Exiled from UFC, apparel sponsors like Hayabusa must get creative in Reebok era

By Newsroom on September 29, 2015
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  • When Craig Clement heard that Reebok would soon be the exclusive apparel sponsor of the UFC, forcing all other brands and their logos off UFC broadcasts for the foreseeable future, he knew he had a potential problem.

    Clement is co-president of Hayabusa, a technical equipment brand that makes gloves, shorts, shinguards, focus mitts – basically everything the serious mixed martial artist needs inside the gym. His was one of the few companies that got to show off its actual product on those it sponsored. When former UFC welterweight champion Georges St-Pierre sported the Hayabusa logo on fight night, it was on a pair of Hayabusa shorts.

    Now, thanks to Reebok, that exposure is going away, which meant closing Hayabusa’s best avenue to the large, dependable population of martial arts enthusiasts that each UFC broadcast brings.

    “With the fighters in the UFC being off-limits now in terms of in-ring sponsorship,” Clement told MMAjunkie, “we had to look outside that.”

    It’s a puzzle many longtime UFC sponsors have spent the last six months trying to solve. After depending on the power of UFC broadcasts for so many years, how do you replace that exposure now that it’s the sole property of Reebok? How do you remind UFC fans that you’re still alive and kicking if you can’t get your logo or your gear on UFC fighters when the cameras are on them?

    Clement solved the Reebok problem by, in a sense, taking a page out of the Reebok playbook. Instead of simply looking for other fighters to sponsor, Hayabusa looked for another organization.

    It found what it was seeking in GLORY kickboxing, Clement said. Beginning in August, Hayabusa will be the exclusive provider of gloves in all GLORY bouts, thanks to a three-year deal that Clement hopes will more than make up for what his brand is losing with the UFC, if only because this will allow Hayabusa to show more of what it’s actually selling.

    “We get a lot of calls from UFC fighters wanting to wear our equipment to train in,” Clement said. “It happens all the time, guys calling and saying, ‘Can you please send us your stuff?’ We never got to show that on the (UFC) broadcasts. We’re known for all our equipment, but especially our gloves. GLORY just made sense.”

    It’s a creative solution to a problem that many longtime UFC sponsors are facing. While UFC executives have repeatedly assured fighters that they can keep their sponsor outside the cage, many of those brands aren’t so excited about continuing to pay top dollar for athletes who can’t even represent the company at pre-fight weigh-ins, much less a fight night broadcast.

    This is the issue that Dethrone founder Nick Swinmurn faced when his company sat down to renegotiate its deal with UFC featherweight title contender Conor McGregor in the wake of the Reebok news.

    The initial deal with McGregor had gone well, Swinmurn said. But with the Reebok era looming, no one knew quite what the sponsorship landscape for UFC fighters would look like once they were all required to wear the same company’s gear at all fight week events.

    “It was a weird negotiation,” Swinmurn said, “because on their side they were saying, ‘Nothing’s going to change. The walkout’s irrelevant anyway. What drives sales is social media.’ We were sitting there saying, ‘I don’t know, we see a spike after broadcasts.’ The thing was, how could we really negotiate a good extension when none of us even know what we’re negotiating?”

    When MMAjunkie spoke to Swinmurn shortly after the UFC’s deal with Reebok became public in December, he said his company might take a closer look at fighters in other organizations, like Bellator. Since then it’s done just that, Swinmurn said, signing deals with fighters like Bellator lightweight champion Will Brooks. It also has a deal in place with recent Bellator acquisition Aaron Pico.

    “For us it’s always been about, ‘Can we sign guys who will move the needle?’” Swinmurn said. “Most guys won’t move the needle. Just the appeal of being on a UFC broadcast, I think that lost its cachet in 2010, 2011.”

    Among fighters, at least, the biggest winners in the UFC’s Reebok deal may turn out to be those in other organizations. Many of them were previously ignored by the big MMA-centric apparel companies, either because the exposure of a Bellator broadcast on Spike TV wasn’t considered a worthwhile investment, or because, according to Bad Boy CEO Robin Offner, “you were also foreclosed from going into any of the other leagues by the contracts the apparel brands signed with the UFC.”

