- Fight pitted boxing versus UFC and Mayweather’s mega-wealth and 49-0 win record against McGregor’s provocative personality and rags-to-riches story
- Companies that controlled rights to show the contest benefited from audience cross over and the wave of interest among casual sports fans
- Endorsements earned the two fighters at least $20m each, while sponsoring brands also gained
So after all the hype and speculation, undefeated boxing legend Floyd Mayweather did as expected and dispatched gritty Ultimate Fighting Championship (UFC) star Conor McGregor on Saturday night at the T-Mobile Arena in Las Vegas.
A 10th-round stoppage means both men emerge with their reputations intact and fans who paid up to $100 (€84) for a live pay-per-view (PPV) feed probably got their money’s worth.
No one knows for sure how much money the fight has generated but $600-$700m from tickets, TV sales and sponsorship seems to be a generally accepted figure.
Of this, Mayweather is expected to walk away with $200m while McGregor will take home around $100m – not bad for a young man who was pretty much broke until four years ago.
At first sight, it’s hard to see why a boxing match between a 40-year-old retired fighter and a mixed martial artist who has never boxed professionally should have become one of the most talked about sports events of the decade.
But this is sport in the entertainment age, where media companies and fans are looking for larger-than-life stories as well as supreme skill. Mayweather’s mega-wealth and 49-0 win record, McGregor’s provocative personality and rags-to-riches story, Boxing vs MMA, the Irish connection, iconic fashion, celebrities at the ring-side in Las Vegas – all of it added up to a unique event.
So as the dust settles, what can we learn from the bout? How will boxing and UFC fare in the long run, for example, and what is next for McGregor? Which brands and organisations managed to take advantage of the event – and what lessons does the fight offer others in the sport business ecosystem?
Sport is show business
Viewed first from a boxing perspective, veteran sports promoter Barry Hearn – speaking to Sport Business International prior to the fight – said the bout was “a total mismatch. McGregor has a lot of spirit but that doesn’t count for much when you’re in the ring with an exceptional talent like Floyd Mayweather.”
In a pure sporting sense, Hearn advises that boxing won’t have learned much from the fight.
However, he does think the fight can teach ‘the noble art’ something about marketing. He says: “They’ve both made a lot of money and good luck to them – because sport is show business. Boxing is quite a niche sport but Mayweather and the UFC came up with a formula that appealed to both the casual fan and the millennial audience.”
Hearn doesn’t anticipate many more opportunities for boxing/UFC crossovers, but he does believe boxing should continue to explore ways of reaching out to a wider fanbase: “We look after world heavyweight champion Anthony Joshua,” says Hearn. “He has a wide appeal with casual fans and that translates into good figures on PPV. As a company, we place a lot of emphasis on social media these days because it plays a key role in building up the personalities of the protagonists.”
The power of social media is also picked up on by KB Reidenbach, a partner at digital marketing firm Levelwing who also happens to be a certified USA Boxing coach.
He says: “The unique thing about the Mayweather vs McGregor event is that social media was one of the key drivers of the fight getting made. McGregor made an offhand remark about Mayweather in an Esquire piece and that created a link between the two athletes that grew into the August 26 mega-fight.
“Social media had a big influence on the decision to make the fight as both fans of McGregor and Mayweather, as well as fans of combat sports in general, began to create a social buzz about a match-up. I firmly believe the social media engine also helped Mayweather’s team qualify the financial opportunity this fight presented.”
Like Hearn, Reidenbach says “there is certainly the potential for the sport of boxing to benefit from younger fans participating in the social conversation. According to a recent study, the average age of a boxing fan is 49 years old and having so many younger McGregor followers engaged in this boxing event could certainly generate some younger fans for the sport.”
There is an early opportunity to see whether the fight has any impact on the appeal of boxing, adds Hearn, with Canelo Alvarez set to box Gennady Golovkin on September 16.
An HBO PPV event that will also take place at the T-Mobile Arena, Hearn says this middleweight unification bout is one of the most hotly-anticipated matches of the year, so it will be interesting to see if it can continue the crazy momentum of the Mayweather-McGregor contest.
Pre-event estimates suggest there will be 3.5 million PPV buys at $70 a time, with promoter Oscar De La Hoya relieved that the Mayweather McGregor bout didn’t prove to be the kind of dire spectacle that can put audiences off PPV boxing for years.
From a UFC perspective, the first obvious issue is what will happen to Conor McGregor after the bout. Will he, for example, shed fans as a result of his defeat?
Reidenbach doubts that: “McGregor has achieved such a high level of social engagement by being authentic and sharing behind-the-scenes content that has endeared him not just to his core fans but to the casual fan. I think his brand will be as strong as it ever has been and he’ll still have earned the respect of a large audience segment simply by attempting the impossible task of beating an all-time great at his own game and doing it with a level of enthusiasm the boxing world hasn’t seen in quite some time.”
This point is endorsed by UFC senior EVP and chief operating officer Lawrence Epstein who says “the event has been great for Conor. He’s a cool guy with an infectious personality and he has put in a lot of work during training. He can’t lose.”
