Last week, we reported that WWE was eradicating itself of the world “wrestling.” John Cena and Randy Orton are no longer wrestlers – they’re “superstars” and “sports entertainers.” Even the company’s name is getting an overhaul – dropping the phrase “World Wrestling Entertainment” in favor of simply “WWE.”
The Los Angeles Times has a feature article looking at the latest re-branding efforts of WWE, which includes many new details on the company’s strategy moving forward as well as comments from the chairman himself, Vince McMahon.
“I think every brand has to re-create itself,” McMahon said. “I want everyone to look at us in a vastly different way than they have.”
The article says McMahon plans to go on a spending spree to acquire media assets that could expand WWE’s business beyond the ring. In particular, WWE is targeting companies involved in production, live entertainment and branding.
“It is a logical broadening of what we already do,” McMahon said. “No one does television production better than we do, it’s damn near the Olympics. We know more about live event touring than anyone in the United States.”
With very little debt to speak of and almost $70 million cash on hand, WWE has deep pockets and the ability to make their vision of expansion a reality.
Aside from acquisitions in the production and live entertainment arenas, WWE is also moving ahead with its planned cable channel and has already met with distributors (including Verizon) in hopes of launching the WWE Network in 2012.
Analysts are mixed on whether WWE should expand outside of its core business, or whether it should be more conservative with its spending and focus on internal matters and improve areas of business that have been suffering in recent years.
Jay Kaplan, portfolio manager for Royce & Associates, which holds about 9% of WWE stock, was interviewed for the LA Times pice and said, “I think that the most important thing right now is the return of the health of the core business. One of the market’s big concerns is are they losing market share to real fighting.”
The article looks at the mixed results WWE has seen when branching out beyond the realm of pro wrestling – with the XFL and WWE New York ventures falling flat.
Some analysts wonder whether WWE wants to grow to position itself for an eventual sale. With Vince McMahon in his mid 60’s and his wife Linda gone from the company, the article speculates whether this planned expansion is taking place in anticipation of an eventual sale. Without mentioning that his daughter Stephanie and her husband Triple H are being groomed to be the next generation of WWE leadership, Vince shot down the idea of selling the company.
“We’re very independent-minded,” he said. “I don’t see that happening.”
Overall it’s a great read, head over to LATimes.com for more on WWE’s re-branding strategy.
