Unabashed Price Slash Seems Just What WWE and Its Fans Needed

Five Questions for Exec VP-Marketing Michelle Wilson

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Michelle Wilson is likely the only marketer in history tasked with selling WWE and women's tennis in the same year.

Michelle Wilson
Michelle Wilson
But Ms. Wilson, who left her post as chief marketing officer at the United States Tennis Association to become exec VP-marketing at World Wrestling Entertainment in February, says the two have more in common than most people realize -- and she wasn't referring to Serena Williams' behavior at September's U.S. Open. "At the end of the day, both jobs are about giving fans the most value and the best experience," she said.

Value has been a key focus for Ms. Wilson and WWE, which managed to boost ticket sales 29% during the third quarter by cutting pricing, a result most leagues envy thanks to a tactic most have tried to avoid.

On the other hand, at a time when people are said to be going out less and staying in more, the WWE saw pay-per-view revenue drop 12%. But the WWE has scored big with social media, not only boasting more than 300,000 highly engaged Facebook friends, but also launching its own platform in hopes of attracting new customers and fostering greater loyalty.

Ms. Wilson said that like tennis, WWE's audience today is "very much gender-balanced. Almost 40% of the audience is female. And at the live events, there are a lot of families," she said.

At USTA, Ms. Wilson was credited with helping improve TV ratings and attendance for the tour's flagship U.S. Open tournament, and before that she teamed with WWE Chairman Vince McMahon and NBC on the ill-fated XFL, a startup football league that scored loads of hype but ultimately failed.

Ad Age caught up with Ms. Wilson recently to discuss the reasoning behind WWE's price cut, the significance of "walk up" and its social-media tactics.

Most marketers in entertainment-related businesses are saying people are going out less and staying in more, yet your third-quarter results show the opposite. You've got attendance up and pay-per-view down. What gives?

From a live-event perspective, one of the things we did was really believe in our positioning as the best value in entertainment. And that became even more relevant with the recession. We took a hard look at our ticket prices. In our larger markets, we looked at our lowest priced tickets and actually lowered them to a $20 ticket. It was more like $30 to $35 in the past. In smaller markets, we actually lowered it to a $15 price point. Our feeling was that, if we price it correctly and deliver a great experience, we believe our fans will still come out. And that's what we've seen.

The results speak for themselves there. But most other sports leagues are reluctant to take that step, because they worry about being able to get that pricing back. Are they wrong?

It always pays off for any business to reevaluate pricing strategy to make sure it's relevant to the marketplace. People tend to shy away from ever taking prices down because the fear is that you can never go back up. But that's one of those myths that can be challenged. If the price/value relationship is right, people will come out. And that's something we can reevaluate when the economy gets better.

But how will you know when that is? Are there specific measures you're watching closely right now as you try to monitor the health of the economy and your consumers?

The great thing is that we do 300 live events a year, so we can see every week what's going on. We monitor attendance week to week. We look at what price points people are buying at. We've seen a lot of what we call "walk up," because in a down economy people wait later to decide whether they have that disposable income to go [to an event]. If we see our walk-up numbers going down, that would be another indicator that a recovery is starting to take place. We also look at our consumer product sales, DVD sales, pay-per-view buys. We'll know right away whether it's picking up or not.

It seems odd that pay-per-view is down at a time people are staying in more often. What do you make of that?

One of the things we've seen is that the number of people watching is going up. There may be one person ordering and three families coming over to watch it. WWE product in general is a communal experience: You like to say "I like the Undertaker," or "I Like John Cena." So in a down economy we see more people watching in larger groups. Pay-per-view in general is a struggle, because people now go by their billing cycle of their cable provider. So one of the things we're looking at in 2010 is one pay-per-view per month, so people don't have to decide whether they want two pay-per-views in a single month. People do make those hard decisions in a down economy.

You have an extremely robust presence in social media, with more than 300,000 fans on Facebook, a very active and engaged Twitter following and even your own, in-house, social-media platform. What's been your guiding philosophy while navigating these new platforms?

Before even coming here, I followed WWE because I thought their digital and social-networking strategies were definitely leading edge. The one thing that WWE has, as we know, is an extremely loyal fan base and a pretty demanding fan base in terms of expecting WWE to be leading-edge on this front. They realized, earlier than most properties, that we should have an official presence on Facebook. And now we've got more friends than the Dallas Cowboys, more than the Chicago Bulls, more than the Pittsburgh Penguins. Our feeling was that our fans expect to be able connect with us wherever they are. So we felt that presence was critical. But we also recognized the importance of WWE.com, which has over 15 million unique visitors monthly*. And WWE created WWE Universe, and already we have over 500,000 followers. So, for us, because the property is about sharing stories and sharing love of the product, we believe we need to stay ahead of the curve on that. We've looked at Twitter, and, quite honestly, we're not sure it's as critical as something like Facebook. It's kind of a one-way dialog and we're not convinced it'll be part of our ongoing strategy.

The level of interaction of our fans is part of the brand's DNA. How to leverage that, to me, is getting other fans engaged. We want to get that current fan base to bring in other fans and help us grow the WWE. That's our greatest next step: How do we use our own fan base to bring in more fans? To me, word-of-mouth is the most powerful way.

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CORRECTION: An earlier version of this story incorrectly reported that WWE had 50 million unique visitors.

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