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The House is gearing up for a battle over spending taxpayers money on sports sponsorship.  The focus is on NASCAR but you cannot cut NASCAR without affecting all sports.  The UFC recently inked a deal with the US Marines and many Mixed Martial Artists (“MMA”) have been sponsored by Military divisions.  If the measure passes these expenditures would cease.

Republicans are divided over topics that usually unite them (spending cuts, military and NASCAR) and the Democrats are excited to have the distraction.  At the heart of the battle is the $80 million dollars spent on sports sponsorships and the return on that investment.   The proponents say $20 million a race is way too much.  While supporters of the sponsorship programs, like Army National Guard Director Lt. Gen. William Ingram Jr. say “the program is effective. “  Without the draft, the Military needs to find ways to reach their target demographic.

There is no question that the Military’s target demographic is watching NASCAR and UFC type events.  The in-content exposure is valuable and hard to miss.  When marquee brands like Nike are cutting TV and Print spending by 40% in favor of Team and Event sponsorships it seems like an odd move by the House to pressure the Military in exactly the opposite direction.

As the US Marines learned with their UFC deal, there are other valuable sports properties that allow the Military to reach its target demographic and not spend $20 million per event.  The model in play with the UFC makes a ton of sense for The Marines.  The Marines are getting in-content branding on the most sought after sports property around.  They get interaction with the athletes, digital placement on the UFC’s website and more.

Unlike NASCAR or other sports like Bull Riding, MMA also opens the door to real engagements with the target demographic. This engagement can go well beyond the recruiting phase too.  We all have seen the UFC and Marine marketing program.  The House should be looking at ways to get more for the expenditures.  Ideas like:

  • MMA Athletes showing up during Basic Training to help during Combatives Training.

  • Military discounts on Merchandise and Tickets.

  • Armed Forces MMA Team – While on Active Duty the ability to train and compete at the amateur level (like they do with other sports like Boxing and Wrestling).

  • Veterans that were on the Armed Forces Team get immediate entry into TUF and their Pro card is paid for, in return they continue to represent their Branch of service.  Guys like Brian Stann should be a sponsored athlete and a part of a program that helps transition the soldier athlete to a professional athlete.

  • Lifetime free entry in signature events like Grapplers Quest and NAGA for active Military and Veterans.

Ideas like those will only enhance the ROI.  From a MMA perspective the price the Military allegedly spends on one race would fund all of the above programs for several years.  Every service member will learn some form of hand to hand combat during their enlistment.  There is no reason not to offer MMA as a Team Sport on the bases.  The opportunity to enhance the return on investment has never been better.

The House needs to realize that it is less about how much they spend and more about how they spend it.  If NASCAR has become too expensive then find other sport properties that reach the same demographic.  If you can find sports like MMA that weave into the basic structure of current Military life then you can find others.  You don’t have to spend $20,000,000 per race to reach your target demographic.  You don’t have to kill off your marketing plans because one part of the plan has become too expensive.  Just replace it.  The sport of Mixed Martial Arts would welcome this budget and the branding would be dominant and active 24/7 like our Military.


Mixed Martial Arts Gold Mine?

We have been blessed to work with some amazing athletes and sponsors over the past few years. They both shared one thing in common, they gain exposure when they perform, and in that performance they have a 50% or greater chance to loose. Throughout this time in the sport of MMA, fighters complain that they do not earn enough and the sponsors claim to not be able to identify the return on investment (ROI) involved.

One of the big issues is that the athletes are usually too busy to market themselves correctly and do not have the right representation helping them find the time and tools to build their own fame outside of the events. The sponsors rarely activate the sponsorship and roll the dice on the event. Yet the athlete they are paying has little to no control over the event, if they show the sponsors logos or the very important walkout. Some brands have paid mid five-figures per fight to have their shirt worn during the walkout and post-fight coverage.

Many opportunities to engage the consumer and potential consumers are often missed or ignored and the activation is almost non-existent. The major promotions like the UFC regulate and restrict which sponsors are allowed and even charge the Brands a sponsorship participation fee. This fees can sometimes be in the mid to high five figures per year. They are not given anything that any other brand is given. You would think that this “tax” would increase the sponsors desire to get more for their investment. Instead it appears to have only reduced the amount the sponsors are willing to pay, made the sponsors focus more on if the event will be televised, and at the same time weeded out the small to medium apparel companies from the mix and removed their ability to support athletes. That is at least what they will have you believe. The fact is, many have just used this “tax” as a reason to leave the sport because they never developed an ROI.

We have brought in many non-endemic sponsors that are focused on the athletes and are willing to look at the events as “bonus” exposure while working with the athlete in a true endorsement fashion. One of the UFC’s major sponsors, Bud Light and it’s parent company, is arguably one of the largest Sports Marketing agencies in the world. They are also one of the most successful.

