wrestling / Columns
The Hamilton Ave Journal 06.10.10: Volume 2 – Issue 141
THE HAMILTON AVE JOURNAL
By JP Prag
Volume 2 – Issue 141
ABOUT THE JOURNAL
The Hamilton Ave Journal is the only wrestling news report focused solely on the business of wrestling. Here in the Journal we not only look at the stories that are important to the investor and business-minded person, but also delve deeper into stories that most fans of wrestling would overlook. That is because the Journal is about getting the heart of the matters that affect the companies and outlooks of the wrestling world.
And where is Hamilton Ave? That is the location of the WWE Production Studio in Stamford, CT, and thus the most powerful place in the wrestling world. Besides, The East Main Street Journal just does not have the right ring to it.
Who am I? I am JP Prag: consultant, entrepreneur, businessman, journalist, and wrestling fan.
Now, ring the bell because the market is open.
The Journal’s front page area known as What’s News isn’t just about telling you what has happened. The stories in this section are about what will have an effect on the wrestling industry, individual federations, and the wallets of the fans.
LEAD STORY: Toys, toys, toys
During the WWE’s Q1 report, it was revealed that the new toy line from Mattel has been selling so well that the toy company is having trouble keeping up with demand. As the months have gone on, that situation has not been alleviated. From Mary Ellen Lloyd of the Dow Jones News Wire:
Mattel continues to scramble to keep up with demand for its action figures and other toys under the World Wrestling Entertainment (WWE) license, Friedman said.
The WWE line has been strong with collectors all along, but new Flexforce action figures and role-play toys like the WWE Championship Belt and wrestling- match rings are also doing “exceptionally well” with children and have broadened the line’s appeal, he said.
“Although we had high expectations, we continue to chase some of the kids’ assortments, like Flexforce, to try to get some of the stock at retail,” he said.
The WWE’s portfolio has been shifting in the mix of consumer products. While video games and DVD sales have been relatively soft, toys continue to be one of their largest areas for growth.
Meanwhile, the WWE left Jakks Pacific behind when they went to Mattel. TNA was quick to pick up on the contract and has started to launch their own toy line as well. This Sunday afternoon, TNA will be hosting an event prior to their PPV to show to promote their new line of action figures. While no sales numbers have been delivered yet, TNA has found a lot of success in branched out products. The trading card collections have been a significant area for growth within the company and TNA is hoping to capture the same here.
On a similar end, toys can branch out to young consumers and collectors in ways that their own television programs cannot. While TNA had hoped this would work with their video game to limited results, they have not given up hope. Of course, TNA launched a new game for the Nintendo DS in a few short weeks.
Newsbites
Some items of note in the rest of the wrestling business world:
[P]roviding strategic direction around WWE’s branding and promotions, television tune-in, pay-per-view events, network affiliate marketing, WWE Studios and market research.
Mr. Hill comes to the WWE via American Express where he was Vice President and Head of US Advertising. Prior to that, Mr. Hill has worked at Nickelodeon, ESPN, and Disney.
A little bit of info here for Brit wrestling fans which may slipped by them.
Bravo (which airs TNA iMPCAT) was sold today by Virgin Media to Sky TV (which shows WWE).
I wonder if WWE has a contract with Sky saying something like “WWE is the only wrestling product you can show”. If that is the case it could mean that iMPACT may no longer have home on British television.
Sky may have a contract like that, but they most likely have a clause that says if they acquire a new network they must honor their contracts. Much like Spike in America, Bravo cannot just cancel a contract with TNA. They have an obligation to pay TNA and air their programming.
Additionally, the acquisition has not happened yet. This still has to pass regulatory hurdles which puts the deals a bit off. And as V noted in the comments section, the WWE does not have a lot of weight on Sky compared to other premium programming. Football brings in the vast amount of revenue for Sky, so Sky would more than likely let the channels run themselves for the time being. When the contracts are up, TNA might have an issue, but for now Sky really does not have a station like Bravo in their portfolio so they will more than likely keep them around for the time being.
In the Marketplace we look at the trends in television ratings. This section is less for critical analysis by the Journal but more for the reader to see what is really going on and to draw their own conclusions.
As with stocks, here in the Journal we track the progress of television ratings. If ratings are the barometer by which we judge the product, then over the course of time we should be able to see patterns, trends, and anomalies.
For the week ending Wednesday June 2, 2010, here are the current standings of the shows:
Analysis:
With a three hour RAW once again, the WWE continued the trend of declining ratings for specials. The show came in at 3.1, with the normal hours doing a 3.3. Either way, the show has a 3.22 four week rolling average, of which is completely bolstered by the 3.44 for the commercial free RAW. If ratings come in similar next week, the show will be looking at a 3.1 four week average. Despite much of its main competition ending, RAW has still not been able to rebound.
iMPACT, too, gave back recent gains after three weeks of recovery. The show dropped back down to a 0.87. Meanwhile, the Thursday effect of having iMPACT back once again helped SuperStars which did go up to a 0.76.
