what the commentators were saying during the fight, and I felt insulted. I have been practicing martial arts for 17 years, so I have no problem taking hits to the chest. It is the rule, and it isn't worse than a low kick! My only problem during the fight is that my bra litterally slipped under my breasts. This is why I stared, embarrassed, at the referee, and I have no idea what Jojo told me, but I had to keep fighting. It seems that I was being mocked because I seemed to be complaining of blows to the breast. I think that I have nothing to prove regarding the numbers of hits I can take without complaining. Guys, would you be able to keep fighting without being distracted if one of your nuts was slipping out of your shorts? Anyway, it does not excuse my defeat, but I wanted to clarify this part of the fight!

Ringside Analysis:

Reebok has seemed to struggle upholding their end of the partnership with the UFC.  They have struggled with creating accurate shirts, using clip art for shirts, and this is just the most recent example of fighters complaining about the fit and quality of the fight apparel.  

The starting point for Reebok to become more successful is to better its quality.  For example, when Nike is selling its products the company customizes each product for one of their top athletes and can meet the specific need of an athlete.  Imagine if Tom Brady starts complaining about Under Armour shoes or Derrick Rose says his shoes hurt during games.  From a PR standpoint critiques by athletes is the first thing that needs to change.  

I also think that the shirts should probably look more like sleeveless surfing rash guards.  I don’t believe that these changes are that difficult to make and could go a long way.  

[jeffcgarrett]

Ex-Golden Boy CEO Richard Schaefer back in the boxing business with Ringstar Promotions

Schaefer built Golden Boy into a promotional powerhouse

Richard Schaefer Returns To Fight Game With Ringstar Promotions

Richard Schaefer who previously was the CEO of Golden Boy Promotions has returned to the boxing business.  A few weeks ago he established the company Ringstar Sports.

Schaefer had to take a break that expired in 2015 from the sport resulting from a settlement with Oscar De La Hoya at Golden Boy who sued Schaefer for $50 million for breach of fiduciary duties.

Schaefer said to USA Today:

I could have come back then, but I really wanted to take my time and do things right.  The next order of business is to go and recruit the best team. I want to have the best team in boxing again, from matchmakers to operational staff, marketing staff and foreign sales.

At the same time, I want to start to have some conversations with TV networks as well. Once I have a team and sponsors and networks lined up, then I will go and aggressively pursue some of the young Olympians coming out of Rio and build them into the first generation of Ringstars.

I will also aggressively pursue promotional free agents, current or former champions and rising stars, and give them the benefit of my expertise, which always was to empower the fighters. With me, the fighters always got paid a lot more than anywhere else.

On the PBC:

I really applaud PBC and Al for what they have done. After two years. Nobody can do (what they need to get done) in two years, you have to give them five years. I hope I get the opportunity to promote these events.

Ringside Analysis:

This doesn’t come as a surprise to anyone in the boxing business.  Schaefer, perhaps infamously, enjoyed doing business with Mayweather Promotions and now the mention of working with the PBC is notable.  The PBC handles fighter management with what Top Rank calls “puppet promoters” operating the events in order to comply with the Muhammad Ali Act.  It is possible that Schaefer will handle the promotional side of all PBC events with Al Haymon continuing to handle the fighter management, essentially creating a business partnership between the two.

PBC ratings have been concerning and maybe the help of Richard Schaefer will help the PBC change course towards being a profitable company.

[jeffcgarrett]

UFC and Snapchat Announce Partnership

The UFC and Snapchat have joined forces to create and distribute content on the Snapchat platform.  The content will cover live events and give behind-the-scenes footage.

From the press release:

UFC® today announced a multi-year partnership with Snapchat through which the social media company will cover a selection of events via its ‘Live’ product. Fight fans at UFC events, that also have the Snapchat mobile app on their iOS or Android devices will have the opportunity to contribute their unique experiences through photo and video Snaps to one collective, curated Snapchat Live Story. These Live Stories will then be available for Snapchatters globally to view for 24 hours following the event.

"We're excited to partner with Snapchat and continue to offer compelling and fun content both in-arena and globally during our major events," UFC Chief Content Officer Marshall Zelaznik said. “We’re dedicated to supplying access to our content through the platforms that are relevant to our lives and producing global Live Stories is another way we’re consistently engaging with our fans."

