“Introducing…The XFL!”
David Bedwell, Craig Bland, and Justin Paris
BUS 470 Senior Business Seminar
2/14/03
The American brand of football, as we know it, was first played in 1869 between
Rutgers and Princeton (nfl.com). Popularity for this quickly grew and in 1920, the
American Professional Football Association (now the NFL) was formed. Nobody could
have ever imagined the transformation this tiny little league would make within the next
80 years. The NFL‟s biggest game, the Super Bowl, had almost become a national
holiday as 29 of the top 100 TV events of all time were taken by the league‟s big game.
In 1999, the Super Bowl took home its highest TV rating ever with a Nielsen rating of
43.3 (Fournier 3). While professional baseball (MLB), professional basketball (NBA),
and professional hockey (NHL) teams experienced revenue problems, virtually all NFL
teams were seen as profitable. Even the lowest teams in the league could operate
profitably without winning. Peter Keating showed a good example of this in a recent
article in ESPN The Magazine. The Cincinnati Bengals were rated as the 118th (last
place) franchise among major sports teams (NFL, MLB, NBA, and NHL) in the United
States based on eight different criteria that ranged from the players they had to the
affordability the team possessed. However, since moving into its new stadium in 2001,
annual revenues are up 50% and operating profits have nearly doubled (Keating 108).
Because of its popularity and promise, media mogul and World Wrestling
Federation Entertainment owner and operator, Vince McMahon, unveiled a plan to start
his own football league beginning in February of 2001. The announcement of the
inception of the XFL (Extreme Football League) shocked the sports universe as
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McMahon quickly began revealing the details of his new league. While the league saw
immense success in its first week, its popularity took a quick downturn, and by week
nine, ratings plummeted to near record levels. On May 10, 2001, WWFE announced that
it would discontinue the league and its operations immediately. According to the
WWFE‟s 10-K report that was filed in the fiscal year 2001, discontinued operations of
the XFL led to a $46.9 million loss (SEC Online). The company still reeled from the
effects of its blunder in 2002, when, according to its 10-K report, net loss from
discontinued operations reached $4.6 million. “As of July 10, 2002, we believe that
funding for the XFL has essentially been completed. Cumulatively, through July 10,
2002, we funded a total of approximately $57.6 million ($32.0 million, net of applicable
taxes),” (SEC Online). These final figures arose after all the dust had settled from one of
the largest sports marketing blunders of all time. In this report, we plan on evaluating the
threats, opportunities and things not thought about in the development of the XFL.
OPPORTUNITIES FOR THE XFL
When McMahon made the announcement for the XFL, WWFE (World Wrestling
Federation Entertainment) stock prices dropped by over 25%. However, there were many
opportunities that the league possessed that were used to their advantage. McMahon was
very successful with his current product, the WWFE, where he possessed a $379 million
multimedia company. McMahon was founder and chairman of WWFE and because of
this he owned 97% of the voting shares (Fournier 8). With the XFL, his attitude and
position was not much different. Not only did he take it upon himself to market the
company, but he also planned on running it as well. He started the hype one year before
the first game was going to be played by unveiling plans for the new league. Other
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opportunities that the XFL possessed were excellent sponsors, strong web base from fans,
a pay scheme that promoted competition, and celebrities such as The Rock supporting the
league.
McMahon began the XFL because he felt that the NFL had too many rules and
was over commercialized. He wanted to “bring football back to its roots” by providing
“old-fashioned, smash-mouth football with cutting-edge marketing and production
values”(Fournier 6). McMahon believed that there was an open market position in
football that had not been realized to date. He felt that fans were getting fed up with
certain aspects of the NFL and were looking for an alternative. He was right in a way,
but he was not ready to go head to head with the NFL. McMahon already had a platform
to stand on with his fame from the WWFE. Because of the WWFE‟s reach and
popularity, when McMahon spoke, people listened to what he had to say. His marketing
campaign began with his announcement for the formation of the XFL in Times Square
one year before the league was to begin. This would give him ample time to find
sponsors, attract a large fan base, and promote hype for his newfound product. In March
of 2000, the rules that were being altered from those of the NFL were announced publicly
to allow people to see what the league was about. Periodically, throughout the year, he
would make announcements concerning such areas as pay scheme, personnel
acquisitions, and cheerleader information to keep the fans informed. McMahon wanted
to make a product that would stand out and differentiate itself from other football leagues
such as Arena Football and the NFL. He did this by creating controversy with the ideas
he supported. Pictures of half-naked women, vulgar language, sexual innuendos, and
loud music were a few that helped get the media involved. These references would cause
the media to write about such instances, and in turn create more awareness for the XFL.