Also of interesting note, the original airing of Half Pint Brawlers did a 0.7 rating. While come in the commentary section would have you believe that this is higher than iMPACT, as can be seen three sentences above that is not true. However, this is quite impressive for (a) a show on Spike and (b) one with such a limited audience potential. If the ratings keep up for the six episode pilot season, expect Spike to pick up more shows.
We all know that wrestling is a business, but we don’t often pay attention to what sells and makes money. Money and Investing looks into the top selling items in the world of wrestling and any interesting figures that may have come out this week.
What are the top selling items for the WWE? WWEShopZone.com releases a list of varying numbers to show what is selling for them:
1. John Cena Never Give Up T-Shirt ($25.00)
2. The Undertaker’s Deadliest Matches DVD Package ($59.95, on sale $29.99)
3. John Cena Never Give Up Baseball Cap ($20.00)
4. John Cena Never Give Up Sweatband Set ($12.00)
5. John Cena Never Give Up YOUTH T-Shirt ($22.00)
6. The Best Pay Per View Matches of the Year 2009-2010 DVD ($34.95, on sale $21.49)
7. Randy Orton Lobotomy T-Shirt ($25.00)
8. WrestleMania XXVI Collectors Cup ($5, on sale $2.99)
9. The Undertaker’s Deadliest Matches DVD ($34.95, on sale $21.50)
10. WWE Slam Attax Trading Cards ($3.00)
11. Hart Dynasty Thicker Than Water T-Shirt ($25.00)
12. Rey Mysterio Big Face Basics YOUTH T-Shirt ($9.99, on sale $6.98)
13. Rey Mysterio 619 Bracelet ($8.00)
14. John Cena Never Give Up Pendant ($10.00)
15. John Cena Attitude Adjustment Pendant ($10, on sale $6.98)
16. Matt Hardy Unlock Your Destiny Pendant ($10.00)
17. Miz I’m Awesome T-Shirt ($25.00)
18. John Cena Never Give up YOUTH Basics T-Shirt ($9.99)
19. John Cena Never Give up Beach Towel ($19.99)
20. Big Show Go Big T-Shirt ($25.00)
What more can be said about the dominating selling power of John Cena? Not much, so the Journal will talk about some other items. The Undertaker continues to sell well, having his longest streak on this list despite being out the action. The man who took him out in Rey Mysterio is also doing quite well, bringing in two items of his own, though low priced. Matt Hardy not only managed to hold on to his spot, but actually increased four spaces–a quite unexpected twist. Rounding out the list, though, was the biggest surprise of all in the Big Show. The Big Show has never been much a merchandise seller, not in the WWE nor in his WCW days. To see him breach this list is quite an accomplishment for the world’s largest athlete… or a sign that sales of everything else are falling.
TNA sometimes releases a list of top selling items on ShopTNA.com. According to the site the top selling items were:
1. Don West’s Vintage Celebration ($59.97, on sale $6.99)
3. Sacrifice – 2005 ($19.99, on sale $14.99)
4. Jeff Hardy Enigma T-Shirt (Glow In The Dark) ($19.99)
5. Bound For Glory 2005 ($11.99, on sale $4.99)
6. RVD – Video Wall T-shirt ($19.99)
8. Mr. Anderson………People Are Fake T-Shirt ($19.99)
9. Cross The Line Triple Pack 3.0 (Triple Threat) ($24.99, on sale $19.99)
10. Slammin’ Celebration ($199)
TNA will not update, therefore nor shall the Journal.
Wrestling isn’t just about watching and reading. The best way to be a wrestling fan is to experience it live. Where is wrestling coming to in the upcoming weeks? The Personal Journal answers that question.
Do you know a wrestling event coming up? Send one in to The Hamilton Ave Journal and we’ll be sure to add it to the list.
The Editorials section is designed for you, the readers, to respond to the views presented in the Journal, send an important news item, or talk about another overlooked business related item in wrestling. Just beware: the Journal reserves the right to respond back.
From the commentary section last week, the trademark talks inspired people like Guest#5774 to do some searching of their own:
That point about trademarking names was interesting.
A little search of the US Patents & Trademark Office shows that “AJ Styles”, “Velvet Sky”, “Angelina Love”, & “The Beautiful People” are not trademarked.
Now AJ Styles did use that name before working in TNA, IIRC, so they may not have the greatest case there.
Now if WWE really wanted to screw with TNA, they could hire those three and use their TNA names. Not that WWE has shown a history of using previous names, but recently they have. They do have a history of going out of their way to be un-necessarily vengeful too.
I’d take Jeff Hardy too, but that name was already established.
The fact that TNA has not trademarked anything related to The Beautiful People is interesting. Whatever may be said of their wrestling skills, TNA has pushed this group hard. A check of TNA show reviews & match listings shows that it is a very rare week when this group has not made it on air. The reason is pretty simple – they have the ratings to justify it.
TNA has also failed to trademark a number of other wrestler & stable names they have established.
Which is a long way to say that TNA needs to learn how to protect their intellectual property.
TNA has let that slip, but let’s be clear about a few things. First off, Jeff Hardy cannot be trademarked because it is really his name. AJ Styles, like others, can demonstrate he used his name before TNA and therefore they have no control over it. Heck, the WWE has a bigger claim than TNA since AJ Styles was in WCW shortly before they purchased the company.