There is no missing the event involvement Bud Light has in place with the UFC. Their approach to their MMA Fight Team is less about big in-event placement on the athlete and instead more focused on outside the event endorsement. They use their athletes in their retail point of sale advertisements, use the athletes image and likeness in their bar and restaurant advertising, produce webisode series promoting the athletes and more. They make sure they ingrain their brand and athletes at every possible outlet and event. It may be argued that they provide equal or greater promotion of these athletes than the UFC does.

So what are some of the solutions? The first step is for the Brands to realize they are sponsoring and endorsing an athlete. They need to have a plan in place on how they are going to extract value from the sponsorship and utilize these athletes. Instead of looking at it as a billboard type logo placement it must instead be viewed as a relationship. They have to get beyond being a fan of the athlete because that will only lead to the most expensive Facebook photo in the world. Second, they need to activate around the athlete and his or her platform. Use the events these athlete’s participate in as spikes in exposure and capitalize on the ability the events have to engage the target consumer but do not make this the be all, end all effort. The athletes and their team need to make sure they have a platform to offer. The brands need to try to coordinate and cross promote whenever possible.

As you can see Wrangler does a great job with this. They offer a wide array of their shirts with various PRCA and PBR sponsor logos on the shirt along with their Wrangler logo. I know MMA has to get away from having seven competing fight brands on one tee shirt and shorts before they can offer this type of merchandise. As you will see in the slide show below it is not just Rodeo either, many sports employ this model. You are also not tied to using all of the brands as you see with the Wrangler shirt above.

Here is the Official NASCAR Team DuPont Jersey.

And here is a NASCAR fan wearing the same jersey.

Obviously there are no competing brands on this jersey but you see various brands showcased and the primary brand DuPont is prominent. The fans buy these jerseys for the same reason they buy NFL, NBA and MLB apparel because it is authentic looking.

I recently moved to the Central Coast of California and on any given day you see a slew of Cyclists riding through the hills, coast line, and throughout town. I started to notice the majority of them are wearing authentic team apparel. Either Radio Shack has started sponsoring every cyclist in the world or once again we are seeing fans and practitioners of the sport seeking authentic apparel. Here are some examples –

Here is the Team Radio Shack cycling uniform.

and

Here is the Team using the uniform

And once again here is a fan who has sought, purchased, and is proudly representing the brand in the exact same gear.

This is not really a sport specific phenomenon. The fact is NASCAR, NBA, Soccer, MLB, NFL, PBR, PRCA, Motocross, Indy Car and more derive a considerable amount of revenue from this type of merchandise. The brands exposure is extended beyond the athlete, the event, and the athlete’s platform and the marketing provided by the Brand. The exposure alone is a tangible return on the sponsors investment and having your brand worn by your target consumer or applied to your target consumers personal property becomes an extremely valuable proposition for the brands supporting these athletes and Teams.

The majority of the MMA industry is missing this market and opportunity. From the athletes to the brands no one seems to be making any replica merchandise. There is no doubt that there is a demand for these types of products. There is no doubt that in these tough economic times we need the sponsors to be more successful then ever before and at the same time find a way to extend the engagement beyond the events.

The managers and agents in the sport of MMA need to get out of the patch business and get into the brand building business. They need to build the brands of the athletes they represent and help guide the brands that support those athletes to successful and controllable engagements. If you are merely trading logos for dollars based on exposure you did not create you are on the path to failure for you and your clients.

The athletes need to look for ways to connect with the fans and extract value for the sacrifices made. Depending on events and televised exposure you can not and do not control is a recipe for disaster. You need to yourself or have other people helping you build your brand and increase your exposure even when you are not fighting.

Brock Lesnar’s sponsor Death Clutch has offered replica walk out tees in the past. They seem to be one of the few brands or athletes offering such items. In the past you used to be able to buy the Overeem Replica Fight shorts. The issue with fight shorts is that unless you can kick ass like The Reem you probably should not be wearing his shorts. It is kind of like showing up to your first BJJ class with 20 sponsors on your gi.

Here is the Death Clutch UFC 116 walk out tee:

We have had one client that fought 9 times and 3 of which were in the UFC and he had earned just under $100,000 for 3 years of work and 9 fights that he won, his MMA earnings were predicated on when or if he fought. The same client is now a millionaire based on competing 3 times over two years. He has months where he makes $50,000 and has consistently has earned a monthly income from his endeavors in and out of the Octagon. The difference has been focusing on building his brand and finding ways for his sponsors to earn their ROI. He has both endemic and non-endemic sponsors alike.

The authentic and replica tee shirts are a great opportunity to increase your brand, your sponsors branding, and your income as an athlete. You can go to any size event and you will see merchandise similar to what you see here and in our slide show. If the athletes do not create these then the brands should. Even the video games strive to ingrain authentic sponsors on the in-game characters on both the THQ and EA Sports MMA games.

This should not be ignored and it very well may be the lowest hanging fruit in the entire MMA market. If you trained would you wear replicas of your favorite fighters shorts or rash guard?

I am sure just about everyone in the US has seen that NASCAR fan who has their personal possessions or vehicles with logos from the brands that support their favorite athlete.

Here is a slide show that shows various sport jerseys and tee shirts and the fans that wear them. It is easy to see the potential market that is out there. A lot of these fans are cross over fans and are fans of many sports.