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The advertisements were spaced out from July through the beginning of February of the
next year. These ads promoted the image that McMahon was trying to portray with the
in-your-face football, sexual references, and the stature of McMahon himself. He did an
excellent job sticking to what he originally boasted about; portraying cheerleaders as sex
objects and football players as hard-hitting, athletic machines. The marketing aspect was
very well planned out by McMahon and helped to benefit the league with the responses
of web-site hits they received. McMahon had done this marketing scheme before with
the WWFE, so he was familiar with what it took to raise awareness.
For the XFL to have a prayer, they had to collect sponsors with deep pockets who
were willing to take a chance. The XFL needed strong financial backing to keep their
stock prices up and to alert the public that this was for real, not just another publicity
stunt. McMahon found his first sponsor and co-partner in the form of NBC. NBC Sports
Chairman and friend of McMahon, Dick Ebersol, asked Vince to contact him before
looking at other networks to air primetime games for the XFL. This provided McMahon
with a network that would carry Saturday night games. NBC, at the time was “paying
outsiders more than $1 million per episode for the three dramas it ran on Saturday
nights,” (McGraw). In late March, NBC announced it would invest $50 million, which
was 50% of what the XFL would need for their project. NBC‟s parent company, GE
followed suit and invested $30 million in the WWFE (Fournier 8). McMahon also
collected excellent advertisement sponsors before the season started. With two months to
go before the kickoff of the XFL, 50% of the advertisement time for the game broadcast
was sold. When the training camps began in January, 70% of the advertisement space
had been sold. Such big name sponsors that supported the XFL were AT&T, Anheuser-
Busch, Miramax, Best Buy, Burger King, and the US Air Force among others (Fournier
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15). Part of the reason that these advertisers were willing to spend money with
McMahon is that he did such a great job marketing the league to these sponsors. UPN,
TNN, and NBC guaranteed a combined Nielsen rating of 10, which is approximately six
million viewers (Fournier 15). The sponsors that joined in created a stir in the business
community that this league had a fighting chance to survive. Even though towards the
end of the season the ad times were almost being given away, this area was an
opportunity that did help McMahon succeed for as long as he did.
During the course of the advertisements, a web site was also established as well as
sister sites that would cater to XFL fan demands. Pictures of sexy cheerleaders and
controversy surrounding McMahon ran the headlines. Once again this aspect relates back
to the excellent job that McMahon did with promoting the XFL league. Without fans
knowing about the upcoming league and wanting to get more information on it, there
would have been no need for web sites. No one would have known to visit a web site
about the XFL to get information on season tickets, jersey unveilings, and their favorite
cheerleaders. In October of 2000, the XFL web site tallied only 93,000 less unique
visitors compared to NHL.com. It attracted 377,000 while NHL.com posted
approximately 470,000 (Fournier 15). These figures were quite remarkable considering
the league had only announced its intentions nine months beforehand. In December of
the same year, the XFL web site drew 342,000 visitors to its web site, only 2,000 less
than Major League Baseball‟s web site. This showed extreme interest in this league and
indicated that many fans were looking for something different. Fans were looking for an
alternative and McMahon was giving it to them. By January, the web sites and other
forms generated 65,000 season tickets sales nationwide. These web sites also allowed
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chat rooms to discuss the latest news with other fans and let McMahon realize
merchandising revenue for the future.
McMahon had stated earlier that he was trying to cause controversy about the
league. “Let‟s face it, a lot of what we‟re doing now is creating controversy- that‟s what
we do! He-llooo! That‟s entertainment!” (Fournier 14). This was an excellent marketing
idea because these subplots that created controversy coerced fans into watching games
and spending money. For example, Jesse Ventura stated that one of the coaches made a
“gutless” decision. After the game, reporters wanted the coach to comment back to
Ventura to keep the feud alive, but the coach refused. Rusty Tillman, coach of the New
York/New Jersey Hitmen, said that the announcers were “awful” and fans should turn the
sound off on their televisions when watching games. Even though he refused by
commenting on the announcers, it sparked intrigue. McMahon had been very successful
in creating subplots in WWF because that is how fans stay interested. The WWF is
similar to a soap opera on stage or a theater play. There are plots and subplots happening
between characters that will cause controversy to increase fan participation. The rule of
letting players date cheerleaders also encouraged this aspect. The announcers were
located next to the cheerleaders and if a player messed up, they would ask his girlfriend
why. This created participation and also increased curiosity to fans because this is
something that has never been done before.
