What impact will Reebok deal have on UFC?

UFC president Dana White. (AP)

For months it was the secret many speculated on, but the word is officially out: The Ultimate Fighting Championship has signed a six-year deal with powerhouse Reebok.

The UFC made it clear that this new “outfitting deal” is the biggest non-broadcasting deal they have ever signed — larger than agreements with Budweiser and Harley Davidson.

The full terms and details of the new deal were not disclosed, but the basics are as follows:

There will be a consistent look for all athletes competing inside the Octagon but individuality will be allowed, with the option to select from different colour schemes to the types and styles of shorts, be it board shorts, tighter fitting trunks and even skorts for women.

With this new sponsorship deal, active fighters will be compensated on a per fight basis under a a five-tier system. Champions will be paid the most, followed by those ranked 1-5, 6-10, 11-15 and down to those outside the top 15.

It’s capitalistic in nature. To make more money, you have to move up the ladder. In essence, the more success one has in the Octagon, the more they will be compensated by this new Reebok deal.

There are also plans to bring in a “legends line,” so those who have had success in the past will benefit from this new deal.

Merchandise will be designed, manufactured and made available to every fighter with a royalty paid on items sold, be it in the over 10,000 retail spaces where Reebok can be found or online where consumers can (sort of) compensate their favourite fighter with their own money.

This deal is somewhat similar to what exists in the overall professional sport landscape. While the UFC is not a team sport, the organization’s goal is to make it look similar and in a sense more professional than the perception that exists today.

The fighter and their corners will be outfitted in the same gear selected by the athlete. In time, the UFC will have an equipment manager at every event whose role will be to provide the fighter with the required gear for fight week. This would include items like shirts, shorts, underwear, hats, socks, sports bras etc.

There is a planned unveiling of the new Reebok/UFC products scheduled for the spring of 2015, with the uniforms debuting in the Octagon during International Fight Week in July.

What does this mean for the current sponsorship landscape?

For starters, those banners you see behind the fighters during their introductions? They will be eliminated.

Shorts covered with various local and national sponsors? This will no longer be allowed. What will happen is one logo will be permitted, and it will be a title sponsor. Think European soccer uniforms.

Fighters can keep any and all sponsors they currently have or choose to sign with in the future. But visibility of those sponsors inside the Octagon will not be allowed. Think GSP and Under Armour, or Sidney Crosby and Sport Chek.

But many questions have yet to be answered by the UFC and Reebok.

How much of the profit will be dispersed to the athletes?

Will it be more than what they could have garnered on their own, if they were allowed to sell space on their banners and shorts? Or is the headache of sponsorship recruitment and actually getting paid finally addressed by the amount of funds they will get from this new deal?

If the athletes want to make more money by being a UFC fighter, this deal will force them to make MMA more of a full-time job — one that will allow them to take their personal brand to a new level in hopes of making the fan base care about them, as a fighter. Emotional investment often turns into financial compensation.

But will the UFC lend their name and logo to aid fighters in their quest to pad their bank accounts outside of the Octagon? If a certain fighter is set to make a paid appearance, will they be allowed to say they are a UFC fighter on, let’s say, a promotional poster for an establishment or expo they may be signing at?

Believe me, I’ve heard many stories where the UFC logo was not allowed to be used in such a manner, even after original artwork had been printed. The UFC takes their trademark very seriously and will not blink an eye to fire off a cease and desist letter.

It appears to be a complicated puzzle that has yet to be fully pieced together. On the surface, despite some of the negative feedback, it will be a game-changer.

But in the never-ending quest to raise the bar for fighter compensation, no one knows (yet) if this is one of the answers. It may very well be, but it will take time to figure it all out.

That usually comes after the first cheques are written and the information gets out to the media.

Hopefully, both the UFC and the fighters make a lot more money with this deal, while Reebok is able to benefit from it as well. If all parties end up happy in the end, no one will argue this deal was truly a game-changer for the sport of MMA.

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