Fighting talk: Inside IMG Arena’s data and product deal with UFC

UFC in many ways is the perfect vehicle for online betting. The sport itself is explosive, dramatic and easily clipped into viral highlights for social media, while the target audience is overwhelmingly male and relatively young, and thus very likely to bet.

UFC itself is also digitally native. Every fight is built up with dedicated hype videos and concepts like UFC Embedded – an online series following fighters in the week leading up to the fight – provide uniquely engaging content in a way boxing never has.

In other words, UFC is already talking to customers via digital platforms constantly and adding betting to that communication is a natural evolution. Enter IMG Arena.

The division was created in November last year to be the betting arm of global media giant IMG. Its initial US focus has been on tennis and the PGA Tour, but UFC was also a natural bedfellow, with the MMA organization owned by parent conglomerate Endeavor.

IMG Arena is looking to develop what it claims will be the world’s first fully sports-branded betting product that it will in turn sell on to operators. EGR North America sat down with IMG Arena EVP and managing director, Freddie Longe, to find out more about the company’s ambitions for UFC.

EGR North America (EGR NA): How did the idea come about?

Freddie Longe (FL): Firstly, it is important to point out that UFC is part of the Endeavor Network (formerly known as WME-IMG, the holding company for its brands). As such, there’s a pre-existing warm relationship. But when we look at the spectrum of sports, and how they are serviced in the sports betting space, UFC feels like it’s a sport that has very strong potential but comes with challenges.

Our aim is to fix those challenges on behalf of UFC and ensure they stand to benefit from a buoyant US sports betting ecosystem.

IMG Arena is looking to develop the world’s first fully sports-branded betting product

EGR NA: What are the strengths of the sport from a betting point of view?

FL: I think first and foremost UFC is a very, very powerful brand that resonates extremely well with its loyal fan base. I think secondarily, when you look at the demographic, as many as 75% of fans are male and in the 18 to 44 age category, meaning they have a strong propensity to bet. When you compare UFC fights to a lot of other sports they get as little as 8% or 9% of volume in-play, as opposed to around 55% in some cases, or even higher for other sports.

There isn’t the same volume of events that you see in tennis for example, or indeed as golf, soccer or basketball. And then you compare UFC fights to a lot of the other sports; they get as little as 8% or 9% of volume in-play, as opposed to around 55% in some cases, or even higher for other sports.

Another issue is the subjectivity of a lot of the sport and scoring things like knockdowns and significant strikes. To build more granular, engaging products in-play you need clear official data, so operators feel comfortable offering and settling bets on these new market types.

So there has been a lot of work on that behind the scenes. The actual service itself is the amalgamation of several different feeds, one of which is specifically designed to be fully real-time and fully official – to create fertile ground for that volume of betting opportunities to be increased.

EGR NA: Did IMG Arena and UFC feel it was important to have an official feed for the sport in the market?

FL: Without getting too much into the official-versus-unofficial data debate, we certainly know this is a topic being debated within the US market on a stateby-state basis.

With UFC being part of the Endeavor platform, it’s important they have an official data feed, so that, if it is mandatory in any given state, there is a feed that can be deployed that meets the requirements of the market.

So, we flagged that to them. But then we also identified an opportunity for them to try and get more involved in the growth of the in-play betting space through the creation of a product set that can stimulate that.

EGR NA: Do you see official data as more important in the US than in other markets around the world?

FL: As a business, IMG was founded in the 1960s and has always been led by the needs of its rights holder clients. Our DNA lies lies sport. We want to monetize and commercialize the assets of rights holders to the greatest of our ability, but at the same time we are committed to delivering value to our sportsbook customers. How can we bridge the gap between sport and sports betting is the lens we use when developing our growth strategy?

The unique opportunity that we have is to incorporate things like UFC’s brand into our product’s increasing levels of fan engagement, and deliver incremental value to both stakeholder groups.

LAS VEGAS, NV – AUGUST 19: UFC featherweight champion Conor McGregor poses on the scale during his weigh-in for UFC 202 at MGM Grand Conference Center on August 19, 2016 in Las Vegas, Nevada. McGregor will meet Nate Diaz in a welterweight rematch on August 20, 2016, at T-Mobile Arena in Las Vegas. (Photo by Ethan Miller/Getty Images)

EGR NA: We’ve seen deals between US sports leagues and MGM for the use of official logos on sportsbooks, but you are going one step further with UFC branding here?

FL: We are creating what we believe is the first-of-its-kind branded event center. This is the very first time a sports betting product has been branded, with not just a logo but a fully branded product with UFC imagery, complete with colors and everything.

We’re also looking to live streaming, which is a very popular and growing product from a sports betting perspective. There’s a lot of visualization tools out there in the marketplace but, to our knowledge, there isn’t one that contains the brand, which we think will resonate well with the fans and breed trust and therefore fan engagement, and ultimately turnover and GGR on behalf of our customers.

EGR NA: While not as data rich as some US sports, there’s still plenty of statistics in UFC to help build betting products compared to, say, boxing?

FL: UFC is obviously the amalgamation of many different disciplines so there are more statistical data points that can be extracted, but I think it started with the same challenges as boxing did where a lot of it is subjective.

So, as I said earlier, we’ve spent a lot of time working out the official designation and statistics to give our customers comfort to offer and settle bets for new market types.

EGR NA: Endeavor bought UFC for around $4.2bn back in 2017 – is the sport still growing?

FL: I think it’s well documented that it’s one of the fastest, if not the fastest, growing sports around. It’s just overtaken the NFL on Instagram as having the largest following at around 15 million. The UFC Fight Pass is one of the greatest pay-per-view success stories in the sports media space as well.

Anecdotally, at a recent gaming industry event, we were canvassing about the size of turnover on a high-profile UFC fight compared to boxing and were told UFC is around 10 times the size. We think that’s significant and when you consider that 90%+ of that is pre-event, we think there’s a good opportunity with our event center and official data feeds to create a lot of value within that in-play segment.

EGR NA: What sort of appetite for a UFC betting product have you seen from operator partners?

FL: There has been a significant amount. The US, Latin America, Australia, Russia and CIS are all very fertile UFC markets. Certainly, UFC has been seeking to expand the footprint of their events so that there’s a true global spread. It’s a brand and a sport that is now resonating strongly around the world and not just in the US market. So, appetite is strong for the product for multiple reasons.

To my earlier point, the demographic is absolutely perfect for the mainstream sports betting user. That’s why a lot of the premium brands – betting or otherwise – from around the world are looking to associate themselves with UFC.