Fans enjoy competition and the level of play attracts more fans obviously. People
pay to see skills and they pay to see fierce competition between two teams. Competition
rises if teams are playing for a prize, such as for the Super Bowl or playoffs. McMahon
incorporated this into his plan by paying each player $50,000 on average for the season
and guaranteeing $100,000 per regular season win to be divided among the players. This
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aspect was part of McMahon‟s marketing scheme to increase competition between the
players. “The beauty of the plan is that the costs are contained: Total league payroll for
the eight teams will be less than $25 million. NBC and McMahon will own the entire
league, deriving profits from advertising, ticket sales, Internet rights, and merchandising
sales,” (McGraw). This announcement of the pay scheme came in August along with the
launch of the new XFL football, which was black with red stripes to distinguish from the
NFL. Whenever McMahon announced the pay scheme, fans imagined linebackers laying
out running backs and corners hitting wide receivers while up in the air. This was the
type of hard-hitting action that fans were looking for and they believed that this pay
scheme would help support that idea.
One of the biggest advantages that McMahon possessed coming into this situation
was his name and the people that he brought with him. Fans are interested in celebrities
and superstars. McMahon had access to many superstar wrestlers that were in the
WWFE such as the Rock and Stone Cold Steve Austin. Dick Butkus was appointed the
XFL‟s director of football competition during the early stages of the league. This
provided fans with a sense of belonging to the XFL because most football fans can relate
to what he had done for the NFL. He also hired Jesse “The Body” Ventura as the lead
commentator for the games. Even though Ventura did not have much background as a
football announcer, he did announce for the WWF for an extensive time. This helped
give some of the WWF fans a sense of familiarity when converting to the XFL. Also,
this provided another big name that McMahon had in his pocket to increase controversy
because Ventura was surrounded by it. This was the exact type of announcer that
McMahon was looking for to go hand in hand with the concept of the XFL. McMahon
also used the Rock during some of the games for entertainment to try and boost ratings.
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He used his superstars very well to help market the XFL. There was positive feedback
and controversy from the stars before the season while fans could begin to recognize new
stars on the field.
To make the XFL successful, it had to be similar to the NFL but also different at
the same time. By doing this, the league could establish certain attributes that were only
identifiable with the XFL and not the NFL. The XFL almost became a new TV-based
reality show by placing microphones in private places such as locker rooms and huddles.
This had rarely been done in the NFL, so McMahon thought he could gain meaningful
product differentiation (MPD). To make the XFL even more unique, McMahon placed
cameras into private locations as well. This was one of the first times the new camera
placed directly above the field was used to gain different angles. Now, it seems that the
NFL has adopted this type of camera angle as well as other ideas that were used here.
Fans loved to be involved in games, especially when they can make a difference.
McMahon, throughout the case states that he was a fan himself and he was looking at
football from that aspect. Even though McMahon did not initiate this poll himself, this
was an opportunity that helped raise awareness and involvement. CNNsi.com decided to
get the fans involved before the season began by letting them vote on what rules they
wanted changed from the NFL (Fournier 12). The options were no extra points, no fair
catch, no QB slide rule, and kick-offs must be run back. No extra points won the poll
with 38% responding to this option. This type of poll helped to clarify the XFL‟s
position about what their intent was. McMahon was and still is an entertainer. He
wanted to make sure that the fans involved in his new-formed league were being
entertained.
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THREATS TO THE XFL
The XFL was marketed very successfully from the announcement of the league to
the end of the season. There were just several problems that were not properly dealt with.
These ended up combining together to form a disastrous result. Many business experts
were not surprised when the news came that the XFL was going out of business, but there
were some individuals who were slightly shocked with the news. Throughout this section
we are going to outline some of the problems that we identified as possible threats to their
success.
One of the biggest problems with the XFL was the lack of quality players that
were available to the eight XFL franchises. McMahon wanted to create a new football
league that was known for a more wide-open and faster paced style of football “with an
action-packed, hard-hitting, smash-mouth product,” (Fournier 6). It is very difficult to
have this type of game if you do not have the players to perform this new and supposedly
better style of football. There were not many high caliber athletes that wanted to subject
their body to that type of abuse that McMahon was promoting for a meager $50,000 a
year. They did not face the fact that the quality players were in the NFL making millions.
Most of the bigger named players that the various teams in the XFL drafted were NFL
has-beens (Fournier 13). There were fourteen ex-NFL players drafted in the first round.
Some of the bigger named players included John Avery, Jim Druckenmiller, Vaughn
Dunbar, and Tommy Maddox. These players hardly had the ability or the star power to
grasp future XFL fans. They were on NFL rosters but did not see significant playing
time so they decided to take their skills to the XFL. McMahon claimed that the XFL did
not need big name stars because they were going to create their own stars (Fournier 13).
