Monday, February 7, 2011

Chuck Norris's 'Blue Ocean' of Combat Sports

I finally had a chance to read up on "Blue Ocean Strategy" as a part of my Marketing class on Value Creation and thought enough of it to try to make some connections to the Mixed Martial Arts industry. If you're unfamiliar with the 'blue ocean' concept, the basic idea is that companies have a tendency to play within existing industries and fight to outperform one another within the context of the generally accepted rules and business practices. This traditional space is referred to as 'red ocean' because the fighting becomes so intense that the waters turn red with blood. A 'blue ocean' strategy, on the other hand, is one that creates new market space by expanding or even ignoring industry boundaries, making the competition irrelevant.

One of the more interesting examples of this 'blue ocean' strategy is Cirque du Soleil. The success of Cirque is detailed in this excerpt from the "Blue Ocean Strategy" text:
A one time accordion player, stilt-walker and fire-eater, Guy Laliberte is now CEO of one of Canada's largest cultural exports, Cirque du Soleil. Created in 1984 by a group of street performers, Cirque's productions have been seen by almost 40 million people in 90 cities around the world. In less than 20 years Cirque du Soleil has achieved a revenue level that took Ringling Brothers and Barnum & Bailey's Circus - the global champion of the circus industry - more than one hundred years to attain. What makes this all the more remarkable is that this rapid growth was not achieved in an attractive industry. It was in a declining industry in which traditional strategic analysis pointed to limited potential for growth. Supplier power on the part of star performers was strong. So was buyer power. Alternative forms of entertainment - ranging from various kinds of urban live entertainment to sporting events to home entertainment - cast an increasingly long shadow. Children cried out for Play Stations, rather than a visit to the traveling circus. Partially as a result, the industry was suffering from steadily decreasing audiences and, in turn, revenue and profits. There was also increasing sentiment against the use of animals in circuses by animal rights groups. Ringling Brothers and Barnum & Bailey's Circus set the standard and competing smaller circuses essentially followed with scaled down versions. From the perspective of competition-based strategy, then, the circus industry appeared unattractive.
If Cirque du Soleil can successfully reinvent the circus it got me wondering what the equivalent might look like within the sport of Mixed Martial Arts. This topic is particularly interesting given that, in many ways, the UFC itself began as a 'blue ocean' idea. Originally conceived in 1993 as a "War of the Worlds," the idea was pitched to Semaphore Entertainment Group (SEG) who was looking to create new categories for a pay per view market dominated by wrestling, porn, and Mike Tyson. Jonathan Snowden details the history of the birth of the UFC from the perspective of Adman Art Davie in his comprehensive book on the history of MMA "Total MMA: Inside Ultimate Fighting."
Davie said, "Milius, Gracie and I were sitting around talking one night, and we began to have a conversation, like guys used to have in Vietnam, about if Sugar Ray Robinson were alive and fought Bruce Lee who would win. People always have those 'what if?' conversations in the martial arts. Out of it came a desire to do this event. I went back to my agency and had my art department put together a comp called 'War of the Worlds.'"
In many ways, Davie and SEG were doing for combat sports what Cirque du Soleil did for the Circus. The idea of fighting as a spectator sport was certainly nothing new, but the tournament format in which competitors would be required to fight multiple times in a single night to win, the octagon shaped cage as a replacement for the traditional boxing ring, and the representatives of different fighting styles competing under a loosely defined set of unified rules were all 'blue ocean' concepts. Combat Sports would never be the same.

After the jump I will take a closer look at Chuck Norris and his 'blue ocean' ideas.

Of course, while the UFC remains the big fish in the ocean it created, the entrance of  competitors like Strikeforce have bloodied the waters considerably since its 'blue ocean' beginnings. My first thought in attempting to brainstorm an example of a modern day 'blue ocean' within the industry of Mixed Martial Arts was Bjorn Rebney's Bellator Fighting Championships. They were certainly creative in their viral youtube beginnings as an organization and their 'season' approach and weekly Thursday time slot make them somewhat unique, but their tournament format is clearly nothing new and the more time passes by the more I see them bloodying their waters in competition with the UFC; especially considering the recent legal battles between the two organizations.