Social Experts or Snake Oil Salesmen?

We’ve received quite a few emails about our Facebook blogs, so we wanted to expand upon some of those thoughts. Please feel free to comment or send us an email about your thoughts.

The fact is Facebook is a 500 pound “Gorilla” and most people know of it or have an account. So essentially, it becomes the easiest target for companies and brands to focus on. The job of “social media manager” is one of the fastest growing new job postings. University of Southern California is even offering courses and degrees focused on this new phenomenon. Agencies all over are working overtime to create new divisions focusing on social media. Pretty much every brand has a social media “expert” to assist them in this new world of social media.

The “affiliate marketing” experts are now touting their social selling skills and as this new market emerges, the so called experts seem to be more like job seeking opportunists rather then social media experts.

This group of newly employed “experts” continue to spout off about engagement on third party social platforms like Facebook as if they are Mark Zuckerberg’s first cousins. They are the same ‘experts’ that lead brands to the social graveyard called Myspace.com. They claim that these engagements are meaningful and encourage these brands to spend their hard earned money to help promote a third party application. Billions of dollars are being spent to gain a “like” and resulting in tons of free exposure for the brands like Facebook. Where is the ROI? They are merely telling brands what the brands already know (that Facebook is popular) and that social media marketing is an emerging but necessary market.

As we have discussed in our previous blogs, people (the brands target consumer) use social networking and specifically sites like Facebook to connect with friends. There was a time when you could not even join without a connection within the network. Now that it has grown, the brands and their experts see Facebook as the holy grail of social media marketing.

Facebook is essentially web 2.0’s version of email You do not need to send emails through email clients. You can share, connect or find your friends, colleagues and family. It is an easy way to stay connected and communicate with the people you want to connect with. No email address changes or loosing the phone number. Just type in their name and Facebook will give you numerous ways to connect. Most consumers do not seek to have these kinds of relationships with brands. They are interested in brands providing them content, information, contests and so on, but a meaningful friendship is not what they are after. If you are a brand and not an athlete or celebrity, the actual engagement ration on Facebook for brands is close to zero percent.

People aren’t involved with most brands’ fan pages, even though on a daily basis a large percentage of them are involved in connecting with the brand. The problem is the “real” engagements and the feedback provided is normally one directional. This is not engagement, but more like a new form of email spam. When the engagement is real Facebook provides no real way to engage the users back. Ultimately, what little success you will find can backfire. The consumer will feel ignored.

People tend to forgive the celebrities for the lack of response. The celebrities tend to be forgiven based on the sheer number of fans they have commenting. It would be humanly impossible to engage with 50 Cent’s 12,000,000 Facebook fans. He offers his hard core fans his own unique social network that has over 540,000 active members (www.thisis50.com). To me, this group is far more valuable to 50 and his endorsed brands. He can directly communicate back and forth with his fans. The engagements are real. He can monetize thisis50.com and owns it rather then being a passive participant on Facebook.

There are too many people and groups on Facebook and making lasting and meaningful engagements is next to impossible. Facebook and sites like it offer the users of the site a tremendous platform to stay connected and communicate. It just does not mean that all of its users will “like” you or even be your target consumer. Social media is like having clovers in your lawn. They look cool and you hope to find a four leaf clover but they are not necessarily good for your lawn.

I always try to get our clients to visualize social media as a virtual social gathering. If you had a gathering with 12,000,000 people, it would be chaos. Even 500,000 could be chaotic so brands have to remember that they are going to be at the center of the conversation. So building your network needs to be balanced with feeding your network content and meaningful engagements.
Brands should, however, focus on Facebook advertising. The cost to advertise on Facebook is very affordable and very effective. Since Facebook revolves around socializing, those conversations create the ability to target conversations and interest. Facebook users tend to list their likes and dislikes and Facebook advertising can effectively help you find your target consumer. Targeting is the smartest ad expenditure brands can make. Niche advertising networks like MMAAdnet.com are one solution; contextual based targeting is another. Each are very effective and remove a lot of the mystery involved when advertising on or off line.

Brands SHOULD have a page or at least a group or two established on sites like Facebook. They should use these platforms to help find and potentially extract this consumer from being a passive friend to a truly engaged consumer. At the very least, Facebook and third party social media platforms offer “free advertising” for brands.

Build a realistic plan, assign realistic goals and go. If you are using it correctly, social media will tell you where to go and what to do. You have to listen to the consumer. If your expert has advised you to focus solely on Facebook and suggests hiring staff to manage the comments and tell you what you should be sharing, you might need a new expert. There is no magic to social media marketing. It is about engagements and providing feedback in a timely manner.

You can have your own thisis50.com style site with an iPhone app for under $5000. You and your team can manage this and all of your social platforms through your cellphones and desk top. I guarantee you it is not Weird Science or even Sixteen Candles. It is just communication with the very person you are willing to spend tons of money to understand what they like and want. Save your money and time and just ask them.

Jason Genet

IngrainedMedia.com


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