Is the challenge and rev3 merger going to have impact in europe ?

peter kern

https://www.facebook.com/ChallengeRoth/photos/a.369912444277.209935.367695289277/10153147379819278/?type=1&theater

as it says in the title what do the business minded people on here think . I guess its going to have an impact on the Us market but in Europe ?

Or will that mean that challenge races outside roth will get more recogniton by people that prefer to buy branded products ?

What is the likely 5 year implication of this merger for the market ?

Is this likely to change the business model of challenge from frachise to full race organicer like Ironman did some years ago? ( i think in the recent 18 month they ( challenge) must have realized that this leaves them vulnerable to race buyouts by competiors losing three flagship races)

sconhome

Interesting move.

From my own reading and understanding the Rev3 gain an organisation shakeup by being partners with Challenge and I suspect Challenge gain a stronger foothold in the US market as a result of the merger.

There has to be a synergy for this to work otherwise it is just a merger / takeover.

mossym

AKW wrote: »

.e it is just a merger / takeover.

isn't that what it is essentially? were rev3 not struggling a bit, model not working? looks like a takeover by challenge more than anything else

Fazz

I think it's a good thing all round.

Challenge needed more of a north american presence in order to build their brand and impending pr launch of world championship i imagine.

Only a matter of time, should be good for the pro's as they are introducing more payouts such as Bahrain.

WTC too much of a venture capital project, challenge seems more triathlon minded and can only be a good thing.

Bahrain potentially due to be an ironman in the future, or at least a 70.3 champs race that needs qualification.
The UAE is doing fantastic things for triathlon with the Bahrain Prince an addict himself so for Challenge to partner with them should be exciting in the future starting in December for that epic half ironman.

So for competition and triathlon i am looking forward to seeing their direction and want to do some of their races in support.

The one big thing they could do now is live tv coverage in December. Would really set the mark after today's 70.3 world's disgraceful lack of tv feed.

Go Challenge.

peter kern

mossym wrote: »

isn't that what it is essentially? were rev3 not struggling a bit, model not working? looks like a takeover by challenge more than anything else

What makes you think that the model wasnt working ?


Fazz do you think Challenge will deepen their colaboration with Itu (etu) or go for its own world champ? given the fact that with the Bahrain race they have now a chance to become a true global player in the half distance.

mossym

peter kern wrote: »

What makes you think that the model wasnt working ?

they were offering big prize funds in an effort to attract the pro's, and it wasn't happening. total u turn then and no prize funds. soon after that, they "merge" with another organization

a total u turn like that , quickly followed by a merger with a rival organization, in business usually means either a realisation that the business mdoel was flawed and overhaul is needed, or that the planned strategy required some core competencies the company was missing, a situation that is rectified with the merger.


that suggests to me they realised the model wasn't working. that's not to say it's definitely the case, but the signs are there. course running sports as businesses (Even though they are) is always a grey area.

they've now gone from big money and not attracting the big pro's, to joining an org that is attracting the pro's, so back to their original plan. again suggests to me their model, on their own, wasn;t working, but with challenge it will.

i'm looking at this from a pure business sense, not anything to do with the quality of their races/ag numbers.

what it does provide, is critical mass to challenge, who've been losing races to ITU, and the elss races they had the harder the fight against a roth takeover would be, which has to be the main itu goal.

tunney

mossym wrote: »

they were offering big prize funds in an effort to attract the pro's, and it wasn't happening. total u turn then and no prize funds. soon after that, they "merge" with another organization

a total u turn like that , quickly followed by a merger with a rival organization, in business usually means either a realisation that the business mdoel was flawed and overhaul is needed, or that the planned strategy required some core competencies the company was missing, a situation that is rectified with the merger.


that suggests to me they realised the model wasn't working. that's not to say it's definitely the case, but the signs are there. course running sports as businesses (Even though they are) is always a grey area.

they've now gone from big money and not attracting the big pro's, to joining an org that is attracting the pro's, so back to their original plan. again suggests to me their model, on their own, wasn;t working, but with challenge it will.

i'm looking at this from a pure business sense, not anything to do with the quality of their races/ag numbers.

what it does provide, is critical mass to challenge, who've been losing races to ITU, and the elss races they had the harder the fight against a roth takeover would be, which has to be the main itu goal.

Agree.