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You could tell very quickly that the lack of talent was severely going to hinder the
success of the XFL after the first week. Most of the games in the first week were fairly
high scoring with totals of 33-29, 22-20, 15-13, and 19-0, (Fournier 16). There was a lot
of offense and excitement the first week and the viewer ratings showed this with a
Nielsen of 10.1 on opening night. By week three, none of the eight teams scored above
18 points. The lack of talent was the reason for the low scoring performances and the
NBC ratings fell to 2.9 after week three.
Their choice of network also proved a threat to the success of the XFL. While
NBC was clearly a top tier network, their target audience did not match up with the
XFL‟s. “NBC‟s prime-time audience was described as “urban, well-to-do, and highly
educated,” even “the richest, smartest and most savvy viewers of all,” (Fournier 10-11).
McMahon was well known for his scripted and staged activities in the WWFE. We feel
McMahon would have a tough time overcoming the reputation that he had from the
WWFE. The WWFE was known for “excessive, offensive, and degradation, particularly
with respect to the body, stood in playful opposition to the norms and mores of the
dominant culture,” (Fournier 9). McMahon would have a hard time convincing his
audience that the action and all the surroundings were all real and nothing was staged.
NBC received a lot of criticism from within media circles for undertaking this
project. One person even said, “It just doesn‟t fit with their branding strategy, unless they
think they‟re going to get upscale men watching this thing,” (Fournier 11). Resembling
what we mentioned earlier, the prime time audiences of NBC has been classified as the
smartest viewers of all and has a median household income of $60,000. These people are
not the same type of people that spend their time watching “violence, homophobia,
misogyny, twisted sex, negative ethnic stereotyping, and senseless hate to American
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children,” like a large part of WWFE fans (Fournier 10). NBC was known for high
quality family shows and explicit material was generally not in its programming. The
audience that the XFL was mainly trying to target was the male 12-34 groups. The
problem with this audience is pretty simple. How many men in this age group stay at
home from 8-11 to watch football on Saturday night? That was a problem that became
very evident after the first game of the year. Ratings were cut in half from the first to
second week.
The XFL wanted to separate from the NFL and provide cheaper tickets. They did
this by offering tickets for $25 and less, which is much lower than NFL tickets. This
created a problem for NBC because they have the high-class viewers that watch their
prime-time spots and the XFL was trying to get the people with the lower incomes to
watch the games. The ticket pricing strategy of the XFL simply did not fit with the
viewers of NBC. This all boils down to the simple fact that it was probably not the best
decision on NBC‟s part to take on the XFL. Did they stop to think about the impact that
the XFL would have on a high-quality station like NBC? People would watch the dirty
cheerleaders and vulgar announcers and automatically associate the XFL directly to
NBC. This type of association provided NBC with the negative connotation of being a
supporter for such atrocities.
Another oversight of the XFL was signing television contracts with three different
television companies for the Saturday and Sunday games. The Saturday games, which
were supposed to be the most viewed games, were to be shown on NBC. The Sunday
afternoon games were on TNN, while the Sunday night games were on UPN. UPN and
TNN saw a bright side in showing McMahon‟s new football league. The TNN president
labeled the XFL as “a total fan experience with the highest production values and
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innovations, intense team action, and rivalries,” (Fournier 12). The president of UPN
said, “that somebody needed to stand up for the high testosterone young male,” (Fournier
12). UPN and TNN were most notably recognized as the stations that aired “Dawson‟s
Creek” and “Country Music Countdown” up until their decision to show the XFL.
Their views on vulgarity changed with the success that both companies enjoyed due to
McMahon‟s WWFE. It did not take long for WWFE‟s “Smackdown!” to become the
most popular and most watched show on UPN (Fournier 9). TNN was also behind the
XFL because of the success from “Raw is War.” Each station was behind McMahon for
the most part and wanted a piece of the profits that were projected.
One of McMahon‟s first decisions was to hire the Hall of Famer Butkus, to be the
XFL‟s director of football operations. In November, Minnesota Governor Ventura was
hired to be the head commentator in the television booths. McMahon said that Ventura
was “naturally opinionated, charismatic, and genuine just like the XFL would be,”
(Fournier 13). While we feel that Butkus and Ventura provided the XFL with a certain
amount of star appeal, their experience and expertise in the positions they were placed in
did not match up. They were hired to make the XFL seem more appealing, but their
positions needed more than appeal. Ventura was probably hired as a publicity stunt to get
people talking about the XFL and asking themselves what types of things might he say on
the air. The problem with this is that, as an announcer, his primary duties did not include
creating controversy. They included calling the action on the field and relaying a message
to the fans. Once an announcer becomes a distraction from the competition, how
effectively is he/she doing his/her job?