UFC currently has more than 46 million followers across all social platforms around the world. On Snapchat, UFC captures press conferences, athlete and celebrity Q&A’s, open workouts, media day events, weigh-ins, behind-the-scenes moments during Fight Nights and first-person accounts by athletes. UFC also hosts a weekly show on Snapchat entitled “Cookin’ with ‘The Menace’ featuring UFC featherweight Dennis Bermudez. 

The first partnership efforts will take place during Fight Week and UFC 200 and will be in full effect by UFC 202 featuring the rematch against McGregor and Diaz.

Ringside Analysis:

Snapchat “stories” show great content created by both the events or brands themselves and the attendees of the events.  When users make a video or take a photo they can upload their content to Snapchat where it is curated by the company and placed into a single story.  

The company also uses filters that are geo-targeted for an event that show location and relevant designs.  Also, there are some filter effects that appear on Snapchat that coincide with an event.  For example, when Coachella was occurring and had a story there was a filter available that allowed people to put a flower halo around their heads.  Personally, I’ve seen that filter on Facebook many times since then as people’s profile photos.  

This could be a huge gain for the UFC.  The UFC sells really well with the 32 and under demographic, which happens to be the core of Snapchat users.  With UFC events being placed as stories on the app for everyone to see there is a tremendous amount of exposure to a “mainstream” audience that can garner new fans.  However, all content needs to be geared towards a mainstream and casual sports fan audience and not a core UFC fan.  There is a pretty stark difference.

I am looking forward to getting behind-the-scenes access that I otherwise would not get creating a strong value and incentive to be on Snapchat.  

[jeffcgarrett]

PBC on CBS Keith Thurman v. Shawn Porter Draws 2.12 Million Viewers

Keith Thurman won a close but unanimous decision, 115-113 by all three judges, over Shawn Porter who pushed the champion to the limit.  It was another PBC event on a network channel during prime time.  The fight drew an estimated 2.12 million viewers, which is an improvement upon the last PBC show on a network television network.

According to TV By The Numbers the program had a .5% share amongst the 18-49 demographic and a 2% share overall.

Ringside Analysis:

This event went up against a lot of other sports including an MLB game, the Olympic Trials, and came after a full day of soccer.  The improvement in rating is a very positive sign as many people were deeming the PBC a failure after last week’s show that drew poor ratings.

With the fight being much of what boxing fans love about the sport the next show might draw some more viewers.  The fight was electric, action-packed, and many portions of the night made it onto ESPN’s SportsCenter.  The next PBC on network TV event might be indicative of how much a great fight can have on follow-up programming.  

[jeffcgarrett]

UFC -- No Sale Yet ... Not Even Close

Reports are swirling that the Fertitta brothers are no longer the proud owners of the UFC ... but TMZ Sports has learned it's just not true. According to…

UFC Sale “Not Even” Close According To TMZ

Earlier this week Jeremy Botter reported that the UFC had closed a deal to be sold for $4.2 million to an entity consisting of WME-IMG, The Dalian Wanda Group, The Kraft Group, and Tencent Holdings.  The UFC was quick to respond saying that no sale had been made in an internal memo to employees.

The original report says that the deal was finalized on a day in Hollywood but all of the stakeholders were spread out across the globe during that day, meaning it was impossible for any meeting to even take place.

TMZ also says that a deal won’t be made this week and that there’s a chance it may never happen.  While negotiations are taking place “a deal isn’t even close.”

Ringside Analysis:

Jeremy Botter, who previously had a run-in with less than reliable journalistic efforts dealing with an alleged sexual assault case involving BJ Penn, has been contacted by the UFC with a letter saying that his reporting has damaged the organization.  Botter has been wrong before whether it’s reporting that fights are going to happen that never come to fruition and also has alleged that certain fighters are on performance enhancing drugs.

This sounds like a good use of PR by the UFC.  In all likelihood an anonymous source sent to TMZ might have been someone at the UFC whose goal was to disseminate information to cool down all the “sale finalized” stories.  

The possible sale of the UFC has been one of the hottest stories in the MMA and sports business world for the last week.  We’ll see if anything actually comes from it.

