I collected responses for another survey that measures Net Promoter Score.
The results from the study done in late December to early January were published in the Wrestlenomics Pro Wrestling Industry Report (available via Payhip and Patreon).
I obtained responses through a Facebook ad again, to hopefully obtain a more random sample. I’m considering using Google Ads too in the future.
Monetary support from patrons made this study possible. Hopefully as we continue to produce valuable research, we produce a flywheel effect that drives interest and allows further investment in surveys and other research like this.
I plan to continue to do the NPS survey, maybe every quarter, so we can collect data points over time and evaluate trends. Below you’ll see the beginning of that as we now have two data points over time (for December/January [will be referred to as “December” for shorthand] and March).
It’s notable that the wrestling companies this time were listed in random order. In the previous survey, the wrestling companies were listed in this order for all respondents: WWE Raw, WWE Smackdown, WWE NXT, AEW Dynamite, Impact Wrestling, Ring of Honor, New Japan Pro-Wrestling.
The New Japan sample small enough to not take very seriously, but it’s plausible that appearing last for all respondents in December and appearing in a random position for each respondent in March contributed to the lower scores for New Japan in December and higher scores for the company this time.
I discovered it’s probably more fair to break out regular viewers’ sentiments from those of occasional viewers, rather than combining them as I did earlier. Regular viewers, as you might expect, tend to be more positive toward the program they watch than occasional viewers. Plus, some programs’ respondents are mostly regular viewers (like WWE main roster shows and AEW) and others (like ROH and New Japan) were mostly occasional viewers. A relevant breakdown will be displayed below.
With the prospect of full capacity live events and hopefully a return to normal life on the horizon, I included in the same survey form a question about the respondent’s willingness to be vaccinated against Covid-19. Results for that are also displayed below.
Although I spent a similar amount of money on the Facebook ad this time, only about half the number of samples were collected. The sample was also adjusted for disparities in race and gender, as compared to reports of viewership data.
Instead of targeting multiple major English language countries, this time I decided to focus on the United States only. Therefore the December results were filtered to responses from the U.S. only.
NPS results for March 2021
Click to enlarge view
NPS results over time:
Regular and occasional viewers
“Dec 2020” here refers to responses collected between December 30, 2020 and January 3, 2021.
Regular and occasional viewers
Regular viewers only
Regular viewers only
Occasional viewers only
Occasional viewers only
Lapsed viewers only
Lapsed viewers only
How willing are U.S. wrestling fans to get vaccinated?
The below chart measures responses only from U.S. adults aged 18 years or older.
Realizing there may be other factors that consistently coincide with vaccine willingness, information about age, education level, and household income was also collected and shown below.
Click to enlarge view
These results are comparable to the general public in the U.S. According to a study by Pew Research Center in February, 69% of Americans said they would probably or definitely would get vaccinated or already had at least one dose.
Political affiliation
I anticipated political affiliation might relate to vaccine willingness, and it does among respondents to this study. Respondents who identified as Republicans were 8x more likely than Democrats to say they won’t be getting vaccinated. Nonetheless, as you can see above, I didn’t find strong differences in vaccine willingness among viewers of different wrestling programs. Nor did I find strong differences in political affiliation about viewers of different programs.
Brandon Thurston has written about wrestling business since 2015. He’s also worked as an independent wrestler and trainer.
This article is available ad-free for everyone because of support from our subscribers.
WWE Smackdown, WWE Raw, AEW Dynamite, WWE NXT, and Impact Wrestling television viewership update for seven days beginning March 11 and ending March 18, 2021
The Basics
WWE Smackdown last week Friday on Fox was watched by 2,171,000 viewers. It had a P18-49 with a rating of 0.61 (795,000 viewers).
WWE Raw on Monday on USA Network was watched by 1,843,000 viewers, the fewest since February 15. It ranked #1 on the day on cable in P18-49 with a rating of 0.56 (727,000 viewers).
AEW Dynamite last night on TNT was watched by 768,000 viewers. It ranked #6 on the day on cable in P18-49 with a rating of 0.28 (360,000 viewers).
WWE NXT last night on USA Network was watched by 597,000 viewers, the fewest since February 10. It ranked #42 on the day on cable in P18-49 with a rating of 0.13 (170,000 viewers).
