We had several fans tell us that they are sure Nike pays as much or more than Adidas. They also feel that if UCLA hired Nike, then Nike would promote UCLA more and therefore sell a lot more as well.
We will tackle the second point first. Adidas is not hired to “promote UCLA.” UCLA is responsible for that and they have outside firms they work with to help. Currently IMG represents UCLA athletics for licensing, media deals, and sponsorships, and before IMG, it was ISP Sports. Within the Athletic Department, there is also the Marketing and Business Development Office, run by Scott Mitchell. Schools do not go to the athletic apparel companies asking them to promote the school. The athletic apparel companies go to the schools and ask if they can pay the school to be the official provider of the teams athletic gear. With that they get merchandising rights and other opportunities to make money off the school brand.
When picking the company, most schools sell the whole package to the athletic apparel companies. So the school has to think about more than just the football team. They have to think about the basketball team, the baseball team, the track team etc…
As for Nike being better at promoting UCLA athletics, all you have to do is look across town at USC where many of their fans dislike Nike and USC itself seems to be trying to distance itself from the famous shoe company. You know what they say about the grass is always greener…
What will sell UCLA gear is UCLA winning and winning big. Period. If UCLA is not winning, neither Nike or anyone else is going to make UCLA gear look like a hot commodity.
Anyone think Nike can contract with, oh, say, Cal State Northridge (no offense to CSN fans or alums) and market them and make everyone in the country want one of their sweatshirts? The answer is no because it is not as simple as some want to believe it is. However, if Northridge started a D-1 football team, and ran off a couple national championships and a few Heismans like USC did a decade ago, Nike would look like brilliant marketers. Maybe it is that simple – winning cures all ills.
Another example is the University of Cincinnati in Ohio. A few years ago, they were a school that few out of the immediate area had ever heard of. Then Bob Huggins came along and took them deep into the NCAA basketball tournament. His days there with a successful basketball team completely changed the perception, image, and awareness of this regional school. Apparel sales went through the roof, student applications increased significantly, donors started coming out of the woodwork. This had little to do with an apparel company “marketing” the university, but it had EVERYTHING to do with winning.
You think Butler University is a household name with college basketball fans because of Nike? We don’t. We think it is because of several deep runs in March Madness.
Anyway, you can disagree with us, but at least you get where we are coming from.
As for Nike paying more, we found a source that compared all the athletic apparel contracts of public universities (private schools like USC don’t have to disclose this information). This is what they found for the PAC-12:
University of Oregon (NIKE U), 2013/14, $2.2 million in equipment, $600,000 in cash.
Oregon State University, Nike, 2013,14, $2.097 million in equipment, zero in cash.
Arizona State University, Nike, 2013/2014, $1.475 million in equipment, $350,000 in cash.
UC Berkeley, Nike, 2013/14, $1.8 million in equipment, $150,000 in cash.
University of Colorado, Nike, 2013/14 $1.565 million in equipment , $400,000 in cash.
University of Utah, Under Armour, 2013/2014, $1.816 million in equipment, $550,000 in cash.
University of Washington, Nike, 2013/2014, $2.6 million in equipment, $600,000 in cash.
Washington State University, Nike, 2013/2014 $1.2 million in equipment, $200,000 in cash.
UCLA, Adidas, 2013/14, $2 million in equipment, $3.5 million cash. Note that Adidas and UCLA list the equipment value as wholesale, and the retail value is $3.6 million. From our understanding, all the other schools on this list are stating the retail value of the equipment.
The UCLA contract is significantly better than any other PAC-12 public university. It is almost twice the next highest contract and surprisingly, even higher than “Nike U,” the University of Oregon (although we suspect there are major perks associated with the contract).
Stanford and USC do not have to release their contract details but based on the above, we would assume Stanford may be a little above the ASU range.
USC is trickier. USC left Nike to sign a 10 year marketing deal with Silver Star Merchandising, owned by Jerry Jones, owner of the Cowboys NFL team. That contract allows SSM to manufacture, license, and distribute all of USC’s athletic apparel. Nike will still be supplying on-field uniforms. So we really don’t know the extent of USC’s connection with Nike or how lucrative it is. We have to assume under the circumstances, USC believes it can do better than Nike.
Perhaps as USC’s on field success faded, so did Nike’s interest in how much it was willing to pay the Trojans, or to even market them.