For all the talk about pros and prize money and pros this and pros that. no one really cares.

peter kern

but i it could also mean that they realised that they are to small to survive in the market regardless of any business model. NO ?

Also do you think that they would not have talked to each other before the prize money change and maybe wanted to test the water what happens if they change? Unless you are right and it was an SOS merger I would think it would take quite some time to find agreements study the market etc or not ?

I almost think its more that challenge with the Penticon fiasco and atlantic not going well realised their brand is too weak in the Us and they need somebody capable to run the Us part .

mossym wrote: »

they were offering big prize funds in an effort to attract the pro's, and it wasn't happening. total u turn then and no prize funds. soon after that, they "merge" with another organization

a total u turn like that , quickly followed by a merger with a rival organization, in business usually means either a realisation that the business mdoel was flawed and overhaul is needed, or that the planned strategy required some core competencies the company was missing, a situation that is rectified with the merger.


that suggests to me they realised the model wasn't working. that's not to say it's definitely the case, but the signs are there. course running sports as businesses (Even though they are) is always a grey area.

they've now gone from big money and not attracting the big pro's, to joining an org that is attracting the pro's, so back to their original plan. again suggests to me their model, on their own, wasn;t working, but with challenge it will.

i'm looking at this from a pure business sense, not anything to do with the quality of their races/ag numbers.

what it does provide, is critical mass to challenge, who've been losing races to ITU, and the elss races they had the harder the fight against a roth takeover would be, which has to be the main itu goal.

peter kern

tunney wrote: »

Agree.

For all the talk about pros and prize money and pros this and pros that. no one really cares.

so are you saying that not having a pro prize purse worked very well for rev 3 ?
If that was the case why merge and go back to prize money ???

tunney

peter kern wrote: »

so are you saying that not having a pro prize purse worked very well for rev 3 ?
If that was the case why merge and go back to prize money ???

No, their model was based on "attract the pros and the plebs will come"

That didn't work.

Then they said "feck it fvck the pros and lets put on races and see what happens"

Yanks being simple though "but its not an IM, I cannot get a tattoo unless its an IM"

peter kern

becasue they did not get the pros. or the pros did not attract the agers ?

mossym

peter kern wrote: »

but i it could also mean that they realised that they are to small to survive in the market regardless of any business model. NO ?

isn't that still a flawed business model? your business model takes core competencies of your business, and delivers them to the market in a way that generates a multiplier of the costs. if generating the multiplier requires resources beyond the capability of the company, then the business model is wrong. if the product is not differentiated enough to survive in the face of competition, especially from competitors who have greater economies of scale, then it's a flawed business model. having a good product is only part of a successful business model. I've a tech background, so the examples i can think of are technology based, but loads of instances where the right product failed to inferior competition because the business model was all wrong

peter kern wrote: »

Also do you think that they would not have talked to each other before the prize money change and maybe wanted to test the water what happens if they change? Unless you are right and it was an SOS merger I would think it would take quite some time to find agreements study the market etc or not ?

or look at it another way, did bottom line revenue make them more attractive to a merger/acquisition? did paying out 100k in prize money but not attracting stars serve them better than saying look how much money we made from our last race if the 100k is now profit rather than an expense eating into profits?

if the merger was already agreed, and challenges plan is to pay big money, why would rev3 go the opposite direction and drop the prize money? one reason i can think of is that challenge didn't want their big prize money races diluted with others around the globe. (if this is the case it suggests challenge are the primary partner, and it's not a partnership but essentially a takeover)

peter kern wrote: »

I almost think its more that challenge with the Penticon fiasco and atlantic not going well realised their brand is too weak in the Us and they need somebody capable to run the Us part .

agreed, but that could still be as part of a takeover. plus rev3 is very popular in hte stated with ager's. nokia phones are still nokia phones even though they are microsoft, as microsoft know putting their name on it would have negative branding issues. Would rev3 races lose some of the shine they have if people thought they were now challenge races, a brand you already pointed out isn't well thought of in the states.


it's only an opinion, but this doesn't look a pure equal opportunities collaboration to me. Pity it didn't happen a couple of years ago, would have made an interesting case study for my mba

peter kern

isn't that still a flawed business model? your business model takes core competencies of your business, and delivers them to the market in a way that generates a multiplier of the costs. if generating the multiplier requires resources beyond the capability of the company, then the business model is wrong. if the product is not differentiated enough to survive in the face of competition, especially from competitors who have greater economies of scale, then it's a flawed business model. having a good product is only part of a successful business model. I've a tech background, so the examples i can think of are technology based, but loads of instances where the right product failed to inferior competition because the business model was all wrong

does challenge and rev think togheter they gain more critical mass to make the model working ?