Impact Wrestling on Tuesday on AXS was watched by 146,000 viewers. It ranked #135 on the day on cable in P18-49 with a rating of 0.04 (about 50,000 viewers).
Remarkables: viewership demographics that were +/-10% compared to the median of the last four weeks
WWE Smackdown’s reported demos were all within 10%.
WWE Raw’s reported demos were all within 10%.
For AEW Dynamite, adults over age 50 were up 15%, adults aged 18-49 were down 14%, women aged 18 to 49 were down 23%, men aged 18 to 49 were down 11%, young adults (aged 18 to 34) were down 18%.
For WWE NXT, young adults (aged 18 to 34) were up 14%, total viewership was down 15%, adults aged 18-49 were down 28%, men aged 18 to 49 were down 42%, adults over age 50 were down 14%.
Impact Wrestling’s reported demos were all within 10%.
Versus median of the last 4 weeks (objective: “How out of the norm was this result?”)
Demographic
WWE Raw
WWE Smackdown
Impact Wrestling
AEW Dynamite
WWE NXT
P18-49
-2%
+5%
0%
-14%
-28%
F18-49
+3%
-23%
-8%
M18-49
-3%
-11%
-42%
P18-34
+5%
0%
-18%
+14%
F12-34
+29%
+5%
+40%
M12-34
-6%
-12%
+5%
P25-54
-4%
+6%
-12%
-29%
P50+
-1%
+15%
-14%
P2+
-4%
+2%
-7%
-3%
-15%
But all TV ratings are down! How are wrestling programs trending compared to television viewership generally?
In total viewership (P2+) the top 50 non-news cable programs are down 21% compared to the same 13 weeks a year ago.
By the same measure, AEW Dynamite is down 15%. Impact Wrestling is down 17%. WWE NXT is down 8%. WWE Raw is down 21%. WWE Smackdown is down 9%.
In P18-49 viewership, the top 50 non-news cable programs are down 29% compared to the same 13 weeks a year ago.
By the same measure, AEW Dynamite is down 9%. Impact Wrestling is down 2%. WWE NXT is down 27%. WWE Raw is down 25%. WWE Smackdown is down 17%.
Brandon Thurston has written about wrestling business since 2015. He’s also worked as an independent wrestler and trainer.
This article is available ad-free for everyone because of support from our subscribers.
All Elite Wrestling’s “Revolution” event on Sunday, March 7, set a new pay-per-view record for the company, based on early estimates. The event likely attracted about 125,000 buys worldwide, across both digital and traditional platforms.
Wrestlenomics estimate of All Elite Wrestling pay-per-view buys, worldwide across all platforms, traditional and digital
The event, headlined by an exploding barbed wire deathmatch between Jon Moxley and AEW champion Kenny Omega and closed by a disappointing “time bomb” explosion, generated just over $5 million. The vast majority of that revenue was from pay-per-view sales of the broadcast, but ticket and merchandise sales also contributed.
After splitting revenues with various pay-per-view distributors, AEW will net more than $2 million in revenue.
The event, which probably required under $1 million to produce, was likely quite profitable.
Wrestlenomics estimate of revenues related to AEW Revolution 2021 (3/7/2021)
Retail price for the PPV was $50 in the U.S. and most of Canada, where sales for this event likely doubled compared to other recent shows. As always, the price was lower in international markets, which mostly sell the PPV at $20 USD. Proceeds from PPV sales are split with distributors, who keep the narrow majority of the revenue. The standard split domestically is 45% to the content provider. Splits in international markets are slightly less favorable, generally.
AEW admitted about 1,150 paid attendees at Daily’s Place in Jacksonville, Florida, according to the Wrestling Observer Newsletter. An estimated average ticket price of $65 was used in this estimate based on the advertised ticket price range of $40 to $90.
Merchandise sales per paid attendee performed better than the usual $15, I was told. A rate of $18 in merchandise per paid ticket was used in the table above to come to a venue merchandise estimate of nearly $22,000.
The header image for this article is courtesy of All Elite Wrestling.
Brandon Thurston has written about wrestling business since 2015. He’s also worked as an independent wrestler and trainer.
