UFC Sponsorship PRT 466 - John Hawthorne

PRT 466 (001)

GNC & UFC Sponsorship ProposalJohn HawthorneDr. Michael Edwards

16Fall

October 24, 2015

Michael G. Archbold Chief Executive OfficerGNC Holdings Inc.300 Sixth AvenuePittsburgh, PA 15222

Dear Mr. Archbold,

The Ultimate Fighting Championship (UFC) would like to invite General Nutrition Center (GNC) to partner with and be an exclusive sponsor of the UFC with particular attention to UFC Title Fights. The UFC has an extreme passion for a healthy body and a healthy mind. Not only in our professional mixed martial arts fighters (MMA) but also the communities in which we live. GNC shares that passion for the betterment of the human body and personal health and we would like to invite GNC to join us in showcasing that healthy desire to audiences worldwide.

The attached sponsorship proposal highlights some of the potential opportunities that the UFC can offer to your organization including: direct involvement with professional MMA fighters, international media coverage, broadened consumer markets, and employee loyalty opportunities. On top of this, we have included other information on our events, and have therefore presented how our two organizations can create a mutually beneficial relationship.

The UFC is eager to explore this potential partnership that we believe will last for many years to come. We will solidify GNC as the top nutritional supplier in world by increasing both brand awareness and brand loyalty to our affiliates in the United States and internationally.

After thorough review of the needs and wants of GNC, The Ultimate Fighting Championship executive board has crafted this sponsorship proposal specifically for your organization. I look forward to the further discussion of this proposal with you.

Sincerely,

Lorenzo FertittaChairman/Chief Executive Officer

GNC & UFC Sponsorship Proposal 1

Ultimate Fighting ChampionshipOVERVIEW

The Ultimate Fighting Championship (UFC) is the world’s largest professional promoter of mixed martial arts (MMA) and features the top ranked fighters in the sport. The UFC produces worldwide events in 9 different weight divisions ranging from featherweight to heavy weight in the men’s division as well as strawweight to bantamweight in the women’s division. The UFC had its first event in 1993 in Denver, Colorado and has evolved and grown exponentially since.

In 2001 the UFC was a struggling sport brand that only held negative images in the national spotlight. That same year partners Dana White and Frank and Lorenzo Fertitta who are the founders of Zuffa, LLC which is now the parent entity to the UFC, purchased the dying brand of the UFC. Dana White still serves as the president of the UFC while the Fertitta brothers are still in control of Zuffa, LLC. Currently, the UFC produces more than 40 live events each year in over 129 countries and in nearly 800 million TV households in 28 different languages, as well as its own reality TV show and own video games.

BRIEF HISTORY

1993 – First UFC event held in Denver, Colorado – UFC 1 1996 – Senator John McCain claims UFC as “human cockfighting”

and urges it to be banned in all states 1999 – Gloves in UFC made mandatory as well as adopted the

Unified rules of MMA, eliminating “no-hold-barred” style fighting 2001 – Purchased by Zuffa, LLC and Dana White for $2 million 2002 – UFC 40 sold out MGM Grand and had over 150,000 pay-

per-view orders allowing UFC to gain positive mainstream media attention

2005- The Ultimate Fighter reality show begins, now the longest running sport reality show in existence.

2007 – Video game deal with THQ (now EA) to produce UFC: Undisputed

2010 – UFC 116 leads to over 1.5 million pay-per-view orders 2011- Secured 7 year broadcasting deal with Fox 2012 – First female UFC fighter, Ronda Rousey, signed


2014 – Signed 6 year deal with Reebok as worldwide outfitter of the UFC

UFC 193 Rousey vs. Holm 1 OVERVIEW

UFC 193 will be held on November 14, 2015 in Etihad Stadium in Melbourne, Australia. This title fight features two undefeated American women, current bantamweight champion and UFC sensation, Ronda Rousey, versus former kickboxing world champion and the number 8 ranked woman in the world, Holly Holm. This event, just like any other UFC Title fight features four undercard rounds before the main event. UFC 193 specifically features another women’s fight as well as three other men’s fights. This title fight is unique in the fact that there are two title fights in the same night, the bantamweight fight between Rousey vs. Holm as well as the strawweight fight featuring current champion Joanna Jędrzejczyk of Poland and Valérie Létourneau of Canada.