To truly find a 'blue ocean' in the world of Marital Arts Competition I was forced to look a little deeper beyond the traditional MMA boundaries, but certainly no further than Chuck Norris's World Combat League (WCL). Yes, the very same Chuck Norris who's tears cure's too bad he never cries. The same Chuck Norris who doesn't need Twitter because he's already following you. Yes, the same Chuck Norris who counted to infinity - twice! The very same Chuck Norris...sorry, I could go on forever so just go to this link if you want to learn more about the awesomeness of Chuck Norris. 
If you are unfamiliar with the WCL, here's a quick run-down from their website:
WCL events feature CMA (Combat Martial Arts) extreme action. It's all about STRIKING: Kicking, Punching and Kneeing (think of it as "KARATE FOR THE NEW MILLENIA"). There is no holding, clinching, throwing, grappling or wrestling. If a fighter lacks spirit, or tries to slow the pace of the fight down by holding or avoiding, his team will immediately be penalized.
Three judges score each fight based on knockdowns, extent of damage inflicted, and the volume of clean-scoring strikes landed. Each judge will award five points to the fighter they see as superior, and four or less points to the opponent. The judges points are combined at the end of each fight (15 points maximum, not counting penalties), and are then added to the teams overall total from the previous fights. The team with the most points at the end of the second half wins.
Okay, so the WCL is not MMA in the strictest sense of the sport. But it certainly represents a mixing of different martial art styles and it falls within the more broadly defined industry of Combat Sports. In fact, the WCL website features a section on "Techniques Used" that details elements of Boxing, Kickboxing, Muay Thai, Karate, Kung Fu, and Tai Kwon Do. Sure sounds a lot like a Mixed Martial Arts to me, just a different approach to the same basic concept. 

In 2006, Chuck Norris saw an opportunity to capitalize on the soaring popularity of Mixed Martial Arts. But he also understood that many American fans were not as familiar with the ground fighting aspects of the sport and craved fast-paced action. He further saw opportunities to involve both men and women and to  follow the more traditional sports model of team-based competition with strong ties to a particular city or region. Clearly, the WCL appeals to a different type of combat sports fan. The question is, are there enough of these fans out there to achieve profitability?
Below you can see the breakdown between the 'blue ocean' created by Chuck Norris and the 'red ocean' currently being fought over by larger promotions like the UFC and Strikeforce:

While the WCL has struggled to find financial success since establishing this 'blue ocean' within the broadly defined combat sports industry, it remains an interesting and novel approach to an otherwise fiercely competitive space. Now approaching their third season, the WCL hopes to achieve financial stability and sustained growth with plans for international expansion into Canada and the UK. Will Chuck Norris succeed? Only time will tell, but at least Chuck can rest easy knowing that he can win a game of Connect Four in only Three moves! 


  1. You've demonstrated a simple misunderstanding of the fundamental element of a Blue Ocean strategy. Simply put, a Blue Ocean opportunity should convert non-buyers into buyers. With all due respect to you, Chuck Norris, and his WCL, his concept was novel, but it was targeting the same demographic as any MMA, martial arts, or kickboxing promotion on the planet. There's nothing Blue Ocean about it. It was a mildly differentiated product in what was already a very Red Ocean. It was the UFC without the "U."

    When the UFC was started it could have been considered a Blue Ocean concept in that it was a new product in an existing combat sports industry (boxing and wrestling), but was so heavily differentiated that it converted non-buyers (traditional martial arts fans) into buyers of combat sports entertainment products. Previously, a strong segment of traditional martial arts fans were not buyers of boxing or wrestling entertainment products.

  2. There are striking similarities between what WCL has launched and when Southwest lauched into the airline space. The difference is Southwest took a truer Blue Ocean Strategy by targeting non-buyers (family/shorter trips v. business trips) and they focused on alternatives means of travel (cars v. planes) instead of other Airlines.

    WCL however focused on a niche(s) within the MMA industry those being fast-paced striking and inclusive of men & woman. WCL does not pull non-buyers into the MMA industry nor cross industry boundaries to be seen as an alternative. They may draw more attention to the MMA industry but primarily from the involvement of its figure head (Chuck Norris).

    I believe it more prudent to characterize WCL in terms of Porters Five Forces rather than a in terms of Blue Ocean. WCL in the world of Porters Five Forces is taking Focus Strategy that focuses on a smaller segment of a broader market with focus on creating a unique differentiation or unique cost proposition.

    You may also consider looking at WCL through the prism of Gartners Magic Quadrants juxtapose to Blue Ocean Strategy and/or Porters Five Forces.

    I agree that the UFC, Bellator, and WCL are beginning to show signs of a creating a Red Ocean in the MMA industry. The problem with this thinking is that the MMA is one of if not the fastest growing sports in the US. Red Oceans are characterized by industries where margins are tight with very little to no differentiation and a shrinking or constant consumer base. None of which characterize the MMA industry seen by the UFC/FOX deal and the (13%+) growth in audience for the likes of UFC over the past few years, whereas other major sports such as NBA, MLB, NFL all have seen a slight decline in fan bases. Source Simmons Research.

    Notable to point out is that in the major US sports industries there normally exists one or two dominant players. Examples the NFL before the AFL and NFL merged or the MLB and NBA. I would suspect that there will be numerous acquisitions or mergers in this space i.e UFC acquiring Strike force earlier in 2011 leading to consolidation into only one major MMA organization.

  3. I thought Chuck Norris is not a real person.

    Marielle of wholesale mma