This article is available ad-free for everyone because of support from our subscribers.
WWE Smackdown, WWE Raw, AEW Dynamite, WWE NXT, and Impact Wrestling television viewership update for seven days beginning March 4 and ending March 11, 2021
The Basics
WWE Smackdown last week Friday on Fox was watched by 2,252,000 viewers, the most since February 5. It had a P18-49 with a rating of 0.60 (771,000 viewers).
WWE Raw on Monday on USA Network was watched by 1,897,000 viewers, the most since January 4. It ranked #1 on the day on cable in P18-49 with a rating of 0.55 (718,000 viewers).
AEW Dynamite last night on TNT was watched by 743,000 viewers, the fewest since February 10. It ranked #4 on the day on cable in P18-49 with a rating of 0.32 (414,000 viewers).
WWE NXT last night on USA Network was watched by 691,000 viewers, the fewest since February 10. It ranked #25 on the day on cable in P18-49 with a rating of 0.18 (233,000 viewers).
Impact Wrestling on Tuesday on AXS was watched by 144,000 viewers. It ranked #117 on the day on cable in P18-49 with a rating of 0.04 (50,000 viewers).
Remarkables: viewership demographics that were +/-10% compared to the median of the last four weeks
WWE Smackdown’s reported demos were all within 10%.
WWE Raw’s reported demos were all within 10%.
For AEW Dynamite, young adults (aged 18 to 34) were down 18%, adults over age 50 were down 11%.
For WWE NXT, young adults (aged 18 to 34) were up 33%, women aged 18 to 49 were down 14%.
For Impact Wrestling, total viewership was down 11%.
But all TV ratings are down! How are wrestling programs trending compared to television viewership generally?
In total viewership (P2+) the top 50 non-news cable programs are down 21% compared to the same 13 weeks a year ago.
By the same measure, AEW Dynamite is down 12%. Impact Wrestling is down 16%. WWE NXT is down 4%. WWE Raw is down 19%. WWE Smackdown is down 8%.
In P18-49 viewership, the top 50 non-news cable programs are down 29% compared to the same 13 weeks a year ago.
By the same measure, AEW Dynamite is down 7%. Impact Wrestling is down 5%. WWE NXT is down 27%. WWE Raw is down 25%. WWE Smackdown is down 17%.
Brandon Thurston has written about wrestling business since 2015. He’s also worked as an independent wrestler and trainer.
This article is available ad-free for everyone because of support from our subscribers.
For anyone in the U.S., Peacock Premium becomes the exclusive home for WWE Network content, beginning April 4. It will be the end of an era of business for Vince McMahon’s company, which seven years ago boldly launched its own streaming service.
So let’s reflect. Did it work out? Is WWE more or less profitable today because of the Network? Is the sale of the domestic rights a sign of failure? Could it have turned out differently? I’ll try to answer those questions here.
There are a few signs the WWE Network was a disappointment, including:
The WWE Network, as implemented, has not produced an obvious positive return on the investment, in my estimation. I will explain further in this article.
Former co-presidents, George Barrios and Michelle Wilson, the architects of the Network strategy were abruptly terminated in January 2020, at the same time WWE made clear it was interested in selling the rights to the Network content and discarding the direct-to-consumer model.
What we need to know about WWE Network profitability
Figuring out whether WWE is more or less profitable today because of the Network is ultimately hypothetical. To do so, we have to conceive of at least one alternate scenario and compare it to WWE’s actual financial performance during the years in which the Network existed.
It’s important to understand a few points when thinking about the WWE Network, which makes concluding the company made a positive return on this investment more difficult:
The WWE Network cannibalized the pay-per-view business, as many people are aware.
It also cannibalized DVD/Bluray, digital VOD sales, and internet pay-per-view sales.
An issue often overlooked: The timing of the WWE Network launch negatively affected WWE’s TV rights negotiations that were ongoing in early 2014. Vince McMahon confirmed this publicly.
The WWE Network required around $66 million in start-up expenses. These expenses were incurred beginning as early as 2011, according to company public filings, which raises the financial benchmark for a positive return on investment.
But there were benefits too. The Network allowed the company to sell more ad inventory and increased the number of viewers who saw sponsors on monthly peak events.
