How cornering your market can get you $1,000,000 in 30 minutes
Think about this for a minute – would you like to sell 10,000 or more tickets (or products) within 30 minutes of your launch? What about if I told you there’s even more revenue to be made from those same sales? Well, that’s exactly what Zuffa did when the UFC sale for the Vancouver date sold out in 30 minutes through their UFC Fight Club memberships. The memberships alone are $74.99 a year, which gives people access to pre-sale ticks and a bunch of other stuff. In other words, they made a HELL of a lot of money.
Lets say that they sell 10,000 tickets and each ticket averages $100. That’s $1,000,000 from just the ticket sales. But where the real money (in my opinion) comes in is the Fight Club memberships. If 10,000 tickets sold out in 30 minutes because all of the fight club members bought them, we’re going to have to estimate that 10,000 people are a part of the Fight Club.
So, by taking those 10,000 members and multiplying that by the $74.99 per year fee, the Zuffa company is making $749,900 in just the memberships. So, for this event, they’ve essentially made $1,749,900 from the sale of the tickets without even selling to the public. Pretty impressive right?
The big takeaway, in my opinion, here is that the UFC cornered it’s market and it’s essentially impossible for anyone to buy a ticket to the fights unless they’re a member of the Fight Club, thus driving sales up of the Fight Club and also driving up the anticipation for the minute that tickets go on sale, because nobody wants to miss their chance to get a ticket (or two).
Why the UFC Fight Club memberships are so valuable to the members
It’s simple actually; they get access to the tickets before anyone else. The people who buy the memberships are the people who buy the tickets (generally), so they’re already sold on the idea ahead of time, which is a good business move for Zuffa (the company who own’s the UFC). The membership to the fight club ensures that these ticket buyers are first in line to buy their tickets before the general public can get their hands on them so it gives them the feeling of being a part of something special – because they are special. So, by doing this, they’re more likely to buy the tickets, spread the word about the UFC and get their friends to buy the Fight Club memberships.
Do we know for sure there are 10,000 members in the Fight Club?
Nope. My estimation is that there are probably more than 10,000. The ticket buyers are from all around the world and buy the tickets when the UFC comes to their town, or country, so you’ve got to guess that there are more than 10,000 people signed up to the fight club. What does this mean for Fight Club sales? It means that the money the UFC is making off of the Fight Club memberships probably exceeds the million dollar mark yearly.
How can you apply this to your business?
With your business, do you have a list yet? Do you have a membership based business? If not, you could consider building a membership based business on top of the business you already run. For instance, if you’re into selling premium design products like Media Loot, you should have a membership and not just one-off sales like iStockphoto has. With Media Loot, they’re able to bring users in, and through releasing killer resources, keep their users for months, which turns into a passive income stream.
You do need to ensure that your membership is worth it before you launch it though. For instance, with Giant Themes, I currently only have two themes available. Nothing to really jump up and down about if you’re buying a membership. So, I don’t currently offer membership’s, but as I build more themes I will put a membership into place. A good number (in my opinion) for me to hit before the membership’s are rolled out is 10 commercial WordPress themes.
This may take some time, but by building the marketing around my company and by releasing high quality themes, by the time the membership base is rolled out, there will (hopefully) be many people lined up and excited about the membership launch, which in turn means more revenue for me right from the jump.
What are your thoughts?
I’d love to hear your thoughts on the subject. I am only one person with one view, so I’d love to get everyone elses opinion on the membership model that the UFC has built up and any ways you could see it being better in the future. Also, if you run a membership based business, I’d love to get your thoughts on the subject as well.