VENUE

UFC 193 is set to take place in Etihad Stadium in Melbourne, Australia also known as Docklands Stadium. Docklands Stadium is a retractable roof arena that has a capacity of 56,347 with room for expansion and additions of seats. This stadium opened in 2000 and cost $460 million to complete. It is primarily used for Australian Rules football and is the headquarters of the Australian Football League.


Stadium Features: Retractable roof Two large internal replay screens to display images and

advertisements External super screen 66 corporate boxes Premium Club membership area 700 2000 watt lights for arena illumination Can seat 74,000 people with additional on ground seating

1Focus of proposal is on UFC 193 (Title Fight) with ultimate goal of complete sponsorship.


Media CoverageUFC Title fights are only shown live on pay-per-view (ppv) cable or special cable providers such as:

FS1 Comcast ppv DirecTV Dish ppv Cox ppv Time Warner Cable ppv AppleTV Roku Xbox 1 PS4 UFC Fight Pass (only prelims) UFC TV

Title fights are also shown at local bars across the nation and UFC.com has a “bar finder” based on your zip code which shows you what bars in the area will be showing the fight.

OVERALL VIEWERSHIP

While it may seem limiting to only offer the events on pay-per-view, the UFC has seen great success in doing this. Obviously the well-known names result in more pay-per-view purchases. On average, a UFC fight will draw between 200,000 and 500,000 pay-per-view buys. With UFC 193 having Ronda Rousey in the title fight, it is likely to be a huge purchase yet again. In UFC 190 where Rousey knocked out Correia in 34 seconds, there were over one million buys on


pay-per-view worldwide. This is the highest number of buys for a UFC in event in UFC history.

SOCIAL MEDIA

On top of pay-per-view, the UFC 190 bout exploded on Twitter that Saturday nigh. It was the number one trending topic in the world with over 935,000 tweets about the event. It also attracted over 5 million searches on YouTube in the following days. The UFC is very present on Twitter, with @ufc having over 2.1 million followers as well as outspoken UFC President Dana White, @danawhite having 3.34 million followers. @ufc and @danawhite post often about upcoming events and information regarding specific fighters and news from around the UFC. Also having many international fighters only helps to promote the global brand that the UFC has become.

CELEBRITY APPEAL

Each UFC title fight draws in tens of thousands of people and in this group there are often celebrities. Celebrities from Justin Bieber to Will Smith can be found at a UFC title fight on any given night. The presence of these pop culture giants only further endorses the UFC as a desired brand that people want to associate themselves with.


Brand Compatibility COMPARING THE ORGANIZATIONS

The major characteristic of both the UFC and GNC that allows this potential sponsorship to become so successful is the mission statement of GNC, which states, “To continue to be the leading provider of products, services and information in the self-care and personal health enhancement market.” The UFC is also a leader in our field of entertainment. We are the leading MMA event producer and we strive to continue to stay in that spot and the only way that we can stay there is with our athletes. Our athletes

must stay in top condition or risk injury that could sideline them for some time. In order to do so, they must constantly be trying to enhance their health and taking care of themselves. Both of our organizations are household names when people think of physical fitness and personal health, GNC being the gateway to fitness and UFC athletes being the peak of the fitness world.


Another way that our organizations are similar is in the fact that we are both very open about what our products offer and what they do. In other words, there are no secrets. GNC publishes all the ingredients to all the products that they sell and by doing so they allow themselves to educate their customers

on what each ingredient does in the human anatomy. The UFC is similar in the fact that we are an open organization. We, like GNC take a consumer approach as well in our UFC Gym extension where we teach consumers MMA techniques and styles at their request in an attempt to explain the science and the strategy behind MMA and what our fighter’s bodies go through on a day-to-day basis.