One significant area that the XFL tried to promote was the different rule changes
from the NFL. The XFL would have a shortened halftime, less time in between plays, an
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allowance for more aggressive tactics. There were also an additional five rules that
included no point after touchdown kicks. They made this rule because they said the kicks
provided no physical action. The second rule said punts that went twenty-five yards or
more were live footballs, which meant that there was no halo rule like the NFL. The
receiver was subject to any hit that the punting team could dish out. The third rule said
that the receivers and defenders only needed to have one foot in bounds when catching
the ball. The fourth rule banned the quarterback slide. The XFL wanted to prohibit any
type of action that might be deemed non-physical. The last rule change was that all
kickoffs needed to be returned from the end zone with no touchbacks. These rules were
created to make some distance from the XFL and NFL. The XFL‟s Billy Hicks, vice
president of administration, said the rule changes “will eliminate the more predictable
and boring plays, especially on special teams. We are offering changes that do not
change the integrity of the game,” (Hartill 2). Even though the XFL made these rule
changes to promote more physical play, the results ended up being insignificant. To tell
you the truth very few cared about the changes that were supposed to make the XFL
better and more interesting than the NFL. They did not have something unique enough
that set them apart from the NFL. The changes that they made did not make the games
any more exciting to watch than NFL games. Football fans were not used to all these
different rule changes in the XFL, which resulted in them not caring about them. Not
only were the fans not used to the new rule changes, “there was so much hype on these
new rules, not even the players or refs knew what they were,” (Butler 1). There was no
longer any structure to the game of football that the fans had grown accustomed to over
many years of watching NFL football.
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One of the very interesting rules that the XFL was going to change dealt with the
cheerleaders. XFL cheerleaders were said to be, “the best-looking cheerleaders ever
created,” (Fournier 14). In the NFL it is strictly prohibited for the players to date the
cheerleaders. They did not want any stories in the news about player-cheerleader
relations. This rule was not the case in the XFL where player‟s relationships with
cheerleaders were strongly encouraged and promoted. The XFL was even going to go
over boundaries and provide the fans with access to their personal lives. McMahon
wanted the fans to know their names and even their personalities. They were planning on
running stories about the relationships with the cheerleaders and players for publicity.
The cheerleaders were going to be placed on platforms in the stands with the announcers.
The view of the new cheerleaders would be appealing for the typical WWFE fans but
probably not too appealing for the normal NBC Saturday night crowd of viewers. For the
group of people McMahon was trying to reach with this league, this was probably not a
bad idea. The problem came in the form of the target audience of NBC. While
McMahon felt the XFL would bring change to football, it was not about to effectively
change the viewers of NBC.
The XFL wanted to change broadcasting the way it was known. They decided to
change up some different areas by moving cameras and microphones into areas that they
were not normally allowed during sporting events. They decided to put cameras and
microphones on the sidelines, the locker rooms, and the huddles. This would definitely
give the fans an opportunity to hear and see some things that were never heard or seen on
an NFL game on CBS or FOX. That was the whole point, to present some different
aspects of the game. The threat in this lies in the fact that fans do not really care too
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much for announcers. The announcers and broadcasters should help to provide insight
and flow of the game, not a distraction from it.
While the lack of action on the field was proving to be a concern, McMahon went
back on previous statements about the legitimacy of the league. He said that none of the
action on and off the field was going to be staged or predetermined (Fournier 7). The
XFL was supposed to be completely real and nothing was to be scripted. The incident in
week four started to look like the XFL producers were going to try to do some scripting.
Ventura called the coach of the New York/New Jersey Hitmen, Rusty Tillman, “gutless”
because he would not give an interview. The XFL tried to build off of this feud and
extend the issue, but the issue faded.
The XFL was scheduled to open training camps in January with the opening game
played on February 3. The XFL wanted to have their season right after the Super Bowl
when all the fans were still thinking football. One problem with this concept was the
weather. Each of the eight teams in the XFL had open-air stadiums. While some of these
cities were in better climates than others, the beginning of the season was still in
February. In week two, Birmingham played at New York/New Jersey where game time
temperatures were six degrees (Fournier 16). This was a two-sided problem facing the
league. The players had to play in the cold while fans had to endure chilling
temperatures.
Many businessmen from around the country criticized McMahon and his idea of
the XFL after the inaugural press conference. Many said that there was no chance that
this league was going to compete with the NFL. An Atlanta consultant by the name of
John Bevilaqua said, “In spite of some of the success of professional wrestling, they‟re
stepping into an arena that is really beyond their current expertise, and I think their
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chances are modest at best. What they‟re doing is like Coca-Cola moving from soft
drinks to alcoholic beverages,” (Fournier 7). The competitive sport of football is a
completely different business compared to WWFE. Yes, McMahon had success from the
staged and predetermined matches in the WWFE. What did he really know about
running a football league? If he thought that this would simply be easy because of his
name and reputation, he should have given that idea a second thought. Sure, there are
probably some people out there who watch WWFE wrestling and NFL football, but not
all fans felt this way. McMahon needed some other type of expertise or some expert help
but he said it himself that he does not work well with others. This proved to be fatal to the
league and McMahon.