Of course, much of TNA’s business model always has to come under question. And to ask those questions here’s Ronnie:
I’ve got a 3 question for you.
WWE has run with a basic formula for many years, with certain exceptions: They use TV to advance angles with the purpose of convincing the audience to buy PPV to see a wrestling culmination. PPV is where the boys get 10-20-30 minutes to put on a match with few skits.
Now TNA’s business model differs from WWE in that they are not PPV-dependent. My questions are thus:
Since TNA does not see PPV buyrates as their measuring stick for success, why do they ape the WWE operating model which does?
Looking at their booking, one could say that TNA does not ape the WWE in the respect that TV does not build to PPV, but often works the other way around. The real question is why do they have PPV when it does not help them that much? The answer is that they are locked into contracts and cannot drop it immediately. TNA President Dixie Carter has blatantly stated in words quoted in the Journal that she would like to reduce the PPV model at the very least, but she cannot break her contracts right now. Given time, TNA will get out of the TV to PPV system.
That said, why did TNA get into it? Because at the time TNA thought they needed PPV because the industry had been conditioned to believe that PPV was how things culminated. As time went on, though, they saw that it was really not the best thing for their business. Unfortunately, they realized too late instead of doing more proactive analysis. That, though, is one of TNA’s major business flaws that they often repeat.
Would it not make more sense to feature more wrestling on Impact, as clearly wrestling is what Vince uses to entice buyrates?
The Journal would not say that wrestling is what is used to entice buyrates by the WWE. The WWE sells “spectacle”, so that includes everything that happens at a show. The culmination of a big match does not mean there will be technical greatness. On the contrary, many big matches that move buyrates often are not technically interesting or sound. But that is not the WWE’s business; they are not there to give you the greatest matches, they are there to give you the best entertainment they can in whatever form they think best to deliver it.
That said, should TNA differentiate themselves from the WWE by having a more “wrestling” related product. While not for the Journal to say, that would certainly give them some type of “unique value proposition” that they appear to be lacking.
Does anybody in charge of TNA want the company to grow or are they happy with a continuance of the status quo?
TNA President Dixie Carter, once again, has stated point blank that she is not satisfied with the status quo. The whole point of hiring Hulk Hogan and Eric Bischoff was to expand the awareness of the company and to get them to grow rapidly. While their small growth has been stellar, she is not happy with the progress and wants to see the company “go for broke”.
The Journal will contend that TNA should stick to organic growth and focus on profitability instead of revenue and ratings, but that is not the strategic direction they have decided to go in. While TNA is the second largest wrestling company in the world, the gap between them and number one is too much for Ms. Carter to stand. This line of thinking is what V would also like to work against:
TNA will never be in a position to “beat” WWE, in the same manner Sun, Adobe, or Mozilla will never be in a position to “beat” Microsoft but this doesn’t make them poor companies.
It’s not about bettering WWE, being bigger (Apple’s market cap recently eclipsed MS despite smaller profits) or overtaking them it’s about turning a profit. As Guest 6614 has said and Vince has shown sales are vanity, margins are sanity.
If TNA can balance expenditure over returns there’s no reason for them to be considered a failure. The tricky part is at what point do TNA abandon profit in pursuit of growth, and organic growth at that.
WCW “beat” the WWE in every metric (with the exception perhaps of major PPV buyrates) for nearly two years, so never is a tough world. However, your third paragraph brings it all together. All TNA needs to do to be successful is have expenditures less than revenue. If profitable, TNA can continue forever. Now, it would appear that TNA is willing to forgo short term profits in the name of long term growth. Unlike the WWE, TNA does not have a large pool of cash to just go on a growth spree with, so this could hurt the company. Some cost cutting measures have already happened (notably with TV tapings), so it would appear that the company realizes they do not have enough to go into the red for long.
Finally, just to make this reporter smile, Donk says:
“let this reporter state that the Journal does not usually address unfounded rumors”
With all due respect, almost 100% of the ‘news’ the IWCS sees is ‘unfounded rumors’. NONE of us are ‘there’ or ‘know the real stories’. Just what we read, so if you didn’t speak about ‘unfounded rumors’, that would eliminate just about everything.
To which Guest#1694 so succinctly replied:
Quarterly statements, ratings, marketing releases, legal filings, and general business truths are certainly not unfounded rumors.
If they are not close to ‘real truths’ the SEC might have something to say, since WWE is a publicly traded company and Linda McMahon has some public exposure here.
So no, when we eliminate ‘unfounded rumors’ we are left with real information. Really the meat of the industry.
Thanks for reading the Journal, Guest. Donk, this reporter hopes you incorporate the words you read in this article next time, too.
Plenty more was written, so be sure to take a look. And if you enjoy the Journal, why not bookmark 411wrestling.com and make it your home page? You can do that by clicking here.
This concludes Issue #141 (Volume 2) of THE HAMILTON AVE JOURNAL. Join us next week as we get ready to ring the bell again.
Till then!