[jeffcgarrett]

UFC exec says reports of UFC sale are 'false,' internal email to staff offers same message

The world’s largest MMA promotion may eventually change hands at some point, but UFC officials insist that no such transaction has taken place at this time.

UFC Denies That Sale Has Been Made

It has been reported that the UFC has been sold to a combination of investors made up of The Dalian Wanda Group, WME-IMG, The Kraft Group, and Tencent Holdings.

If the rumors are true the sale would be for 100% of the company with the Fertitta brothers exiting participation in the company but Dana White staying on as President.  Dave Sholler, VP of Public Relations at the UFC, said the UFC sent an internal memo to employees that a sale had not been made.

From the article the internal memo reads:

“A report today by FloCombat.com indicating that the company has been sold is false,” the email read. “This follows other false speculation in the press recently.

“Such misrepresentation of facts in the media negatively impacts our business, staff members and athletes. We have instructed our attorneys to investigate and take all appropriate legal actions against the parties publishing and contributing to these false stories.

“With International Fight Week and the historic UFC 200 rapidly approaching, we look forward to once again delivering a series of events that our fans won’t soon forget. We appreciate your hard work, diligence and commitment, and thank you for your focus as we continue to take the sport to new heights.”

Ringside Analysis:

Reading this it’s more important to look at what isn’t said.  It isn’t said that the UFC isn’t up for sale nor does it say that negotiations aren’t going on.  The report says that it has not been sold, leaving the door open to sell in the future.  

Many of these memos are released to ease the concerns of current employees over any possibility of job security and Dana White has doubled down saying that no employee should be worried.

In terms of legal matters a reporter could be exposed to defamation, specifically libel, given that the possible damages resulted from a publishing.  However, it is unlikely that anything will come of this.

[jeffcgarrett]

The World's Highest Paid Athletes 2016

The world’s 100 highest-paid athletes banked a cumulative $3.15 billion over the last 12 months. Cristiano Ronaldo lands on top with earnings of $88 million.

Forbes Lists Floyd Mayweather, Manny Pacquiao, Conor McGregor, and Canelo Alvarez Among Highest Paid Athletes of 2016

Floyd Mayweather has been the highest paid athlete three of the last five years and comes in this year at #16.

Manny Pacquiao, who made a ton of money for fighting Floyd Mayweather and an international star in his own right, comes in at #63.

McGregor is the only UFC fighter on the list coming in at #85, although Ronda Rousey makes the list of highest-paid female athletes of 2016.

Saul “Canelo” Alvarez is ranked at #92 coming off a huge knockout win over Amir Khan.  The biggest fight that could be made in boxing right now is Canelo against GGG.

Ringside Analysis:

Conor McGregor’s mention on the list is the most notable to me.  Floyd Mayweather is obviously the biggest moneymaker in combat sports and Manny Pacquiao is one of the most famous athletes in Asia so it makes sense that they are the first two fighters named.

With McGregor and Rousey being so high we can tell that the UFC has enough money to be throwing around some serious dollars to the company’s top financial performers.  The purse listings for bottom-level fighters might make the UFC the sport with the highest pay disparity in sports.  

The listing in Forbes for McGregor doesn’t seem to include an extra contract he has with the UFC outside of his purse and win bonuses for actually fighting.  McGregor, if all of his earnings were disclosed, would most likely be significantly higher on the list.

[jeffcgarrett]

UFC sale reportedly imminent with two bids in $4.1 billion range (updated)

The UFC is close to being sold, according to an ESPN report.

UFC Soon To Be Sold For $4.1 Billion To Two Competing Bidders

(UPDATE):  Early reports say that an agreement to sell has been reached.  The Fertitta brothers will no longer be part of the company while Dana White will stay on as President.

Last month a rumor leaked into the world that the UFC was up for sale.  Dana White and the UFC denied that any sale was occurring.  However, ESPN’s Darren Rovell, who broke the original story about the UFC being up for sale, has reported that a deal to sell the UFC is nearing completion.  

The two bidders are reported to be WME-IMG partnering with the Dalian Wanda Group, and China Media Capital.  Rumors indicate that the bids are in-between $3.9 billion and $4.2 billion.  The highest bidder would purchase the entire company meaning that the Fertitta Brothers, Dana White, and Flash Entertainment would sell off all their voting interests and ownership rights.  Investors are also rumored to want Dana White to stay as President of the organization.

