What corporate innovation strategies did Vince McMahon use to grow World Wrestling Entertainment?

World Wrestling Entertainment (WWE) announced on January 27, 2015, that its WWE Network, which had been launched just 11 months earlier, had surpassed one million subscribers, making it the fasting-growing digital subscription service. Vince McMahon had taken over a small wrestling business from his father and built it into a large national business. For years, the firm managed to show consistent growth by attracting more and more fans. In an effort to diversify, in 1999, shortly after going public, WWE launched a eight-team football league called the XFL. Unfortunately, the football venture did not prove successful and resulted in a $57 million loss for WWE. Subsequently, WWE had struggled with its efforts to build new wrestling stars; the attendance at its live shows began to drop off, and advertising revenues declined as well. In part, this may have resulted from a saturation of the market for wrestling, but the lackluster financial results might also have been attributed to the failure of WWE’s efforts to diversify away from wrestling.

In the years since that misstep, CEO Vince McMahon explored new avenues of growth and turned pro wrestling into a perpetual traveling road show. WWE used wrestling’s increased popularity to build up a stronger ad-supported Internet presence, where content can be watched 24/7, and the firm even expanded into feature film production with its wrestling superstars. During 2015 WWE celebrated the popularity of its YouTube channel success, attracting over one million subscribers to its original WWE Network programming. The firm also staged over 330 live events a year, and by 2014 had produced almost 70 live shows outside the United States, helping to boost the worldwide revenues that the firm was able to generate from its merchandise. In addition, an exclusive multiyear agreement with Hulu Plus brought WWE programming to video streaming users, and mobile apps for smartphones and tablets had taken off, with the WWE Active being downloaded 3.5 million times since its launch in 2012.

Regarding competition, the firm has had to face a challenge from mixed martial arts (MMA), a growing form of combat sport that combines kickboxing and grappling. Because of its similarity to wrestling, this new sport might pull away some of WWE’s fans. The question remained: could WWE identify opportunities for further diversification and expansion to maintain its current success?