Back when World Wrestling Entertainment (NYSE: WWE) made a big piece of its revenue from pay-per-view, four of its annual shows were bigger than the rest.
WrestleMania, of course, is always its biggest show of the year, but SummerSlam had become a strong second, followed by The Royal Rumble, and Survivor Series. These shows had longer builds, got more promotion, and generally outperformed the lesser PPVs on the calendar.
Since the switch away from PPV and to the company’s subscription-based streaming service, WWE Network, these shows have become important in different ways. The company has chosen to build these four events by making them the only shows where talent from Smackdown and RAW — its two main television shows — gets to mix.
That’s a big deal for fans. It also allows for WWE to make each of these four events a sort of mini-Super Bowl that cities compete for the right to host. To make them even more attractive, the company has decided that — as it does with WrestleMania and SummerSlam — it will now make the other two shows four-night events, too.
What does this mean?
For years now, cities have made their pitches to WWE in hopes of hosting WrestleMania. That’s partly because the company has sweetened the deal for its biggest fans to travel by offering other events in addition to its main show. This has included live specials from its NXT brand, as well as RAW being broadcast from that city the night after the big event.
Now, WWE plans to make each of its big four events even bigger by pairing it with a NXT special, RAW, and Smackdown. That means the host city gets events that run from Saturday through Tuesday night, which enhances the value of traveling to and staying in the city for big fans.
The impact on a host city can be significant. WWE just released a press release saying that WrestleMania 32 generated $170.4 million in economic impact for the Dallas/Arlington region this past April, according to a study conducted by the Enigma Research Corporation.
Will this work?
While not every event will be the blockbuster success that WrestleMania 32 was, WWE has a large fanbase, some of which is willing to travel. All four of these shows will likely sell out, with many fans going to more than one. That means more money for the company, but also more revenue for the host cities.
Hotel rooms will be filled, meals will be eaten, and money will be spent. Given that, expect aspiring host cities to make the WWE better offers when it comes time to bid on these events.
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Daniel Kline owns shares of World Wrestling Entertainment.
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