The XFL and McMahon were lacking in three very important areas when entering
into a business. These areas included a strong financial base outside the WWFE, a single
national broadcasting company, and a strong list of consistent sponsors (Fournier 7-8).
This was a project that was going to take a lot of time and a lot of money. Even though
NBC decided to put down $50 million dollars with GE contributing $30 million, WWFE
needed more financial stability. Sports franchises go for three times that, how could $100
million dollars start an entire football league? In the beginning the XFL had some strong
sponsors buying up airtime. They were selling the advertising packages for $145,000 for
thirty-second spots. In the beginning, things went well but as the ratings and viewer
interests fell, so did the sponsors (Fournier 17).
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Things Not Thought of by the XFL
There were many oversights that were made by McMahon and league executives
when marketing and planning for the XFL. One thing that was not thought of was the
direct competition they would face from the Arena Football League. True, the NFL was
obviously their main competition with 113 million viewers on any given Sunday
(Fournier 3). However, the AFL had established itself as an effective and successful
alternative to the NFL. The AFL is more family oriented and high scoring than either of
these leagues. The main reason for the higher scores was due to the general differences
in the way the AFL games were played. With a condensed field (50 yards in length, and
85 feet in width), all indoor stadiums with turf, eight men on the field per team, and
rebound nets for kickoffs, the Arena league was much more fast-paced and confined than
the larger fields of the NFL and XFL (AFL Online). According to the Indiana Firebirds
2003 media guide, teams in the AFL scored on average 49.5 points per game (Indiana
130). On any given play, teams can throw a touchdown pass and change the momentum
of the game. This high scoring, fast paced excitement is what has brought fans coming
back to this league time and time again. While they lack the caliber of players that are in
the NFL, most rosters in the AFL are comprised of veterans who have spent significant
time with NFL teams. The AFL, much to many people‟s surprise, has been around for 17
years. They have stood their ground because of the fact that there is a significant
difference between what they put on the field versus what the NFL puts out. Another
factor that made the AFL more of a direct competitor was that their season ran during the
same months (February through May).
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We had a chance to speak with Curt Hunter who is a Communications Assistant
with the Indiana Firebirds. Curt graduated in 2001 from Indiana University, with a
degree in Sports Communication. After graduation, he spent six months with the Orlando
Predators (AFL) before coming to the Firebirds last year. When asked about the
difference between the XFL and the AFL, he had this to say: “The AFL had already been
established as an effective and enjoyable alternative to what the NFL puts on the field.
The XFL touted itself as a smash-mouth football league that was going to revolutionize
the game of football, as we know it. While this idea sounded great, they did not have the
players or the talent level to back this up.” Another reason for the success of the AFL is
the family-oriented atmosphere that is created. “Aside from the fact that AFL fans are
closer to the action than any other football league that exists, we also have other effective
measures that involve families. It is a requirement for the players to stick around after
the game and meet with fans and their families for autographs and pictures.” When asked
why he thought the XFL did not succeed, Curt had this to say: “Their rule changes, in
my opinion, did not separate them from the NFL. While they had some novelties that
seemed intriguing, people found out once they watched the XFL that there was too much
show and hype and not enough action on the field to back up what they were saying.”
Curt‟s professional opinion goes directly with what we believe to be the downfall of the
XFL, too much hype with not enough performance. “Obviously, our goal (the AFL) is
not to compete with the NFL. We understand that the level of performance that NFL
players put out far exceeds what AFL players can. However, I feel that we have made
our own niche into sports society,” Hunter concluded.
Another oversight the proprietors of the XFL did not think about was the long run
staying power of the league. Through excellent marketing techniques they put
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themselves in a position to have potential success. They had star power (Vince
McMahon, Jesse Ventura, and the Rock), they had the sponsors (AT&T, P&G, Anheuser-
Busch, and Miramax), they had the backing of a strong and powerful network in NBC,
and they had essence of something different to attract the fans. All of these things helped
the XFL to achieve a Nielsen rating of 10.1, which placed them as the highest rated show
in that time slot since the Olympics finale a year earlier (Fournier 1). The XFL
proprietors failed to find a way to keep the attention and the fans coming back. What
fans realized, even as early as the second week with a Nielsen rating of 3.8, was that the
football that was being played on the field was at an inferior level and they could not
back up all the hype they brought about. Sure, they could be successful in that first week;
everybody wanted to know what the league was about. Marketers for this league failed to
realize that all the hype and promise of this league would disappear once fans saw what
they were putting on the field.