WME-IMG is led by Ari Emanuel, of Entourage fame, and has partnered with the Dalian Wanda Group, which is led by China’s Wang Jianlin who is valued at $35 billion.  WME-IMG is attempting to fully self-finance the acquisition and has received investments from the Kraft Group and China’s Tencent Holdings, one of the largest internet companies in the world.  

China Media Capital is a state-run company that has been buying many sports products such as the TV rights to China’s best soccer league.

In 2015 Lorenzo Fertitta said that the UFC made record revenue pulling in $608,629,000, and sources say that the UFC made a profit of $157,806,000.  

Ringside Analysis:

When the first rumor came out a month ago I suspected the valuation and bid potential for ownership of the UFC would be a partial sale.  The two bidders are based in China and the UFC has struggled for nearly a decade to break into the continent.  

Now that it appears that the sale will be for the whole company, reportedly with Dana White staying on, the Fertitta brothers are executing their exit strategy.  Any entrepreneurial venture has an exit strategy in mind and the Fertitta brothers plan to get out now.  They’ve done an amazing job so far and maybe they think they’ve taken the league as far as they can and that someone else can take it to the next level, or maybe that the league is so volatile that this is selling high.

The UFC has recently hit big with Ronda Rousey and Conor McGregor.  But the huge get with McGregor and Rousey is on the same coin as PPV ruts and down swings.  Relative to other sports leagues the revenue streams are much more inconsistent for the UFC.  The vast majority of the UFC’s revenue comes from PPV buys, which is dependent on certain fighters, and the calendar can be completely unstable due to fighter injuries and sometimes people retiring and saying thanks for the cheese.  The UFC is also undergoing several lawsuits and is now fighting a Muhammad Ali Act expansion into MMA, which could have a huge impact on how the UFC does business.

Either way, the bottomline to the current owners made up of the Fertitta brothers, Dana White, and Flash Entertainment, is that they are about to be paid a lot of money.  Quite the return on investment for White and the Fertittas who bought the UFC for $2 million in 2001.

[jeffcgarrett]

FanDuel, DraftKings in Merger Talks Amid Legal Fights

DraftKings Inc. and FanDuel Inc., the two biggest daily fantasy sports companies, are in talks about a merger, according to people familiar with the situation.

Two Largest Daily Fantasy Companies, FandDuel And Draft Kings, Reportedly Merging

Fan Duel and Draft Kings have been strongly competing against each other since daily fantasy sports became a business.  The industry has fallen on tough times and now the two private companies are looking to join forces.

From the Bloomberg article:

Investors in DraftKings and FanDuel, which are privately held, have been pushing for a tie-up for some time, according to the people, who asked not to be identified as the discussions are private. The companies offer nearly identical products and spend a lot of money competing with each other; they also face the same legal challenges that threaten their business across the U.S.

New York and eight other states have banned daily fantasy sports on the premise that it is sports gambling, an activity that is illegal outside the state of Nevada.  Lobbying efforts have begun with some states creating daily fantasy sports exceptions.

Ringside Analysis:

With the mounting legal fees and problems the whole industry is having to deal with it is very counter-productive for both companies to compete against each other while trying to keep their business models alive.

Madison Square Garden Co and the Kraft Group are investors in DraftKings and KKR & Co and Time Warner Inc. are investors in FanDuel.  

The short term benefits will have long-term consequences.  When the two companies merge there will only be one business in daily fantasy sports.  This means that the company will be subject to anti-trust scrutiny.  However, there is not a guarantee the two companies can merge.  If daily fantasy is a cingular category instead of a subset of fantasy sports then a merger could be unlawful and thus not take place.

[jeffcgarrett]

Report: NHL Choose Las Vegas for Expansion

The National Hockey League has decided to expand to Las Vegas, opting to place a new franchise in the heart of the Strip rather than Quebec City, according to a report by the Associated Press.

Biggest US Leagues Look To Las Vegas For Future Franchises

The NHL has given Las Vegas an expansion NHL franchise that will begin play in the 2017-2018 season.  Las Vegas was picked over Quebec City as a possible landing location for the newest team.  For years the major sports leagues have floated the idea of having a team in Vegas while balancing the public relations issue of having a professional sports team in the middle of the sports betting center of America.  