A vast amount of data was collected since millions of user accounts were created, which allowed for targeted marketing. However WWE’s attempts at selling wrestling fans’ data to third parties was disappointing, I’ve been told.
And you could write a whole other article on the potential opportunity WWE may have had in growing a video streaming business (much like its shuttered WWE 24/7 and Classics On-Demand business) that attempted to monetize the company’s video library but didn’t include live broadcasts of monthly PPV events.
Later on in this article I’ll show the results of my estimates about what WWE’s profitability could’ve been, in an alternate timeline, if the WWE Network was never launched, compared to my estimates of the company’s profitability in our actual timeline. Profitability is here measured as OIBDA (operating income before depreciation and amortization).
This estimate is somewhat further complicated by the fact WWE changed its financial reporting method after 2017, requiring me to do estimates on the actual timeline as well as the hypothetical “alternate” timelines.
To come up with a likely scenario where the WWE Network is a financial winner, I have to imagine a “bear case” alternate timeline in which pay-per-view demand from 2014 to 2020 severely declines.
Alright, let’s try to do the math
Following these graphs are the key assumptions behind them.
For the “actual” timeline, we have actual OIBDA details in the segments shown in the above column graph reported by WWE for the years 2011 to 2017. Because WWE changed its reporting method thereafter, estimates had to be made for the years 2018 to 2020. The key assumptions for those later years were:
WWE Network OIBDA margin of ~33%
Digital Media OIBDA margin of ~30%
Digital Media revenue equivalent to ~67% of media ads & sponsors revenue.
Home Entertainment OIBDA margin of ~13%. Revenues less than $2 million, beginning 2019.
For “Base case” alternate timeline, the key assumptions were:
Traditional PPV generates ~$44 million in incremental annual OIBDA, 2013 to 2020
Internet PPV generates ~$4 million in incremental annual OIBDA, 2014 to 2020.
Home Entertainment OIBDA at a rate of ~1.5x of actual timeline, beginning 2015.
For “Bear case” alternate timeline, the key assumptions were:
PPV and internet PPV sales and profitability decline over time, consistent with worldwide Google search trends, resulting in $63 million less (-14%) lower OIBDA from pay-per-view.
Same Home Entertainment assumption as “Base case”.
Below are revenue and OIBDA estimates tables for the three relevant scenarios: “actual”, “base alternate”, and “bear alternate”.
You’ll notice I didn’t deal with the benefits of ad revenue or the value of user data, mentioned earlier, in these models. WWE’s filings don’t give us much clue on how to calculate those values. I tend to believe those factors’ accretive OIBDA is relatively low on the scale of the calculations made here, but maybe it makes the difference of a few million in OIBDA.
If we accept the “bear case” conclusion that the WWE Network added about $42 million in OIBDA for the company, that would mean the WWE Network meant, at best, a 5% increase in OIBDA over the entire Network era. WWE generated about $915 million in total company OIBDA in the years from 2011 to 2020.
In this generous “bear case”, the Network provides a small incremental increase in profitability, but not the kind of “transformational” change that was hyped at the product’s launch.
So why didn’t things turn out better?
The $9.99 price point was too low, possibly because WWE executives misunderstood the product’s place in media In pricing the Network, WWE placed itself nearer to scripted entertainment pricing than sports. In hindsight, $15 or $20 monthly would’ve been more appropriate.
At the time of the Network’s launch as well as today, sports leagues charge their fans higher prices for access to out-of-market games. That’s especially evident if you average the annual cost only over the months in which the league operates its regular season, as shown in the “Standard price point” chart above.
Per month of its regular season, MLB charged $18 in 2014. The NFL went as high as $60, and higher today. Yet in its domestic market WWE in 2014 and until it transfers rights to NBCU in 2021, charged subscribers just $10 monthly — more along the lines of the monthly fee for services like Netflix or Hulu.
So why did WWE price its service at $10, more like a scripted entertainment service and less like a sports streaming service?