Brand Compatibility

TARGET MARKET

The target market of the UFC since its inception into the sporting world has been young males ages 17-35. However the target market is now broadening to include both males and females ages 17-35 due to the addition of female fighters in the UFC in 2012. The UFC also has the unique opportunity to market strictly to MMA fighters in hopes that they will sign a contract and fight for us. This aligns directly with the target market of GNC that consists of males and females ages 18-45 with an interest in self-care and personal health. As both GNC and the UFC strive to better the lives of their consumers whether those consumers are fathers of two or trained MMA fighters, both

organizations are a great match to target the same overall demographic.

GNC & UFC Sponsorship Proposal

Both organizations emphasize physical fitness Both target the same age demographic (17-45) Both have a unique target market in families and

professional fighters but with the help of this sponsorship we can tap into new markets

8

GNC and the UFC are a great fit for each other when it comes to a partnering sponsorship. Both organizations could expect to see increased brand awareness, increased sales, and generous hospitality and employee loyalty benefits between organizations.

Sponsorship Benefits – Tickets All GNC employees will have discounted tickets to UFC Title

fights with coupon code so long as they are an active employee per availability

Private club room at all Title fights for GNC staff only Catered food and open bar Padded, comfortable seats with view of The Octagon LED TV’s in club room for

different views of the fight


Sponsorship Benefits – Brand PlacementMAJOR SPONSOR: Will always be announced as a “major sponsor of the UFC”

LOGO: Access to UFC logos and trademarks to place on GNC products

SIGNAGE: Will receive signs at all UFC Title fights along with ability to have floor logo in the Octagon

BOOTH: GNC will grow their brand awareness by being allowed to set up booths with merchandise and product for sale and sample at every GNC event.


Sponsorship Benefits – Brand PlacementDIGITAL SIGNAGE: Will receive space for digital signage on ribbon, jumbotrons, and outside screens

ELECTRONIC: Will have GNC logo included in newsletters and other advertisements sent out as well as on UFC homepage


Sponsorship Benefits – Brand Placement

ANNOUNCEMENTS: Will be verbally announced as exclusive sponsors throughout entirety of fight

COMMERCIALS: Will be seen in UFC commercials as “official sponsor of UFC”

CLIENT SPONSORSHIPS: Will have opportunity to meet with UFC athletes and discuss GNC specific contracts in order to sponsor the individual fighter.


Sponsorship Benefits – Hospitality & Employee LoyaltyLIVE WELL NIGHT

One Title fight per year GNC will have the opportunity to fly their top 5 salesmen from each state to a UFC Title fight on UFC’s behalf

UFC will recognize these employees in between undercard fights before the main event

GNC will improve employee loyalty and provide more incentive to sell to customers

In return, UFC employees and fighters would get the opportunity to purchase GNC supplements at cost for the month leading up to the Title fight.



Sponsor Investment

GNC & UFC Sponsorship Proposal

TOTAL PACKAGE VALUE: $500,000

ACTUAL SPONSORSHIP INVESTMENT:

15

EvaluationSURVEYS

At the end of each Title fight surveys are emailed to patrons asking how they enjoyed the fight

We would re-create the survey in order to include questions about GNC and the perceived brand image that they may have

SALES NUMBERS Monitor GNC sales before and after a UFC Title fight and record

change Record GNC booth sales at UFC events See if sales incentive of free UFC fight is increasing sales as a

whole Record international sales before sponsorship and after to see

change

EMPLOYEE SURVEYS Send our surveys to current GNC employees and ask what they

think of the UFC currently and how it could get better Gauge the happiness of the employees that UFC is a partner with

GNC Use survey to see if incentive of free UFC fight is actually an

incentive or not

MEASURE MEDIA EXPOSURE Record number of time GNC and UFC are mentioned together in

local, national, and international media due to partnership.



Documents

UFC Sponsorship PRT 466 - John Hawthorne