Bill Foley, the businessman pushing the bid and venture, is partners with the Maloof family, who owned the Sacramento Kings, in Black Knight Sports and Entertaintment.  The group must pay the league an expansion fee of $500 million if the deal is ratified by two thirds of the NFL owners.

T-Mobile Arena, run by MGM and AEG, is newly finished and will be able to host the inaugural season of the NHL franchise.

Recently, the Oakland Raiders said they will move to Las Vegas if the city is able to fund a $1.4 billion stadium.  The Raiders have been spurned in the migration to Los Angeles, with the Rams and Chargers winning the spots.

On a “Behind The Bets” podcast with ESPN’s Chad Millman, then Las Vegas mayor Oscar Goodman said that the city had a deal in place with the NBA that when the city of Las Vegas got an arena the city would receive a NBA franchise.

Ringside Analysis:

Las Vegas has a growing population now over 600,000 people and is the largest city in the country without a major pro sports team.  But the change in perception about the city is not based in population.

The concern with legalized sports betting seems to have eased over the years.  Daily Fantasy appears to be working as a gateway to sports betting and is making people more comfortable with the concept of betting money based on sporting events.  

NBA commissioner Adam Silver has said that sports betting would be good for the league because it makes games more exciting and increases avidity.  The NFL team seems to be cozying up to the idea of more open talk on sports betting and putting a team in Las Vegas.  For example, the NFL has strongly said that Las Vegas won’t have a NFL team but commissioner Roger Goodell didn’t outright say no to the Raiders’ proposal.

The strongest way to drive avidity to any sports event or team is economic incentive.  Once the US pro sports leagues embrace sports betting as a form of entertainment, and not a source of corruption, they will find a whole new world of possible revenue streams, growing fanbases, and increasing fan avidity.

[jeffcgarrett]

Adidas sales jump 31 percent, announces plan to sell TaylorMade - Portland Business Journal

Adidas Shows That The Underdog Isn’t Squashed By Dominant Force In Market

“Families are always rising and falling in America.” -Hawthorne

Adidas, the second largest sports apparel manufacturer in the world has experienced a huge boost in sales and stock valuation.  

Nike’s stock is -11.43 YTD and Adidas’ Stock is +31.54 YTD.  This means that, joined with the 18.8% long-term earnings-per-share growth for Adidas, the Nike stock is trending down while the Adidas stock is trending upwards.  Having said that, Nike has been growing extremely fast over the last few years and the drop in stock price could be due to not meeting financial goals set by investors.

Adidas has also been able to sell golf equipment manufacturer Taylor-Made.  Mark King, head of Adidas North America, said that Adidas will continue to make golf apparel and footwear.

Ringside Analysis:

The change in stock value for Adidas is a sign that all the recent marketing efforts and strategy moves are paying off.  Being in a distant second for sports apparel revenue behind Nike, Adidas had the ability to make some adventurous moves given that the company didn’t have that much to lose.  Also, Adidas has been really committing to proving their product in the US market like they never have before.

Signing Pharrell Williams and Kanye West as well as putting high fashion into the Adidas Originals line has put the three stripes far ahead of Nike in the lifestyle category.  The Originals’ dominance has been paying off huge in Asia.  Originals is still the greatest moneymaker for Adidas and selling off Taylor-Made will only help Adidas get further into the black.  

At some points the dominant force in the market, such as Nike in this case or the UFC, is viewed as so dominant that there doesn’t seem to be anyway for a smaller competitor to compete.  This case, so far, has illustrated that a company with room to make bold moves and risky choices can slowly get more market share.  There was a time where Nike was a distant second behind Adidas and there was a time where the UFC was legal in only one state.

[jeffcgarrett]

Nate Diaz, The Unsurprised 

Coming off of a win over PPV cash cow Conor McGregor, Nate Diaz is making a big push to get the pay, promotion, and respect he feels he deserves.  During negotiations it appeared that Nate Diaz is a dangerous person to deal with.  With the little details we get from twitter conversations and rumors on the web it seems like Nate Diaz was really in it to win it on the discussions.  He’s a fighter who had his first professional fight at 19, won The Ultimate Fighter Season 5 at age 22, and fought most anybody at any time.  He loves fighting and understands the business side, as much as he dislikes it.  It is because of his understanding of the business that he had been making things difficult when negotiating for his matchup against Conor McGregor at UFC 202.  