Since Vince McMahon took control of the company in the 1980s, he’s worked hard to move his wrestling product toward being seen as “show business”, entertainment rather than sport. I think one of the core impediments for WWE growing its consumer revenues is McMahon’s unwillingness to embrace his product for the simulated sport that it is. Usually, that flaw only manifests in onscreen creative. McMahon is normally an effective corporate leader, eager to bet on new media like cable TV, pay-per-view, social media, or streaming. But in this case, his philosophy of imagining WWE “not as sport but as family-oriented sports entertainment” may have been a detriment to corporate strategy, too.
Pay-per-views were sold at a variety of price points for many years and it didn’t seem to have a strong effect on sales. The PPV price of the biggest show of the year, Wrestlemania, nearly doubled in price from 2005 to 2013, gradually increasing from $35 to $60. It’s not clear price increases affected demand.
It’s much more likely, in my view, whatever affected the change in Wrestlemania PPV sales from year-to-year had much more to do with the hype around the matches on the event. It was a good business decision to raise the PPV price on Wrestlemania (and on PPVs generally).
To illustrate a point, if the worldwide monthly WWE Network price was about $20, paid subscribers could have been half of the actual achieved number (about 1.5 million) and generated similar revenue.
1.3 million subscribers at $15 monthly would generate $234 million annual revenue, almost 30% more than the actual performance of the Network in 2020, and edging out the average annual value of the new Peacock deal ($200 million). This hypothetical $234 million, though, is far short of WWE’s original goal of 3 million worldwide subscribers at $10, generating about $360 million in revenue.
In retrospect, as we explored earlier, it’s likely value was lost by essentially underpricing $60 PPVs at $10 for seven years. That lost value can hardly be regained. The Peacock deal (worth an average of about $200 million per year) salvaged the value remaining in PPV events by guaranteeing incremental revenue over a direct-to-consumer subscriber business (generating around $132 million domestically per year) that fell stagnant. Trying to put the genie back in the bottle and revert to a la carte sales of monthly events at a high price point would likely be met with resistance. I think it would present a massive friction point for a significant number of regular customers. WWE and NBCUniversal apparently recognize the old model can’t be reverted to at this point, given the decision to keep monthly PPVs as part of a low monthly fee.
Disenfranchised wrestling fans who would like to see WWE face economic consequences for perceived bad creative, is a sentence this media economy, with its need for live sports, never serves. Better developed stars and creative would’ve helped Network subscriptions, for sure, but the Network disappointed more due to strategy than creative.
The fault of the WWE Network was that executives didn’t recognize that wrestling is maybe the only medium on Earth that so overlaps sports and scripted entertainment. And if you understand that peculiarity, you’ll better understand wrestling price points, DVR viewing, linear viewership, broadcast rights, and probably more.
Final answers
Is WWE more profitable today because of the Network?
It’s a hypothetical question, but the answer isn’t an obvious ‘yes’. The Network as a business was more profitable than the previous pay-per-view business in isolated years, but the Network’s startup costs and cannibalization of other businesses offset much of the financial benefits for the duration of of the service’s run as a mainly direct-to-consumer product.
Is the sale of domestic rights a sign that the Network failed?
It’s a sign that it didn’t work out the way it was expected to. Executives had lofty subscriber goals that the Network fell well short of. By 2020, subscribers didn’t look like they were poised to grow much further. Raising the monthly fee would be risky. Selling rights to the content to a larger media company looking to invest in streaming at a higher scale is likely the better way to grow revenues related to the content.
Could it have turned out differently?
Certainly. In hindsight, I think the Network was obviously underpriced. I think a lower but not-that-much-lower number of subscribers could’ve been captured at $15 or even $20 monthly. Or access to the full library could’ve been part of a higher-priced premium tier. Or the most popular pay-per-views could’ve been left off the service and continued to be sold for $60 while still monetizing the library and other new content via streaming, which might’ve generated greater profitability.
Brandon Thurston has written about wrestling business since 2015. He’s also worked as an independent wrestler and trainer.
This article is available ad-free for everyone because of support from our subscribers.
Next week I’ll post a longer blog looking back on the WWE Network’s effect on the company’s finances. Here is a tangent that didn’t fit in that article, about an often overlooked way in which the Network launch impacted WWE’s business.
