Please no touching of the hair or face 🥊

Please no touching of the hair or face 🥊

UFC 300 this past Saturday hosted an internet-dominating knockout of Justin Gaethje via the fists of Max Holloway. 🤕 The brutal yet captivating punch-to-the-face spurred a SportsBall deep dive into the business of the UFC.

The four major US sports leagues all have a similar structure.

📅 4-6 month regular season
📅 Playoffs for 1-2 months
🏖️ Rest of the year as the offseason

Not in the UFC. No off-season in the fight game!

Google search volume exemplifies this perfectly ⬇️ as the major sports have predictable highs and lows in line with the aforementioned season structure.

In the UFC, each week is a fresh slate that could turn into the biggest possible moment; 💥 exactly what happened this past weekend. As the last-second knockout landed in UFC 300, the internet was on fire, driving the digital footprint of the UFC 📱 to never-before-seen highs.

It also highlights the reliance on personalities in the sport. The UFC makes money primarily from “pay-per-view” buys where viewers pay a one-time cost to watch from home 🏡 and watching a card will normally cost fans between $70-$90.

That’s why fighters like Conor McGregor are so important, his polarizing personality draws huge viewership interest time and time again, directly correlating to more money for the UFC.

In other sports, leagues don’t see the positive benefits of a huge game until they use it as negotiation fodder in future TV contract deals.

In the UFC, the dollars flow in immediately. 💸

No union (no) problem 👷

The biggest difference between the UFC and other major sports is how and how much the athletes get paid.

The NFL, NBA, NHL, and MLB all have player unions that negotiate to earn roughly 50% of the league’s revenue each year. 💼

Not the case in the UFC. 

Fighters are paid relatively meager salaries 🤕 with bonuses for winning esoteric awards like “fight of the night” and “knockout of the night” on each card. 

So no revenue sharing? Yes and no. ⚖️

Fighters will see a small portion of the pay-per-view revenue only if they are in a championship fight. 🏆 The remaining athletes get none of that. When the dust settles, athletes go home with only 18% of league income. 

You can thank Dana White for that.

The headline-grabbing president of the UFC has built the product to be “league-first” and promotes an “exceptional incentive” to become a champion in your weight class. Hence the huge payout multipliers on the top fights. 🧮

While the economic model isn’t perfect for all the fighters, the league stays happy as they pulled in $1.3B in 2023 and boasted almost a 40% profit margin. 🤯

Many would say the strategy has worked. 

Take boxing for example, where there isn’t a central group creating fights. Each boxer’s “camp” negotiates payment terms for every fight which leads to immense delays and cherrypicked matchups. 🥱

By centralizing the promotion and scheduling of fights, the UFC has kept the ball rolling by hosting monthly, if not weekly, high-powered fight cards. 

Even during COVID, the UFC scheduled 27 fights between March 14th 2020 and April 17th 2021.

Were most of them in an empty gym in Vegas or Abu Dhabi? Sure. The point is they were committed to increasing their at-bats and it paid off. They recouped plenty of pay-per-view buys and even posted a 3.4% revenue yearly revenue increase in 2020. 📈

The model is vastly different from other sports but then again, so is the product. Many complain about fighter pay, and rightfully so, but Dana White and the UFC have proven their central promotion and league structure works well for the sport, and even better for the pocketbooks. 

Thanks for reading and have a great weekend!

— Claire and Riley