Another breakdown by the XFL came with the rule changes that were intended to
entice the fans. “The league will connect with fans by returning football back to its roots,
including fostering a wide-open style of play and faster-paced action while encouraging
player individuality to emerge,” (Fournier 6). We feel this was a direct oversight on the
part of the XFL because the rule changes that they did put in place did not affect the way
the game was played. Some of these rules included: no point-after-touchdown kicks,
making punts traveling 25 yards or more live balls, and a ban on quarterback slides.
While some of these rules were intriguing, they lacked significant change. The Arena
Football League brought about a completely different brand of football with shortened
fields and boards that line the out-of-bounds. The XFL failed to bring about considerable
changes that would make up for the lack of talent they were putting out on the field. No
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matter what rule changes they were going to put into place, the fundamental problem was
that there was always going to be a lack of talent. Their failure to create meaningful
product differentiation showed a crack in their otherwise successful marketing strategy.
Another problem that we found came in the expectations the XFL had of their fan
base. While they planned on feeding off their established WWF fan base, they forgot to
do their research on the average football fan. “Overall, the NFL appealed primarily to an
older (over half the fans were above the age of 35), male, middle class (half of fans made
between $30,000 and $75,000 per year) audience,” (Fournier 4). WWF fans were on
average 12-34 and were much less refined than the average American. Wrestling
matches took on dramatic story lines and the audience members responded in ways that
do not typify the model American citizen. While wrestling audiences stayed young and
spontaneous, football fans were growing older. “The age of the NFL consumer franchise
was also trending upward, as younger males turned increasingly to alternative sports,”
(Fournier 4). Another fundamental mistake is the network they went with. “NBC‟s
prime-time audience was described as „urban, well-to-do, and highly educated,‟ even „the
richest, smartest and most savvy viewers of all.‟ The median household income of NBC‟s
prime-time viewers was $60,000, and the network led the industry in attracting viewers
with incomes over $75,000,” (Fournier 11). With the hard-hitting, in your face, and
brash nature of this league, were they going in the right direction to attract fans? NBC
viewers were primarily well to do and older, but XFL promoters failed to realize this.
The XFL planned on marketing this league towards 12-34 year old males but if this target
market were not the strength of the network they chose, how would this affect the ratings
they had? Obviously this had a negative impact on their ratings and NBC was hounded
for making this decision.
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Fans want to see talent. Football fans were not about the spectacle and spotlights
of wrestling. While the dramatic storylines and hype appeals to wrestling fans, football
fandom relies on watching talented teams with talented players. McMahon announced
that the XFL cheerleaders would be “the best-looking cheerleaders ever assembled” and
that fans were going to be able to be up close and personal with these cheerleaders and
their lives. Players were going to be allowed to date the cheerleaders because McMahon
thought the NFL‟s ban on player-cheerleader relations was “absurd.” To the true football
fan, how important are the cheerleaders? How important is it to know whom the players
date? While it can be a juicy bit of info, true fans (the ones the XFL was aiming at) do
not really care about these things. Fans want to see talent and they want to see action, not
novelty. According to the Regional Combine Service, there were five professional
leagues that were comprised of approximately 1,900 players. Those leagues spanned
from the United States to Canada and even over into Europe (NFL Europe). With all
these other leagues essentially dipping into the same talent pool, the XFL failed to realize
the competition they would face for the most talented players.
The final piece of information that was not well thought out came in the process
for the product development of the XFL. In Principles of Marketing, we learned about
the six steps that must take place before a new product hits the market. These include: (1)
Idea Generation (2) Screening (3) Concept testing (4) Coming up with a prototype (5)
Using a test market to unveil the product (6) The actual rollout of the product itself
(Williams 10/14). We feel they did an adequate job at some of these steps, however the
overall process was neglected. One example is the way they used the Internet site
XFL.com. “In December XFL.com drew 342,000 unique visitors, only 2,000 less than
MLB‟s well-established site,” (Fournier 15). While the Internet is a useful tool and we
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can get a lot of information from it, using the net complicates the test marketing process.
“Yes, we need the Internet, but in addition to all the scientific, medical, and historical
information (when accurate), there is also a cesspool of waste… There is no quality
control on the Web, and there isn‟t likely to be any,” (Herring).
Quality control also plays an important role in the product development process.