When the fight was first mooted, UFC president Dana White was against it – but eventually came round to such an extent he was co-promoter on the fight.
Explaining that u-turn, Epstein says it was partly about giving fans the fight they wanted and partly “an opportunity to expose UFC to a wider audience.”
In the immediate aftermath of the fight, there were calls for more MMA/boxing cross-over bouts – maybe involving McGregor, or maybe not. But White has made it clear he’d rather focus pure UFC fights for the foreseeable future – with McGregor possibly returning to the sport on December 30 to fight Khabib Nurmagomedov. Speaking at the post-event press conference, White said “I don’t even want to talk about my other guys in a boxing match. This was built from the bottom up from the fans to the media and then up to us when we even started remotely considering something like this. It was just a real special and rare event. I’m not looking to do this again.”
That said, Epstein stresses that the UFC wants to bottle some of the magic from the Mayweather fight: “I’m certainly not referring to this as a once in a lifetime fight. It’s a very competitive world out there so you need to put on a great show if you’re going to get people to pay. I think one thing this event reminded us all is that sport is supposed to be fun, you’re supposed to yell and scream and have a good time.”
McGregor is by far the biggest attraction in UFC, generating around 1.5m PPV buys for most of his recent events. So one obvious question for the sport is how would it cope without him, for example if he decided to go off and launch a movie career (echoing WWE wrestling star Dwayne ‘The Rock’ Johnson). Epstein is confident that this isn’t going to happen but stresses that “the UFC is in the star-building business. Conor is the latest but not the last iteration of that business.”
Building fan passion
On the subject of social media, Epstein says building fan passion is nothing new for UFC. He explains: “Back in 2001 when we launched, no one would write about us, so we had to do everything we could to get the sport out there. We were early adopters of social media and it has become a core competence of the UFC. These days we work with our athletes to ensure they have something interesting to say and we curate a lot of content to push out to our audiences.
“We have also put a lot of effort into widening digital distribution. If you compare this fight to the recent Mayweather vs Manny Pacquaio fight you’ll see the live PPV feed was made available via a much broader range of platforms – including our own UFC.tv platform.”
It’s not just boxing and UFC that have been talking up the fight’s value as a way of reaching new audiences. Companies that controlled rights to show the contest have also cited the benefits of both the audience cross over and the wave of interest among casual sports fans.
Pre-event, for example, Showtime Sports EVP Stephen Espinoza noted: “We’re not only drawing from the universes of boxing and MMA fans, we tapped into an audience that doesn’t follow either sport.”
Tim McManus, director of marketing at Joe Hand Promotions, agrees: “We have the exclusive US rights to UFC PPV in commercial establishments and have done numerous boxing bouts in the past. But we’ve never seen anything like this. We started selling at the end of July and have been talking to a range of venues that wouldn’t usually come on to our radar.”
It’s a similar message from Perform-owned sports streaming service DAZN, which showed the event in Germany, Austria and Japan as part of its regular subscription offerings. “We’re still quite a new service,” says DAZN spokesperson Mel Baroni, “so for us the real opportunity with the Mayweather McGregor fight was to encourage people to trial our service. If we can use events like this to get people to subscribe to the service then they get to sample our range of other live sports rights.”
While the TV revenues are by far the most significant part of the fight’s take, it’s worth noting that a number of brands have managed to generate decent exposure off the back of the fight.
Combat sports are not the right environment for every brand, says Garry Dods, founder of sponsorship consultancy Wearefearless, but for many it is an irresistible opportunity – including Rolls Royce, which has partnered with McGregor.
He says: “When you bring together two of the biggest names and talents in their sport making it one of the biggest fights in history, you get eyeballs, you get attention, you get the world watching. And, in this day and age, with this comes sponsors.”
Dods says backing a fight like this is “not for the faint-hearted. But brands are willing to pay for this association because the exposure is unreal. These fighters have built up strong luxurious lifestyles that offer so much value to the likes of online gambling companies, energy drinks and lifestyle & fashion brands. They recognise the opportunity, the kudos and sky-high status of being involved and make sure it works.”
A case in point is watch brand Hublot, which paid an estimated $3.5m to appear on Mayweather’s shorts and wrist. It also got the added advantage of being referred to directly during the press tour trash talk – watched by millions online.
A cross between a catwalk and a cockfight, the four city press tour offered massive exposure opportunities for brands like Gucci, Monster Energy and Dr Dre’s Beats, which created a special Irish version for McGregor. When images of McGregor at the weigh-in went viral, Calvin Klein was another prominent beneficiary. Reports suggest that Mayweather’s personal endorsements ranged in value from around $1m for his robe, shoes and victory hat to around $5m for sponsorships appearing within the ring.
All told, endorsements earned the two fighters at least $20m each. But there were other brands that also benefited. T-Mobile, with naming rights to the fight venue, featured prominently in all of the coverage up to and around the event. It reinforced that engagement with competitions that gave its users the opportunity to travel to Vegas for the fight.
As yet, it’s too early to tell if any brands managed to piggyback the event on social media – as Oreos did around the Super Bowl XLVII.
