The UFC announced on Tuesday the finalization of a landmark six-year partnership with Reebok, a deal which could dramatically shift the role of sponsorships in mixed martial arts. Beginning the week of July 6, 2015, the UFC will institute a sweeping new uniform program which will effectively replace all in-cage fighter sponsorships with kits produced exclusively by Reebok.
"We look at this as Reebok and the UFC are essentially changing the sports landscape once again," said UFC CEO and co-owner Lorenzo Fertitta. "This clearly has never been done in combat sports. Reebok will be the exclusive worldwide outfitter of the UFC, and as part of this deal and this partnership, this will be the biggest non-broadcast partnership that our company has ever signed, so it is significant.
"We're continuing to do things and implement things to elevate the level of the sport, and really take it in a place where other major sports leagues are. So the way that this outfitting policy will work is that it will allow for each of the fighters' individuality, but also will provide a unique, iconic and consistent look for all the athletes, obviously very different from where the sport has been in the past, where it is essentially, for lack of a better word, a bit of a mish-mash with various different sponsors, different looks, brands, and styles."
Fertitta elected not to disclose the value of the deal, repeating only that it was the "largest deal we've ever signed" outside of broadcast deals.
Participation in the new uniform policy will be mandatory for every fighter under UFC contract.
In calling the partnership a "seminal moment" for the UFC and the sport of mixed martial arts, Fertitta explained that "the vast majority, if not all, of the revenues" from the deal will be redistributed to the UFC's roster. Fighters will earn a tiered sponsorship income dependent on their ranking the day of weigh-ins prior to their fight, regardless of card placement. Champions will bank the most money, followed by (in descending order): fighters ranked No. 1 to No. 5 in their division, fighters ranked No. 6 to No. 10, fighters ranked No. 11 to No. 15, and unranked fighters.
While not delving deep into detail, Fertitta explained that each fighter will be distinguished by their own personalized kit, and that in addition to a flat sponsorship income, athletes are also expected to receive 20-percent royalty payments dependent on sales for their individualized kits into perpetuity, meaning retired fighters will also draw from the program.
"Imagine Cain Velasquez," explained Fertitta. "He obviously will have a certain look, feel, and appeal to his merchandise and what he wears into the Octagon. He will be compensated based upon how much of that actually sells, over and above what he will be paid as defending champion for a fight.
"At the end of the day, the more successful you are and the more demand there is for you, as an individual brand, [the more] you're going to sell. That's the way the system works, it's a capitalistic system here at the UFC."
Though he didn't offer a timetable, Fertitta indicated that plans are also in the works to create kits for retired "legends" of the sport. Cornermen on fight night will also be beholden to the uniform policy.
Fighters will still be allowed to carry additional non-UFC sponsors under the program, however those sponsors may not be on display for any UFC-designated fight week events, which includes open workouts, media days, press conferences, weigh-ins, and fight nights -- a wrinkle that effectively brings an end to the tradition of fight night banners.
"You guys have seen it when we've had press conferences before and fighters are upset about sponsors, guys are walking in wearing UFC clothes because they don't want to haggle with the sponsors anymore," said UFC President Dana White. "Whether you're at the top of the heap, or you're at the bottom, (now) you know every time you step in there, you're getting paid. You have a sponsorship, you're getting paid every time you get in. And it's more incentive to get bigger and get better."
"Ultimately the consumers and the fans are going to decide," Fertitta added. "They're going to be voting with their wallets, so they're the ones who are going to be deciding essentially who makes sense to be in the retail space."
Fertitta indicated that several uniform colors and styles will be available to both fighters and consumers, including board shorts, vale tudo shorts, and "skorts."
The UFC rankings, other than a few potential and minor exclusivity tweaks, are expected to remain the same media-generated entity under the new program, obviously with increased importance due to the tiered sponsorship payout structure.
"[This announcement] is going to help the fighters because it's going to allow them to focus more on their training, and not have to run around and try to get some of these sponsors that you guys are all familiar with, that aren't blue-chip Fortune 500 companies, I might add," Fertitta said. "If there is a sponsor on our uniform or on our kit, it's going to be a major global brand like you see in some of these other sports, like the European soccer leagues. So just that alone is going to completely change the perception of the sport, the perception of the athlete, the level that we're at.
"This is a true game changer. We've had a lot of game changers as we've built this company, starting from ‘The Ultimate Fighter,' which was a game-changer when we did our deal with Spike, to when we got Budweiser -- the leading sport's sponsor -- onboard with out brand, to landing our FOX deal and partnering up with Electronic Arts. Reebok is right there at the highest level in that group of some of the seminal moments, and I think we'll look back in 10 years, like we look back at when ‘The Ultimate Fighter' launched, we'll look back at this announcement as being that important."
This post was edited by KrWWW on Dec 2 2014 10:39am