This post is part of a series of snapshots taken from the analyses of what is likely the only ever census of MMA fights (enuMMA17). Please see the table of contents for an up to date list of available instalments.
Growth in Fights Revisited
In our previous instalment we introduced you to the dataset & had a peek at the number of fights per year. The plot showed a marked drop off in the number of fights per year since the peak in 2013. Redrawing the plot as a cumulative total of fights yields...
fig 01: Cumulative Fights per Year (1993 - 2017)
The cumulative curve shows the typical 'S' shape expected in growth curves. The annotations show how astute the Fertitta brothers where in timing both the purchase & sale of the UFC. This is even more evident in the next plot.
Comparing Growth in Fights, Events & Promotions
In order to compare the growth in fights, events & promotions it was necessary to rebase them to 100 in the 1st year (1993). Rebasing allows for the direct comparison of variables with very different magnitudes by comparing their growths rather than values.
fig 02: Fights, Events & Promotions (Rebased to 100 in 1993)
Apart from highlighting the timing of the purchase & sale of the UFC, this plot tells a compelling story about the MMA market. It is a story that seasoned investors & analysts know well. The founders & early adopters struggle while fighting for recognition & in this case major legal battles. Those who come next ride the back of the market that has just gained critical mass a la the Zuffa purchase. As the market gains momentum, usually as it reaches it's peak (2005 - 2010) we see more & more investment. In the MMA market that meant more promotions. These new promotions flooding the market, at least to some degree, dilute it as can be seen in the events closing the gap with fights over this period i.e. we had more events but fewer fights per event. This is a saturation point. At this point in the cycle consolidation becomes the order of the day & the number of promotions collapsed. Given time there should be stabilisation as the market find it's natural balance after over shooting.
Next time we'll be taking a more detailed look at the promotions