This is my first post on these boards so I might get flamed to hell and back, especially since my post tends to be on the positive side of the average on these boards, but after having lurked on these boards for over a year now, and being a total pool junkie that is highly interested in the outcome of the IPT business venture, I thought I’d jump in with my 2 cents.
I do not view the IPT as a scam nor can I given what I currently know nor do I view it as a failed business venture, YET. I think it’s better to classify the IPT as a fledgling business venture that is struggling to monetize it’s business plan. I think it’s still a business venture in progress and still has a chance to succeed. I think that KT had multiple ideas for this business and is trying to get one or more of those ideas to bear fruit and provide a positive cash flow. Unfortunately, there aren’t enough fans yet to make those ideas profitable.
1st I think that KT thought that if the IPT took off like poker has, he would get so much branding for his Natural Cures business, that he wouldn’t necessarily need to bring in any other advertisers at all. Whether or not the IPT made money as it’s own business entity, would be offset by the fact that he would have reached a whole new demographic for his Natural Cures business which would then be booming. In a way this would be good for him, because he could write off any losses with the IPT against his gains with Natural Cures creating a highly beneficial synergistic effect with the two businesses. I see that as a clever business idea that probably hasn’t paid off yet.
2nd I suspect that he thought he could add to his IPT income by also working with premier national advertisers while maintaining Natural Cures as the primary “sponsor” of the tour. That way, without taking away from his first idea, he’s able to make extra money. As a partner myself in an advertising related company, I’ve been impressed by his ability to land a couple of national advertisers already, Party Poker and Vonage come to mind, especially since those advertisers are getting very few eyes to actually see their products. It may be that they tried a small “Test Campaign” with the IPT to see if they received any benefit from their advertising. I doubt they did because I doubt they’ve been able to reach more than 10k or 20k people with these dollars and those are very low numbers of people to reach for national advertising. Of course, this might be lucrative already as I’m just speculating on numbers here and could be way off how much money the IPT received from these advertisers and the results of these advertising campaigns with the IPT.
3rd The IPT has created or is affiliated with quite a few high quality products that they should be very proud to have produced or worked out a relationship with a quality company. As pool people know, the Diamond tables are some of the best in the world and even the Sardo rack is what it is and serves it’s function well after you take the time to “train” the tables etc., they really do give good racks which is great for a high level pro tournament even if it isn’t all that practical for a pool hall or home use. The online streams and videos are both high quality, have great commentary, and growing in volume on their site. The events themselves have been first class. I was at the King of the Hill for everything but the final match, 12 hours a day with VIP seats and the production and the quality of pool in addition to being able to interact so directly with some of the best players in the world was amazing. My fiancé and I have even bought rooms at the Wynn already for this years KOTH which I fully expect/hope to happen. If they could only get people in the stands to watch these events, anyone that is remotely interested in competition or pool would love the experience. I assume that KT expected the stream of income coming from all of these different products to be higher than what he’s seen so far.
4th. While the qualifiers are not “income stream” in the strictest sense, as most of us know that pyramid shaped businesses don’t make it very far, it’s certainly a good idea and can help offset some of the expenses of running the other facets of the business. I don’t think he’s taking advantage of anyone here and I think he’s pretty close to the mark on pricing in that he wants to limit the participation to those people that are truly serious about playing on the tour or in these tournaments which also has the secondary benefit of keeping these tournaments from becoming unmanageable due to having too many entries.
5th I can imagine that KT also had/has plans to promote the players in the IPT as best he can and possibly make a little money as the promoter of these players as well. This hasn’t happened yet for a variety of reasons but I think it ultimately comes down to a lack of interest from a truly large mass of the US, European, or Asian public. If “no one” knows who they are, they have no value to him from this perspective or to an advertiser so a critical mass of people must be reached to make this viable.
6th. I’m sure that KT and the IPT staff have plenty of other ideas of which we haven’t seen yet to further monetize their current streams of income and to add new streams as well. Only time will tell what those will be.
I think that by offering huge prize payouts, KT thought he could reach or create a large mass of IPT fans through a viral marketing effect that resulted from the glamour of these payouts, similar to what happened for poker. That way, he didn’t have to have a marketing budget because he could pay the pool players good money and pay for his marketing all in one. While I think that poker and pool have a few things in common, I think there’s one fundamental difference, which is prohibitive to thinking of them as similar opportunities from a business/fan standpoint. In poker, a “fan” of poker or relative newby can get involved if they have enough money, and actually have a chance, though maybe a losing chance, but a chance to win in the short run against the pro poker players, while a beginner pool player or fan wouldn’t have a chance in hell winning against a pro pool player. Because of this, I think poker has a lot more attention from the arm chair warrior who says to himself, I can do that too, and then goes and plays with his buddies or enters some tournament in Vegas and gets lucky and then in turn, watches the World Poker Tour or the WSOP on TV every week.
I think ultimately, that’s where the roadblock has been for this business so far, there simply aren’t enough fans to provide significant income for the multiple income streams that the IPT has created. Without a critical mass, it cannot be a cash positive business, and the state of pool before the IPT came about, is a direct example of what is possible with the small group of hardcore, US pool fans. Not that these fans are doing anything wrong, I’m one of them myself, but there simply aren’t enough of us to provide an interesting demographic for advertisers to reach out to and without the advertisers money, or without a huge mass of fans far beyond the current total buying the products that the IPT has produced, the current business model with huge payouts isn’t going to work. I myself tried to spread the word about the IPT to my recreational or non pool playing friends after I attended the KOTH so that they could enjoy the sport at it’s best (and so they could see me on TV in the stands). Unfortunately, I don’t know how many of them, if any are still watching those programs and I don’t know if there are enough hardcore fans to provide a viral marketing effect for the tour. There is a possibility that if the IPT can reach all of the hardcore pool fans across the world, Europe, Asia, and wherever else pool is played, even if the general masses don’t support it, there might be enough people to support a less lucrative IPT that can still provide a healthy income for the top 150 players in the world. Either way, in my opinion, the IPT needs to seriously ramp up their marketing campaign in order to reach the general masses or to insure that they reach the hardcore fans across the world and hopefully, now that they have good products available for viewing on TV and their site, they will do just that.
I have so many more things to say having lurked on these boards for so long and have read so many threads about this subject, but I can tell this post is far beyond long already so I’ll draw to a close.
In closing, I’ll say that I’ve enjoyed these boards immensely for quite some time and have really enjoyed reading so many posts from people that are incredibly knowledgeable about pool and offer great insight into the current state our great sport finds itself in. To all the current IPT members and any of the qualifiers who played in the Reno tournament, I hope you all get your checks soon! To anyone on the IPT staff, if they read this stuff, I think in general you’re on the right track and have some awesome products, I just hope that you can reach the general masses or a big enough group of hard core fans to enjoy those products and provide the income needed to make the IPT, the IPT players, and everyone else involved lots of money in the future. Pool and billiards needs a pro tour like this to bring the sport to the masses and get the credit the sport and the hard working pro pool players truly deserve.