NBCUniversal (which owns television networks) and its parent company Comcast (which owns cable TV systems) were apparently uneasy about WWE’s entry into the streaming business with the launch of the WWE Network on February 24, 2014.
Also in 2014, WWE and NBCU were negotiating terms of a new deal for Raw and Smackdown. The then-current agreement was set to expire in September 2015. Other sports properties like Major League Soccer were attracting big upgrades in rights fees. WWE had just gotten a strong increase in fees from its United Kingdom partner, Sky. Optimism about what WWE might garner for rights in the U.S. swelled.
CEO Vince McMahon famously told an analyst, in August 2013, “I’ll allow you to put a hammerlock on me if we don’t” at least double U.S. rights fees from WWE’s current deal, which was worth somewhere in the ballpark of $77 million on an average annual basis. Doubling or even tripling that value, as some speculated was possible, would result in a new multi-year deal worth $150 million or even $230 million per year.
Enjoy the audio of the memorable “hammerlock” exchange below:
NBCUniversal’s exclusive negotiating window deadline of February 15, 2014 passed without a new deal for Raw and Smackdown, leaving WWE to negotiate with other potential media partners.
Hopes of a big raise in rights fees caused WWE’s stock price to surge to as much as $30 per share in March 2014, three times higher than the $9 shares were valued at the year prior.
On May 15, 2014, news broke that WWE and NBCUniversal made a deal after all. Analysts estimated the new agreement was worth just 1.7x over the value of the current deal. Some estimated as low as 1.5x. In any case, it was well short of the market’s expectations. Wall Street was already not blown away by early subscriber counts for the Network. The announcement of a disappointing TV deal caused the remaining bubble on WWE shares to burst. The stock price fell back to its value before the run up.
WWE’s stock price during the relevant time period
What exactly were NBCU’s (or any alternative U.S. media partner’s) reasons for not rewarding WWE with a bigger contract, we can only guess. But it seems plausible a TV distributor for Raw and Smackdown would be unsure how the WWE Network, which would contain episodes of those programs on a 30-day delay, would effect the linear viewership of WWE’s flagship programs. Plus, the Network served to undercut pay-per-view sales from carriers, including cable systems like those owned by NBCU’s parent, Comcast.
By the CEO’s own admission, the timing of the WWE Network launch “definitely had a negative impact” on negotiating a deal favorable to WWE.
Daniel Moore (CJS Securities analyst): You’ve maintained, obviously, that the launch of the network would not cannibalize viewership, and would not impact negatively your negotiating position for the TV rights in North America with NBCU. With hindsight, was the launch of the network a sticking point for your current and potential cable partners, and would you have considered delaying it, if you had to do it over again?
Vince McMahon: That’s a very fair question. I’ll answer that one. I think it definitely had a negative impact. How much of it, I don’t know, by coming out with the Network before we finished negotiating all of our rights. The other aspect of that is that if we didn’t come out with the Network when we did, it would take us another year, because the idea there was to come out with the Network at the strongest point, which would be Wrestlemania, so it’s a chicken-and-egg kind of situation. I do think, though, that was part of, I don’t know if it was a significant aspect, but part of a lighter number, in terms of television rights. So I think that’s a fair thing to say.
Despite the disappointing deal in 2014 (going into effect in October 2015), with just a 1.7x increase, WWE did manage to get a huge increase in fees four years later in the following round of negotiations. By splitting rights to Raw off to NBCUniversal and selling Smackdown to Fox, the company got a 3.6x raise, worth in total about $470 million per year, going into effect in October 2019 through September 2024.
This makes the issue of the Network’s impact on WWE’s finances even more fuzzy, to me at least. Did the 2018 3.6x increase make up for the disappointing deal in 2014? Or would WWE have been able to get a similar deal regardless. In other words, did WWE miss out on two consecutive 3x increases? Or would the 2018 increase have been lower if the 2014 was larger? I have no idea.
If WWE did indeed miss out on two huge increases in rights fees for Raw and Smackdown, that would leave little doubt that the Network strategy, as implemented, was not financially beneficial — largely due to timing.
Brandon Thurston has written about wrestling business since 2015. He’s also worked as an independent wrestler and trainer.
This article is available ad-free for everyone because of support from our subscribers.
You must be logged in to post a comment.