WWE News WWE News: Additional news from McMahon conference - Tout investment, PG-TV, Superstars & NXT, Smackdown dragging down attendance, big Social Media push, WWE Studios, more
Aug 2, 2012 - 11:35:50 AM
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By James Caldwell, PWTorch assistant editor
The following are additional highlights from WWE CEO Vince McMahon's quarterly conference call with investors held Thursday morning. WWE CFO George Barrios also fielded several questions during the call. (WWE Network and WWE PPV news in WWE News section.)
-- WWE said they invested $5.0 million in Tout, but would not disclose the percentage ownership they have in Tout. Barrios stressed in his opening remarks that WWE believes they can "dramatically increase earnings potential" by growing the WWE brand through social media, which they view as a "critical competent of brand presence." Essentially, WWE is anticipating a very big social media push in coming months and years as they "continue to extend use of social media."
Barrios acknowledged it's tough to put a monetary figure on what social media means for their business, but the company believes it's the next step in reaching their audience since WWE is "about content and promoting it." Barrios said they will eventually monetize eyeballs through social media, but they are mainly focusing on increasing brand awareness and presence.
Related to that, management said they invested in Tout because they believe it worked for both companies - they could use Tout's technology to grow their brand and Tout's presence would increase through a partnership with WWE. Another key is they believe Tout can help them reach international WWE fans through social media.
-- At the end of the conference call, Vince McMahon was asked if WWE has intentionally tried to be edgier in recent months, and whether that contributed to an increase in business. McMahon said, "It is an evolvement. The writing of the shows is considerably better." McMahon said they are trying to write their shows in a more sophisticated manner to where they can remain PG - which McMahon said "opens so many doors" for them - but within that environment, they can stretch certain segments without going into TV-14 territory.
-- Management acknowledged Smackdown attendance dragged down Second Quarter 2012 live event business. "The Smackdown brand is behind where we want it to be," Barrios said. Barrios stressed WWE's recent investment in upgrading the house show production value to more closely resemble TV & PPV, which they hope will increase future attendance.
-- WWE provided no update on the future of Superstars and NXT on domestic television. CFO Barrios was asked about it twice, but did not say whether they are working on domestic distribution. Barrios noted they continue to monetize the shows internationally and also detailed the changes to NXT with TV tapings at Full Sail University.
-- Regarding the new Main Event show on Ion Television debuting in October, McMahon said they believe it will allow them to reach a new audience they currently do not have.
-- WWE said they are pleased with the "No Holds Barred" DVD re-release performance as part of their new films strategy. Barrios chuckled as he said it only cost them $100,000 to re-release the movie and they expect an eventual profit of $300,000.
Later, when discussing other ways to generate revenue off-shooting from their "core competency," McMahon said he believes they finally found a movies division formula that works, which includes co-financing and co-producing movies and acquiring movies.
McMahon added that they can reality shows like Tough Enough, tap into the "John Cena brand" individually within the WWE brand, and they can generate other content from their "variety shows" on Mondays and Fridays with Raw and Smackdown, respectively. "Sure, there's wrestling in the ring, but there's variety," McMahon said. He said they can expand into drama, comedy, and music.
Overall, McMahon said he believes there is increased demand and an "insatiable appetite" for their product. As a result, WWE is trying to maximize opportunities to distribute their content in a variety of ways both domestically and internationally.
-- Regarding the under-performing WWE Magazine segment, Barrios said they are re-doing the cost structure in hopes of surpassing break-even levels.
-- Regarding their website, Barrios said WWE has made "a lot of operational improvements to the site," and they are trying to close the gap between their fast-growing social media presence and their website presence.
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