“We’re In The Business Of Emotional Currency”: UFC’s Rene Valencia

“We’re In The Business Of Emotional Currency”: UFC’s Rene Valencia

In just 15 short years, there’s no denying the UFC has come a long way has a brand, but the event series still as a way to go to change its perception of being violent to “wholesome”, according to its vice president of international partnerships.

Huntley Mitchell
Posted by Huntley Mitchell

Speaking yesterday at the Ministry of Sports Marketing conference in Sydney, Rene Valencia started of his keynote presentation by noting that despite its meteoric rise, the UFC is not exactly an easy sell.

Rene Valencia

Rene Valencia

“We often come across brands that don’t want to be associated with a combat sport – they don’t want blood on their logo, they think the sport’s violent – and to be completely honest, it is,” he said.

“But what happens inside the Octagon is just 10 per cent of the journey, and what I’m out there selling to brands is the journey to the Octagon.

“When I’m talking to brands and potential partners, we talk about the human link of the UFC that really brings our brand to life. Apart from the media values and the various sponsorship metrics that all the brands measure for and ROI, we talk about what is really different for the UFC, which is its ability to connect with humans, and the fact that we’re all fighters.

“Whether you’re fighting to get up in every morning to get to work, fighting against an illness, or fighting to put together a script last minute for a presentation, every day there’s a constant battle in what we do.”

Valencia said that while the UFC does value its marketing partnerships, content – which it owns and produces all of, and is led by a global roster of athletes such as Conor McGregor, Ronda Rousey and Aussie Robert Whittaker – is king for the brand.

“Within the UFC, we believe we’re in the business of emotional currency. We’re selling passion and a pride in the sport that we believe no other sport has,” he said.

“Our business is built on a short 15-year history of accelerated and rapid growth, it’s built on innovation and it’s really built on content.”

Monster sponsors

Valencia said his primary focus for the UFC is to drive annualised deals with sponsorship partners, which he finds a lot easier than per-event deals.

“A $50,000 sponsor for one event is 10 times harder to service than a four-year deal worth $5 million because they probably have smaller pockets, they’re much more interested in their return on investment in a very short period of time, and they’re not truly investing in the long-term future of the brand in sport,” he said.

Energy drink brand Monster is one of the UFC’s biggest sponsors globally, paying for endorsement deals with 13 of its 400-plus contracted athletes.

Here in Australia, Tabcorp is numero uno in the UFC sponsor stakes with an annualised deal that runs through to the end of 2019.

“Tabcorp does a fantastic job for us in activating digital,” Valencia said.

“You can go into their retail outlets – whether that’s their point of sale in licensed premises – and you’re able to win trips to Vegas to experience the UFC, attend UFC events in Australia, you’re able to bet on the UFC in all states except Victoria.”

What’s next?

With the Western Australian government recently overturning the ban on the Octagon, Valencia said Aussies could see a pay-per-view UFC event in the new Perth Arena as early as February 2018.

The UFC also plans to expand its business lines across all cities Down Under, and is set to announce new sponsors in the next three months.

“We’re leaning heavily on branded content,” Valencia said. “One of our partners will be producing live training sessions out of the performance institute in Las Vegas, streamed back to their Australian audience through social media.

“The other thing you’ll see is the potential launch of a UFC store in Sydney or Melbourne. It’ll be a completely branded content store with interactive technology.”

The ‘Money Fight’

The fight between McGregor and boxing legend Floyd Mayweather is being touted as one of the biggest events in sporting history, and is certainly the biggest event on the UFC’s calendar this year.

The 'Money Fight' (Floyd Mayweather v Conor McGregor)

Valencia said that if you look at the numbers from a commercial standpoint, the projections are beyond all previous fight events.

“We’re looking at a US$77 million gain at TW Arena. On the low side, we’re looking at a US$600 million per-per-view buy globally, and in my area we’re trying to get to US$20 million,” he said.

Looking beyond the McGregor-Mayweather fight, Valencia said the UFC looking to continue to shift the brand from being “a little misunderstood or feared at times to something that’s more wholesome”.

“We’re not going to get Milo into grassroots sponsoring anytime soon, but I believe we can move into grassroots here if we grow the brand in the right way through the right vehicles,” he said.