The WWE this past week sent out an e-mail blast to a mailing list which included many if not most people who have had the WWE Network and dropped it, where they could sign up and get the network free for the next 11 weeks.
The offer specifically mentioned getting four PPVs free, a term that would start with Survivor Series, include both December PPVs, and finish off on 1/31, meaning they would get the Royal Rumble free as well.
The offer was sent to a portion of former subscribers, as well as those who arenít subscribers who have e-mails on file with the company from promotions, ticket purchases, merchandise purchases, etc. Exactly what portion it would be is not known, but we do know people who have signed up multiple times for free offers by changing their e-mails and every single one of those e-mail addresses then got this free offer.
We do know that people who have switched e-mails to get free months in the past, or switched from using a U.S. address to their home address when it was legal to get the network in their country, and they received the offer to the ďU.S.Ē e-mail address, and are actually current subscribers, which actually encourages them to drop being paid subscribers for 11 weeks.
The offer pushes that you could see the Brock Lesnar vs. Goldberg ďMega match,Ē this week, as well as TLC, Roadblock and the Royal Rumble, but that to get the free 11 weeks you have to order by 11/21.
They noted that other subscription services have done similar promotions. Obviously in giving 11 weeks free, the hope is to entice them back to being paying subscribers. The downside is that for the people who were going to subscribe starting around Rumble time, for the Rumble to Mania season, they are getting Rumble free and thus may not subscribe and pay until Mania. The goal would be to entice back paying subscribers to make the January to Mania period more successful for growth than last year, which financially was not nearly as successful as the year before as far as paying subscriber growth for that period had been. A lot of that was due to offering Mania for free last year as an enticement to get people to sign up and pay, but the paying would come weeks after Mania. It did work to a degree, but overall, was less successful than the year before without the free Mania.
The timing is notable because it shows that the company believes the value to Royal Rumble as far as building subscriptions is more its ties to WrestleMania as opposed to a standalone event. The idea is that the last thing fans will get is the Rumble for free before the subscription kicks in as a paid subscription. Given the list of people who get the app and have purchased merchandise that donít have the network, as well as those who have dropped the network, that list is likely millions of people. That isnít to say that everyone on those lists got the offer, as it was described to us as a test of whether this type of marketing would be effective, and WWE officials noted to us that Hulu and Spotify have already used this type of marketing. But if it was sent to millions and if even 20 percent forget to cancel, or decide they like the network enough and donít cancel, the offer could be a game changer that would show up on the books when they announce numbers the day after WrestleMania. Plus, if they have a ridiculous number of free subscriptions on 12/31, at the conference call in late January or early February, they can point to that as growth for the future even if the paid number is down. If the paid number fell again this quarter, it would cause another stock price drop. WWE stock is down 17 percent in value at press time due to the disappointment of the network subscription numbers falling over the last quarter.
The stock has inched up, finishing at press time at $17.81 per share, leaving the company with a $1.36 billion market value, so even though down from the last call, it did inch back up 4.6 percent over the past week.
If someone who orders the network January through WrestleMania, or three months of the year and spends $30 on it, but they got this order, the way this is timed, with Mania in early March, that they would still be spending the $30 unless they canceled and then didnít restart until Mania, and then would have gotten what they wanted for $10. The idea is if the Rumble angles build Mania up well and people decide to continue through Mania, thatís $30 as well. And some, after trying it out, will enjoy it and stay regular subscribers. So as a promotional gimmick, on paper, this looks like a win. The key to this is only people who got the offer can use it, so if you are a current subscriber, you canít cancel, then take the offer and get three months free, and then sign up later, unless you have signed up in the past with a different e-mail address and they have sent you the offer. And there are many people who fit into that category who have noted to us they are canceling their paid subscription through 1/31, but in dealing with this type of marketing, you will get that, but the number of additions always far more than makes up for the numbers of people who make switches to save money.
Also, all new sign-ups will only be allowed through 11/21, basically forcing people to not put it off and just not do it if they are considering doing it.
Itís notable that this gimmick will never be mentioned on television. Except for the people who got the e-mailer, they actually donít want people knowing they are doing it, or at least donít want such a thing publicized.
In addition, WWE is now, if you do cancel the WWE Network, offering everyone who cancels one free month, which they have to refuse, before cancelling them. So if word gets around, literally anyone with a current subscription can cancel and then take the free month, and save themselves $9.99.
One of the issues with the network is the huge number of cancellations, far beyond what anyone ever expected. The issue isnít that they canít get new people to subscribe, but more that they canít keep them, even though given what is offered at the price itís offered seems like a bargain. It may be economics of some members of their fan base, and it may be that they are driving fans away with so much free programming. WWEís continually offering more content is tremendous for fans where pro wrestling is their life, but it is burdensome on those who donít have many hours a week to devote to pro wrestling.
WWE sources categorized this as new test marketing of the WWE Network. They are trying to find out what motivates different types of people within their fan base.
UFC is doing something similar on a more limited basis, as anyone who purchased a ticket to the show in Madison Square Garden who doesnít get Fight Pass can sign up and get two months of the network for free. Of course those people already paid in the range of $1,000 for tickets so in their case, the price of Fight Pass is not a barrier to entry.