The economy is delivering a killer right hook: For the first time ever, a promoter of a marquee boxing match is offering national rebates on its pay-per-view rates.
The Oscar de la Hoya versus Manny Pacquiao boxing match scheduled for Dec. 6 was supposed to be the biggest pay-per-view event of all time, but promoters aren't so sure now. The expectations that de la Hoya's promotional company, Golden Boy Promotions, had for the fight have been tempered due to the slowdown in the U.S. economy.
"Sometimes, economic situations make you think about certain things that you maybe wouldn't think about," said Richard Schaefer, chief executive of Los Angeles-based Golden Boy.
The current economic decline led Schaefer to ask his sponsors to find ways to activate their brands nationally to promote the fight. In an unprecedented move, sponsors will offer rebates nationally to the pay-per-view telecast.
The fight will be available on HBO pay-per-view for $54.95. Tecate Beer and Casadores Tequila each are offering $20 mail-in rebates, while Coca-Cola's Full Throttle Energy Drink brand has a $10 mail-in rebate promotion. A customer could get $50 worth of rebate checks, although he'd have to buy the products.
Tecate has provided coupons for mail-in rebates for several Golden Boy fights in the past, but only in certain regional markets. Those promotions increased viewership and Golden Boy noticed, according to Carlos Boughton, Tecate brand director.
"Results were always higher than what they were expecting," Boughton said. "For the upcoming fight, we have an unprecedented promotion at the point of sale."
Such promotions are expected to push the fight's revenue to more than $100 million, making it the highest-grossing fight of 2008. Other revenue includes $17 million from ticket sales, plus sponsorships, closed-circuit television revenue and foreign rights.
Offering pay-per-view rebates was not part of the original plan for this bout, but Schaeffer said doing so will increase advertising and add value for the fight's sponsors. He expects future matches promoted by Golden Boy to include a mail-in rebate offer from sponsors, even after the economy eventually turns around.
"It's great for the fans and for the sponsors that are aligning their brands with boxing because they get additional exposure," he said. "When the world goes through economic turmoil, businesses come out stronger and more efficient."
For sports equipment manufacturer Easton Bell Sports Inc., the third quarter was a challenging time to sell consumer products. Nevertheless, the Van Nuys-based company saw significant growth in its sales of hockey equipment, which helped boost revenues by 7.8 percent to $204 million.
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