    Now Bad Boy and other apparel companies like it have been forced to reconsider. Since the Reebok deal was announced, Offner said, his company has “been targeting other fighters in other leagues, who fit our sponsorship model, and we’ll be starting that probably next month.”

    It’s also had to get a little more creative in certain ways just to get the most out of its existing relationships with UFC fighters.

    Take the UFC Fan Expo, for instance. While Offner said he had long questioned the value of setting up a booth at one of the UFC’s expos, other apparel brands seemed to take offense when told that they wouldn’t be welcome at next month’s expo in Las Vegas, prior to UFC 189.

    “We have sponsored some of the biggest names in the sport on their way to the top and have always put the fighters first,” Fight Chix designer Jake Nuesser wrote in a blog post lamenting the move. “Always.”

    Even for a bigger company like Hayabusa, “It was upsetting,” Clement said.

    “We did that show every year,” Clement said. “When we were told that we’d no longer be able to be there, it was a surprise. I mean, I understand that the Reebok deal was going into play, but for other brands to not be permitted to do the expo, I don’t know what that expo is going to look like.”

    But Offner said his company had solved the problem in much the same way many brands will soon have to attempt in order to leverage their relationships with fighters outside the octagon.

    Instead of setting up shop at the expo, last year Bad Boy made its own arrangements with retailers inside nearby casinos. Bad Boy’s sponsored fighters would be in town anyway, as would UFC fans. So why not stake out your own spot nearby?

    It’s a small example of what the company’s strategy will be going forward, in terms of marketing to fight fans, Offner said.

    “People are still going to buy MMA products, and I don’t see the MMA consumer flocking to Reebok,” Offner said. “So they’re still going to choose among the core brands that have built brand equity in this space. The place where it would hurt us more is in reaching the non-MMA fan, the lifestyle consumer that sees the brand on TV, but a lot of those other brands don’t cater to the lifestyle consumer. The hardcore customer is not going away. Reebok is not going to suddenly take 90 percent of the hardcore MMA base. I’d be surprised if they take a large chunk out of anybody’s business.”

    The question is, where does that leave the fighters? Offner said Bad Boy has maintained most of its existing sponsorship deals with UFC fighters, but it’s been forced to restructure those deals now that fighters can no longer represent the brand inside the octagon.

    That means less money for fighters, who were previously receiving per fight bonuses from Bad Boy in addition to their monthly salaries. Now that they can’t wear Bad Boy on fight night, those bonuses are disappearing.

    “I think most of the fighters will suffer,” Offner said. “It’s not good for most fighters. It’s good for the fighters that aren’t getting sponsors. They’re in the UFC for a short time, nobody knows them, they weren’t getting any money, and now they get $2,500 or five grand or whatever. The caliber of fighter that we would be building around, those fighters are going to take big hits. A lot of the fighters are taking big hits. It’s going to change their lives.”

    Then again, for brands that have long factored UFC-related expenses into their budgets, it does free up cash to spend in other places, such as Hayabusa’s deal with GLORY, which it might never have sought out if it hadn’t been forced out of the UFC.

    “We were paying the UFC this sponsorship fee just to be permitted to speak with their fighters,” Clement said. “That alone, you save those kinds of funds, then the sponsorship itself, and we sponsored probably five to 10 guys on every card. It adds up. That’s a lot of freed-up marketing dollars that we’re going to move around.”

    Already some of those dollars have found their way to GLORY, and more will land in the pockets of individual GLORY fighters on a fight-by-fight basis, Clement said. Some of the rest will likely end up in Bellator.

    And, yes, some will stay with UFC fighters, such as heavyweight Todd Duffee, who fights Frank Mir at UFC Fight Night 71. Of course, since that fight takes place on July 15, Clement said, Duffee won’t be able to represent Hayabusa on TV.

    “But we’re still working with him,” Clement said. “We still want to be part of MMA, whether that be with UFC fighters outside the octagon or with fighters in other organizations, such as Bellator.”

    Source : www.mmajunkie.com