Fazz

I think there's a few confusing points here that need clarifying.

- Rev3 events failed most likely due to offering prize money to attract pro's and thus entries but not covering these costs enough to warrant continuance

- Challenge races have been bought out by WTC in the past (not ITU as mentioned).

- Challenge has little to no PR/Name in North America

- Challenge has a good relationship with ITU/ETU as seen from them getting the ETU Middle and Long dist champs the last couple years.

- Challenge now partnering with Rev3 to increase their north american presence and grow their brand - but not sure the model of paying exact same prize money has been confirmed or has it?
I don't expect the same prize money levels to be in place until proven sufficient numbers?

- Challenge are offering the highest payout race in bahrain half ironman this year, attracting serious fields.



So the debate above moved into the will it work assuming same prize money model. I don't think this assumption is confirmed is it?

With their increased race presence, and high profile Bahrain race they are making strong moves this year to be more of an alternative option to the WTC IM brand.

So what's left for them to do?
They are missing a kona, but have Roth.

Missing a "World Championship and European Championship" race in both distances.

You'd imagine in order to sustain their ethos of a few big payout races a year, they need to go ahead and set up Champs Races which require qualification of some sort and thus compete on the highest level with WTC.
This would ensure athletes chose more than 1 Challenge race and aim to make it their main goals, thus increasing entry numbers,revenue,prize money pot etc.

Not what a lot of athletes race for, and this business is based on AG entry fees, but to increase their Brand and Competitiveness this is likely the road they need to go down.

And judging from this year, a road they are fast approaching.

There is one variable with the ETU/ITU relationship. At the moment whilst these are seen as good races, they are not as big or prestigious as the IM Euro Champs or World Champs.

I'd say most folk know the ironman world champs as Kona, the 70.3 world champs as rotating (prob say Vegas off the cuff).
Less may know the Ironman Euro champs as Frankfurt. And less the 70.3 euro champs as Wiesbaden.

But how many know the ETU middle distance champs at Challenge Mallorca in October?
Or Challenge Rimini next year?
Or ETU euro long dist champs in Challenge Almere next week? (Ironman distance).

Or the ITU world Long distance champs as China this year?
This is 4k, 120k, 30k btw.


Very very few i imagine.

It's possible Challenge and ETU/ITU could collaberate together as they grow and utilise these races as being the Champs races.

Roth is almost too big to be a champs race. But similarly would fit so well as direct competition to WTC and IM FF (WTC Euro Champs).


Challenge needs more loyalty from more athletes to grow.
Do they set up an alternative Champs series to do this?

I don't see any other option.
They must start with a live feed of Bahrain now to get a head start over the WTC screw up at MT 70.3 worlds.
That would put Bahrain front of mind for some, andnif it moved to be a middle dist world champs race may persuade some to chose it over IM brand.

peter kern

yes it has been confirmed that all rev races will have the usual challenge price money

Fazz

So should be successful like all other Challenge races as they seem to have a strong business model.
From memory the rev3 races paid out 150k or so and obv didn't generate the entries to cover this.
Challenge prize money seems to be within their budget and similar to ironman so should work.

Just a matter of building the brand and pr to tap into the faithful IM contingent.

I wonder if Abu Dhabi is a possible target too or a competitor.
Big prize money going strong for a few years now.

mossym

peter kern wrote: »

does challenge and rev think togheter they gain more critical mass to make the model working ?

the above is just my opinion peter, so can't comment on what they are thinking. but the model is already working for challenge. they had the kona ladies winner win roth this year, with a vow to be back next year. that's the sort of high elvel entry i think rev3 were missing. as fazz said big purse for their 70.3, looks like it will draw big names. don't the brownlees like racing out there?

so they(challenge) have it working already. now they "buy" a local operator who has races and apply the same experience. i don;t see challenge changing much based on this...

mossym

Fazz wrote: »

- Challenge races have been bought out by WTC in the past (not ITU as mentioned).

my bad fazz, mixed up my acronyms/organizations.