SBJ/October 10 - 16, 2005/SBJ In Depth
The making of a fight
Published October 10, 2005
“My heart dropped,” said Shaw, who chose the NHL arena as the homecoming site for IBF super middleweight champ Jeff “Left Hook” Lacy, an Olympian who was raised in St. Petersburg. “I didn’t say it to anybody, but I thought, ‘How am I going to fill this place?’
“Jeff’s got a great smile and he’s a great kid, but he doesn’t have this many friends.”
Unbeaten in his first 19 fights, Lacy wanted to show off his talents near home. Shaw was skeptical, but he promised to look into it.
Major prize fights stem from varied origins. Most often, they’re conceived by promoters, such as Shaw, or the more familiar Don King or Bob Arum. Sometimes they’re driven by TV networks or venue operators.
This one was born when Shaw convinced Showtime to give Lacy his first shot as a headliner, placing him atop a card that it would show on Aug. 6. Showtime, which has aired Lacy’s fights since he turned pro in 2001, would pay Shaw a licensing fee, estimated by industry insiders to be about $500,000.
Even as Showtime has moved away from contracts with individual fighters, it has kept an ongoing deal with Lacy, who the network signed as part of a multifighter, multifight package coming out of the 2000 Olympics.
“Jeff Lacy is an anomaly for us in that respect,” said Ken Hershman, senior vice president and general manager of sports programming at Showtime. “He’s never in a dull fight, so he fits our promise to subscribers. The only question for us is who he fights and when.”
With the vital television deal sealed, Shaw started working on the who and when.
The first one was relatively simple. As the IBF super middleweight champ, Lacy was due to defend his belt against the sanctioning body’s highest-rated available contender, Robin Reid, a former champ from England whose better days are behind him. After a brief negotiation that wrapped up April 14 — almost four months ahead of the fight date — Reid agreed to fight for $80,000, plus any TV revenue generated in his home country. Lacy, the headliner, would get $150,000, his largest payday to date.
Picking the site required some boxing calculus. Like many fighters, Lacy had been making noise about fighting near his hometown. Shaw hated the idea, in part because it might distract Lacy but also because the fighter had not proved he could sell tickets.
Even the most appealing matchups are not guaranteed to sell. When lightweights Diego Corrales and Jose Luis Castillo squared off at Mandalay Bay in May in what likely will be the fight of the year, they drew 5,168 people, with barely 2,000 paid, according to Shaw, who co-promoted the bout.
A casino such as Mandalay can afford a small turnout, because it uses fights to attract gamblers (see related story). An arena fight usually has to sell well to make money.
To lessen the risk of a box-office flop with Lacy, Shaw started his site search with a call to one of Tampa’s smaller venues, the Seminole Hard Rock Casino. Executives there said they weren’t interested. Lacy suggested the big arena, which hadn’t hosted boxing since Roy Jones Jr. fought there in 2001.
Shaw phoned Forum executives to check on the date. When they told him it was open, he flew to Tampa to meet Sean Henry, the executive vice president at the arena, and Elmer Straub, the director of events.
Jeff Lacy celebrates his victory in front of a hometown crowd at the St. Pete Times Forum.
“Their attitude, more than anything else, made me desirous of going to the arena,” Shaw said. “They were gung-ho. They made me feel like I had a partner that wanted the event to succeed as much as I did.”
Henry promised to market the fight to the arena’s database of about 70,000 customers and pledged that a ticket sales staff of about 50 would treat it as if it were their own.
They structured a deal that protected Shaw against financial disaster while allowing him an upside. Base rent would top off at $50,000 for the night, with the arena providing most of the event staff, including ushers and security. Shaw also got the use of one suite, as well as 30 days to advertise the event on a highway billboard controlled by the arena and a sliver of the arena’s radio advertising inventory.
Revenue was divided cleanly. Shaw got all proceeds from ticket sales. The arena kept what it made on concessions. They split profits from merchandise. Each side would keep most of what it could bring in from sponsorship sales.
Shaw returned to his New Jersey offices to prepare a promotional plan that he likened to a political campaign, crafting a grassroots strategy in which Lacy was the candidate.
On June 2, Shaw announced the fight at a press conference. Ticket prices ranged from $25 to $500, with most seats at $50 and $100. Shaw also carved out 330 ringside VIP seats priced at $1,000 each, selling 266 of them to a Tampa law firm headed by Jim Wilkes, an attorney who advises Lacy. That price included a pre-fight party at the arena club.
In the first few days, they sold about 5,000 tickets, getting Shaw more than halfway to the 8,000 that he’d set as a goal, albeit one he kept to himself.
To build from there, Shaw and his staff went on an old-school promotional blitz worthy of P.T. Barnum. He spent about $3,000 to post banners bearing Lacy’s face on downtown lightposts. He hired the Tampa Bay Lightning dance team and sent them riding up and down the busiest street in Tampa in a limo, handing out flyers along the way. He distributed banners at every strip club in town.
At the same time, the arena staff was going the more traditional route, sending waves of e-mail blasts to Lightning season-ticket holders and other customers. Shaw sent Lacy to the local morning talk shows and got him on TV. He said he spent about $100,000 on local radio spots.
On fight night, Shaw hired face-painters, clowns and stilt-walkers to entertain on the grounds outside the Forum.
“When people came to the arena, they didn’t know if they were at a fight or a circus or a carnival,” Shaw said. “But they did know it was an event.”
The final accounting shows an event that overachieved by most measures. The card, which drew a boffo crowd of 15,056, generated $1,067,380 in ticket revenue and about $500,000 in U.S. television revenue. Shaw ceded international TV fees to Reid.
Sponsorship was spotty, as it has been for fight cards across the United States in recent years. They landed a Miami Beach hotel to advertise on the ring canvas, lined up a sponsorship deal with a local car dealer and sold some program ads, all of which combined for about $100,000 in revenue. But none of the local beer distributors bought into the fight. And the Hard Rock stayed on the sideline.
On the expense side, Shaw paid $230,000 in purses to the two headline fighters and another $44,000 to the 16 undercard fighters, with payouts stair-stepping from $1,000 to $6,500. He spent about $50,000 for entertainment at the arena on top of the $50,000 in rent. He put about $325,000 into marketing the card, bought about $60,000 in tickets to distribute for promotions and paid about $40,000 in travel expenses.
Factoring in other expenses that Shaw wouldn’t specify, he estimated a profit of about $300,000 for his promotions company from the card.
As for the arena: Food and beverage generated about $20 a person, Henry said, which was well ahead of the $12 per person brought in at Lightning games and about $4 a head more than what comes in from the hardest-spending concert audiences.
Shaw and Henry both pronounced the fight an economic and strategic success. “We owe a lot to (Shaw) for putting us back on the map for boxing,” Henry said.
One week before the Lacy fight, Henry closed a deal to host a highly anticipated third match between light heavyweights Antonio Tarver and Roy Jones Jr., who ended up drawing 20,895 to the Forum. Shaw said he would like to bring a card headlined by another St. Pete star, Winky Wright, to the Forum down the line, though a Las Vegas casino likely will be the choice if the matchup dictates a large purse for both fighters.
“Bringing Lacy in there was a real springboard, and it was spectacular,” Shaw said. “All in all, I’d say my candidate got elected that night and it was a beautiful coronation.”