But Levelwing’s Reidenbach says “responding to the fight in real-time on social would have been a way to engage, especially knowing that so many viewers would likely be following the social conversation as it happens.”
So the big question for other professional sports is – can they do something similarly amazing? White’s view on this is worth bearing in mind.
He says: “It takes two special people and the right place and the right time to do the freakish kinds of numbers and the watercooler talk and all the things that this fight had. You have to have the right people in the right place in the right time. This s**t doesn’t happen all the time.”
It probably isn’t possible to manufacture events of this scale often – but they do come along; witness Nike’s Breaking2 marathon attempt and Red Bull’s working with Felix Baumgartner on his jump from the edge of space.
Reidenbach offers two key conclusions. “Firstly, I think the Mayweather/McGregor fight is going to be a great barometer for the idea that social engagement can drive PPV revenue,” he says.
“Secondly, I think a big lesson to take from this is the open-mindedness that has been exhibited by all parties involved. From the fighters to the promoters and even the networks, they all collectively saw an opportunity to engage a fan base of two sports and they have run with it and successfully delivered the biggest fight of all time to sports fans.”
EXTRA: UFC – The Bigger Picture
UFC will be pleased with the massive exposure that the Mayweather-McGregor contest achieved. But it will now be watching carefully to see if the fight generates any long-term strategic value for the MMA franchise. After all, it’s only a year since WME-IMG acquired UFC for $5bn, so there will be internal pressure for it to hit tough financial targets.
There are four main areas to watch. The first is UFC PPV buy-rates. The Mayweather fight attracted around 4.9m buys, but a typical UFC fight involving Conor McGregor comes in at around 1.5 million. UFC will be looking to a) grow McGregor’s numbers and b) use his involvement in UFC to build other PPV stars. This could be done by creating exciting new rivalries or presenting McGregor more in a mentoring role. Absolutely critical at this stage is that UFC doesn’t lose McGregor – even if this means giving him an improved financial deal (possibly including a stake in the UFC itself). Fortunately for the UFC management, losing to Mayweather means McGregor’s fate will be linked to MMA for at least another couple of years. After all, he still earns $4m a bout from UFC – usually two or three times a year. However, the fact that he has set up his own promotions operation suggests he is looking to capitalise on his new-found fame.
The second is how well the UFC does in the next round of TV rights negotiations (content that sits alongside the franchise’s live PPV events). Currently UFC generates $100m-$150m under a seven-year deal with Fox that ends in 2018, but is keen to treble that figure. UFC is confident it can get an increase because there are not many premium live rights coming on to the US market in the next few years. But it may need to offer more top fights to secure such a deal, rather than keeping all the best bouts for PPV. Likely contenders for the rights are media firms that can benefit both from UFC’s high volumes of content and robust appeal in PPV – such as Fox and Turner Sports.
International growth is another priority for MMA. The Mayweather-McGregor fight generated strong PPV revenues in North America and the UK and modest PPV buys in Australasia. It was also aired in markets like Germany, Japan and Brazil (the latter via Globo-owned PPV service Combate). There is an argument that WME-IMG will use its deep roots in China to try and build the UFC franchise’s popularity in that market.
There’s also the question of sponsorship. Mayweather and McGregor did well out of endorsements, but can UFC capitalise with longer term partnerships? UFC’s Lawrence Epstein said: “The build up to the fight was so compressed that we didn’t have a lot of time to put together any new partnerships. But we did tons of pitches to companies we haven’t spoken to before and hope that will develop into something further.” Not that the situation is desperate. UFC already counts Reebok, Harley Davidson and Budweiser among its sponsors.
- TV Exposure
A co-promotion between Mayweather Promotions and the UFC, the Mayweather vs McGregor fight is expected to have generated around 4.9 million PPV buys – which means revenues just shy of $500m. However, in many parts of the world the fight was available via more standard forms of TV distribution. In total, the UFC reckons the fight will have been available to around 1 billion people in 200 countries. To put the scale of the fight in perspective, this year’s heavyweight boxing showdown between Anthony Joshua and Wladimir Klitshko generated around 2.2 million PPV buys in the UK and US, which is regarded as a very healthy return for a boxing match.
Betting on the Mayweather McGregor fight saw most punters back the Irishman – not because they expected him to win, but because the odds on Mayweather were so bad. Within Nevada, it is estimated that $50m in bets was placed on the fight. Not surprisingly, betting firms were keen to get in on the action in the form of sponsorship deals. Betting firm Betsafe signed a deal with McGregor while Paddy Power – masters of the tactical sponsorship – appeared on Mayweather’s shorts saying “Always bet on black”.
The fight is reckoned to have generated a record-breaking $80m – despite the fact that only 14,600 of T-Mobile Arena’s 20,000 seats were filled. The reason for the empty seats was that ticket prices were initially set in the $4,000-$10,000 range. As the fight approached, prices dropped to around $1,300 but were still too high for the army of Irish fans wandering up and down the Vegas strip. Post-event analysis suggests the price was too high for an exhibition fight – although Mayweather and McGregor probably aren’t complaining.