Quality control is the assessment of product compliance with stated requirements and
should be independent from production (www.dictionary.com). Through inspection of
the product the league would put on the field, they could have used some quality
assurance mechanisms to see that the hype would not match the level of play. Ignoring
this process had proved fatal for manufacturing corporations but it also had the same
affect to the XFL. While they were not actually coming up with a final product, the play
on the field served as such.
Our Solution
Even though the XFL was a disaster in financial terms, there were certain aspects
that could have been changed to make a difference in the league. As we have mentioned
earlier, McMahon had found a niche in the market that possessed much enthusiasm and
revenue for the XFL. McMahon‟s initial goal of creating an alternate league to the NFL,
which was more aggressive and hard hitting, was a great idea because the demand was
present. The XFL made several fundamental errors that we believe could have been
corrected to carry on through more than just one season. Some errors were insignificant
and did not play a huge role in its demise, but others had a considerable effect on the
outcome.
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The fundamental error that McMahon made, as we mentioned earlier, is that the
league was over-marketed and the hype that was created was too high. What should have
been done was to market the product enough to raise awareness and bring about curiosity
but not to the point where expectation levels are unattainable. The bar was set so high for
the league that fans expected cheerleaders to be completely naked, and player‟s heads
rolling when they got hit. “Don‟t promise violence and not deliver it. They should have
had one player on each team armed with a gun. And the cheerleaders should have been
naked…You have to have a product,” (Della Femina). What McMahon should have
done is something similar to the Arena Football League. Arena Football has been around
since 1986 and really did not get popular nationwide until approximately three or four
years ago. McMahon tried to do the same thing, in twelve weeks, that it took the Arena
league seventeen years. By over marketing his product, McMahon in a sense created an
artificial demand that could not be met. It is like when stock prices get over inflated, but
there is nothing substantial to back it up. McMahon could have announced the league,
made several announcements throughout the year, and kept some aspects of the game
hidden to create curiosity. These announcements did not have to carry so much weight
with almost a year or six months to go until the league actually started.
In the end, “The curious found too little shock and scandal; the football fans
found too little decent football,” (Crain). Primarily, McMahon should have informed the
fans of his creative, new league rather than try to persuade people to jump on the
bandwagon that early. He should have realized this concept and made the appropriate
marketing changes that we have discussed here. Even though this solution could have
helped McMahon in his pre-launch, it also might not have created enough demand and
awareness for the product at the start of the season. Also, if the demand were to be
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created slowly, as we propose, McMahon might not have been able to achieve the
financial backing from major networks and corporate sponsors.
The rules that were changed from the NFL were not significant enough to cause
differentiation between products. As we have mentioned earlier, the fans must be able to
separate the NFL from the XFL when attending or watching these games on television.
Once again, when marketing these new rules, McMahon exaggerated that they would set
his league above the NFL. While this idea did help to stir up controversy and public
reviews, there was not much substance behind this. The XFL needed to set itself apart
from the NFL and AFL by achieving significant rule changes that neither possessed. The
AFL did so by shortening the field and placing walls down the sidelines. This caused
fans to immediately brand the AFL and keep it separate from the NFL. In the XFL, fans
saw eleven players on the 100-yard field and immediately thought of the NFL. Even
though these rule changes needed to be more noteworthy, there could have been
consequences where they were too drastic and turned fans off to the league. There
needed to be differentiation and separation as McMahon promised.
There are precautions that McMahon could have taken to try and ensure the
stability of his league. Examining all possible competitors is one way that he could have
done this research. Investigating how these leagues got their start and have sustained
their fan base through the years would be yet another way that McMahon could have
generated ideas. For example, Arena Football had plans to come out with a minor league
system right at the same time that McMahon was coming out with the XFL (AFL2
online). The XFL, by understanding its competitors and their intentions, could have
foreseen future problems of coming up with player personnel. The AFL2 not only was a
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competing league, but a large one at that. The AFL2 features 27 teams that are spread all
throughout the country in cities of varying sizes.
The final solution that McMahon could have considered would have been to
choose a different network for airing league games. Even though Ebersol was a close
friend and NBC did contribute 50% of the $100 million needed, the target market was a
mismatch for the image McMahon was displaying. McMahon could have went with a
different network that is more adept to handling such vulgar language, partial nudity, and
open commentary. UPN and TNN were good choices for McMahon, but he needed a
main broadcast partner such as USA or MTV. The time slot that was given by NBC on
Saturday night did not promise much response in the form of ratings because this is one
of the lowest rating time slots available. By understanding that new leagues take time to
develop, there could have been a more appropriate time slot. This could have been an
effective way of test marketing the product the XFL planned to offer. The XFL could
have started with cable networks and moved into prime time viewing later in their
product life cycle. At this point, the XFL was not ready for the image that NBC portrays.