Nate Diaz went years fighting for only tens of thousands of dollars while having to pay a few fines.  After taxes and paying members of his team he wasn’t netting a significant amount of money for how much fighting takes out of a person’s health and life.  With the win over McGregor, for which he was paid $500,000, he now is pushing all his chips in.

It reminds me of the dialogue in Oceans 11 when Danny Ocean is explaining to Rusty Ryan why he wants to knock over three casinos in Las Vegas on one night:

‘Cause yesterday I walked out of the joint after losing four years of my life and you're cold-decking "Teen Beat" cover boys. [pause] 'Cause the house always wins. Play long enough, you never change the stakes. The house takes you. Unless, when that perfect hand comes along, you bet big, then you take the house.

Nate Diaz felt that he was in the position to have the perfect hand.  A McGregor-Diaz rematch would be one of the most profitable fights in the history of the UFC.  Diaz knew this, and the UFC knew this.  To really understand the story behind the negotiating it’s important to know the history between Nate Diaz and the UFC.

Nate’s older brother, Nick, has historically been the bigger “needle mover” as Dana White likes to say.  Nick Diaz was paid handsomely relative to other fighters in the UFC but still felt fighters deserved better pay, so it’s not surprising that now Nate Diaz is in the spotlight.  Nate Diaz made significantly less and even was a main event on UFC on FOX.

In all the interviews the Diaz brothers did there was a constant tension that the brothers loved fighting but hated the business of it.  The brothers just wanted to fight and were annoyed with having to negotiate with the compensation they received.  They didn’t understand why it had to be such a difficult process when the answer seemed extremely clear to them.  With Nate Diaz finally earning a payday, becoming a huge name by submitting the biggest “needle mover” in the sport, and the possibility that the miles of fighting were catching up to him, it makes sense that he may be on the edge of retiring.  

Nate Diaz’s willingness to not participate in the UFC anymore was apparent during the press conference for UFC 200.  When Conor McGregor said he was retiring Diaz got on twitter and said he would also being retired.  When Diaz was asked if he would fight someone else at UFC 200 Diaz responded by saying no because he would rather go on a vacation.

The dangerous side to the negotiation is that there was probably a realistic chance that Diaz would just walk away from the table if he felt he wasn’t being dealt with fairly.  The winning side of a negotiation is always the one who has more leverage.  Who needs who most?  What was unique about this situation is that leverage wasn’t present.  Sure, the deal with Diaz was most likely going to be made but the mere threat of Diaz walking away from the table.  

In the Cold War the US and the Soviet Union had missiles pointed at each other that could obliterate both of them.  There was an incentive that always carried both parties through the negotiation: that neither of them wanted mutually assured destruction.  The unifying factor was that neither the US or the Soviet Union wanted to walk away from the table without a deal, which could prove disastorous.  But, there was a unifying factor.  In this case Diaz squared off against the UFC and there was a feeling that the unifying factor of making a lot of money wasn’t as important to Diaz as it was to the UFC.  Diaz wanted the money, sure, but he wanted the promotion, and the respect.  It appeared that Diaz was willing to walk away from the table.

Sports business has a long history of making all things work when enough money comes into the fold.  When the NFLPA and the NFL were in heated negotiations for the new CBA there was always enough money in play that neither party would walk away from the table.  When the losing side of the negotiation is still making billions of dollars and gaining advantages in certain parts of the CBA, the deals tend to find a way of making themselves.

This negotiation process is the story of a fighter who loves fighting but also knows the business, and knows his value to the business.  In an interview with Ariel Helwani Diaz said:

“Treat yourself like a business and quit f*cking (saying) ‘I’ll fight for free.  That don’t help nobody. That’s bad karma for you for even f*cking (saying that). Stupid ass Cowboy Cerrone says that sh*t. That’s bad karma for everybody. You’ll fight for free, now everybody else has got to? Why wouldn’t they pay us? Because they got dumbsh*ts like you fighting for free. Start acting like a businessman and start treating yourself like a business and get your ass paid for being in an Octagon. The whole world watches you fight.”

Nate Diaz has treated himself as a fighter first and a reluctant businessman.  For years he felt, whether justified or not, that he was getting the bum end of the deal.  Maybe he felt that the negotiation over the rematch was the perfect hand to go all in on.  We will probably never know exactly how the negotiations went but Diaz probably knew that when you get the perfect hand, you bet big, and you take the house.  

The deal was made.  Conor McGregor is fighting Nate Diaz at UFC 202.  There was enough money on the table for the fight to happen almost no matter what.  Because of that, I’m not surprised.

[jeffcgarrett]

Professional boxers can compete at the Olympics in Rio de Janeiro, if they qualify.

AIBA Votes To Allow Professional Boxers Compete At Olympics

The AIBA, the International Boxing Association, has voted “overwhelmingly” to allow professional boxers to compete in the Olympics as soon as the 2016 Rio Olympics.

This decision was made with mostly the 2020 Tokyo Olympics in mind.  Given that the Rio Olympics are 10 weeks away there isn’t enough time for a full roster of professional fighters to join their national teams.  By 2020 professional boxers will be better prepared to compete in the amateur-style matches.  

There are some concerns that professional fighters could create dangerous mismatches against amateurs.  Mike Tyson, one of the best amateur fighters of all time, believes that amateurs would be competitive and could beat many professionals given the match style and schedules.  The WADA testing would also deter some professional fighters from participating.

Ringside Analysis:

With a lack of gold medal winning American boxers in the Olympics the US fanbase hasn’t grown attached to any fighters when their career begins, nor are they exposed to any of the fantastic international fighters that compete.  The Olympics used to be when an American fighter made his/her grand entrance into the casual sports fan’s mind.  

Professional fighters participating in the Olympics could be very successful or underwhelming.  I don’t think that many American sports watchers would enjoy the amateur-style boxing, especially when casual sports fans ask for more knockouts.  

[jeffcgarrett]

Conor McGregor-Nate Diaz 2 Scheduled For UFC 202

The rematch between Nate Diaz and Conor McGregor is officially scheduled for UFC 202, which is scheduled to take place on August 20th at T-Mobile Arena in Las Vegas.  

Nate Diaz submitted Conor McGregor at UFC 196.  Conor McGregor is still the UFC featherweight champion heading into this fight.  However, this fight will take place at the 170-pound limit, which is the weight that the last fight took place. ate Diaz took the fight UFC 196 fight on 10-days notice and wouldn’t have been able to make the 155-pound lightweight limit so McGregor said they could fight at 170.

Ringside Analysis:

At one point the rematch looked to be in serious jeopardy.  While originally scheduled as the main event for UFC 200, a Conor McGregor faux-retirement derailed any negotiations of the fight.  Mix in some demands made by Nate Diaz and the situation become exponentially more complicated.  Ultimately, there is simply too much money involved for the rematch not to happen.

Diaz had some grievances with the UFC so the Diaz and the UFC must have reached an agreement on marketing and payment for the rematch.  McGregor was always going to come back to fighting in the UFC but needed to negotiate his responsibilities when it comes to marketing the fights.  

McGregor claims his inability to pace himself is what did him in against Diaz so we will see how much he learned from his first loss in the UFC.  It will also be interesting to see how well Diaz does when he gets a full training camp to prepare for the fight.

[jeffcgarrett]

Brock Lesnar Makes UFC Return, Will Fight At UFC 200

The already stacked card for UFC 200 just got got bigger with the addition of Brock Lesnar.  In March 2015 Lesnar said he was done with MMA and he returned to the WWE.  While he is still under contract with the WWE, he was given permission in a one-off event.

Brock Lesnar was the main event for UFC 100, which still stands as the most purchased UFC program with 1.6 million buys.  He is a former NCAA Division 1 wrestling champion from the University of Minnesota who will be turning 39 next month.

The former heavyweight champion will be facing an opponent July 9th that has yet to be named.  Lesnar will return to the WWE for an August event.

Ringside Analysis:

There is beautiful symmetry with Brock Lesnar returning.  It is fitting that the former champion who was the main event for UFC 100 would at least be a participant at UFC 200.  However, Lesnar had a lackluster finish to his UFC career and is not the star he once was with the WWE.  The biggest selling point is his name, which is still known amongst casual sports fans.