Nike the big dog on UGA campus
By CARTER STRICKLAND
The Atlanta Journal-Constitution
Published on: 09/17/06
Athens — Being new to Bulldog Nation, Matthew Stafford wasn't braced for the reaction when he sauntered onto the University of Georgia practice fields a few weeks ago dressed in an offensive T-shirt.
Go Gators? I Love Spurrier? Nope, it was even worse.
"He's got on Reebok," Mark Richt yelled to the other Georgia football coaches, before sending his star freshman back to the locker room for a change of clothes.
UGA is a Nike school. The Beaverton, Ore.-based athletic apparel giant gives the university about $900,000 worth of gear a year for the right to be the official outfitter of the Bulldogs, under a 10-year, $13 million contract signed in 1999. It's the biggest deal among Georgia schools.
In addition, Richt's new contract, agreed to in July, calls for $530,000 a year for the coach's "equipment endorsement efforts," including Nike. The money does not come directly from the shoe company; UGA pays Richt. Such compensation has become a standard provision in high-profile coaches' contracts during the past 10 years.
Nike also writes Georgia an annual check for $400,000 as part of its contract with the university. The money goes straight to the athletics department.
In return for what it shells out to UGA, Nike expects its famous "swoosh" to be worn by players and coaches during "practices, games, exhibitions, clinics, sports camps and other official or university-sanctioned intercollegiate athletic program activities ... including but not limited to photo sessions and interviews," according to the 28-page, detail-laden contract.
Because the deal was signed so long ago, Georgia's contract with Nike is on the low end nationally.
The University of Texas, Florida State and Colorado all have Nike deals that pay substantially more money. Earlier this month, Nike came to terms with Kansas State, an athletics department that generates significantly lower apparel royalties than Georgia, for $12.3 million over five years.
Nike isn't the only company on college campuses. Competitor Adidas counts Notre Dame as a client. Under Armour recently struck a five-year, $10.6 million deal to be the official outfitter of the Auburn Tigers.
But when it comes to college sports marketing deals, everyone is chasing the "swoosh."
"Nike is the big dog," said Don Hinchey, vice president of the Bonham Group, a Denver-based sports and entertainment marketing firm. "Everybody else is just nipping at their heels."
Nike is behind what's believed to be the largest deal out there — a seven-year, $25 million agreement it signed with the University of Michigan in 2001, after a months-long spat between company and school officials.
"Nike has control of the market," said second-year UGA athletics director Damon Evans said. "When you look at them and look at their product, you understand why. It is what our players want to be in."
The swoosh is everywhere
Colleges say the deals allow them to put their players in high-end gear without breaking the bank. But some critics question whether the arrangements pressure campus athletics departments to operate like for-profit teams.
"Colleges and universities are slaves to it, and without it they can't keep up in the arms race," said Bruce B. Svare, director of the National Institute for Sports Reform at the State University of New York at Albany. "Eventually, it is going to come back and bite the NCAA and its member institutions."
Svare's concern is that universities are becoming increasingly commercialized as they try to make more money.
UGA President Michael Adams said he fought the issue of allowing athletic apparel logos on jerseys, telling then-NCAA President Cedric Dempsey as much in a letter several years ago.
Adams' main point: "Students shouldn't be billboards."
"I lost that battle," said Adams, who earlier this year wrote a column for the NCAA News suggesting guidelines for commercialism in college sports. "Now, [putting manufacturers' logos on jerseys] is fairly common, but we are discreet about it [at Georgia]."
Evans said UGA's relationship with Nike has nothing to do with keeping up with other colleges. UGA isn't hurting for money, he pointed out. The athletics department cleared $23.9 million in fiscal 2005 from ticket sales, donations, television appearances and more. That was the largest of any college athletics department in the nation, according to U.S. Department of Education figures.
Georgia's athletic budget for 2006-07 is $63.39 million.
"In the whole scheme of things, [the Nike money] is a relatively minor amount of our athletic budget," Adams said. "It is not enough to buy us or influence us."
Nike officials wouldn't discuss the ins and outs of their deals, only saying they're pleased to be in business with teams like UGA.
"Nike is honored to be the athletic footwear, apparel and equipment supplier of choice for the Bulldogs," said Kit Morris, Nike's director of college sports marketing. "And we look forward to working with the university for years to come."
Nike has a presence outside Athens, too.
Georgia Tech does business with the company, but its primary apparel outfitter is Russell Athletic, an Atlanta company. Unlike UGA, Tech has separate Nike deals for football, men's basketball and women's basketball. They range in length from two to four years and total about $325,000, Tech athletics director Dan Radakovich said.
But at UGA, the swoosh is splashed everywhere, from players' pant legs to the footballs the Bulldogs use in games.
So what exactly does it mean to be a Nike school?
For football players, Nike provides all kinds of cool stuff. Each gets a goodie bag of gear many players couldn't afford otherwise.
They can choose from one of six cleat styles. They also get high-end running shoes, a sweat suit, gloves, wristbands, socks, shorts. And more.
Add it all up, and Nike ships Georgia $268,550 worth of football products alone each year. Other athletic programs also benefit.
Women's basketball gets $144,315 in gear. Men's basketball gets $143,415, and baseball $38,504.
"You get this big stack of stuff at the beginning, and it's like, 'Whoa,' " said Bulldogs junior Kelin Johnson, thinking back to his days at Mainland High in Daytona Beach, Fla., where the equipment was "dirty, wasn't yours. Your parents had to get you things.
"You get here, and there it all is," Johnson said.
For big-name football coaches, it means that hefty boost in compensation. Texas' Mack Brown gets even more than Richt. His compensation for "athletic products and endorsement" is $580,000 a year. South Carolina's Steve Spurrier is due no less than $500,000 annually, according to his contract.
And coaches get the goodies, too. Richt may receive up to $3,600 in Nike shoes, apparel or equipment each calendar year, according to his contract.
Svare, director of the sports reform institute, said the deals between apparel companies and coaches are especially troubling. He worries that coaches will put their relationships with the companies that write the checks over the well-being of their athletes.
"They [coaches] get the endorsement money in order to promote the product," Svare said. "How can ethics not be compromised? How can clear independent, objective decisions ever be made in that culture?"
Bernie Machen, president of the University of Florida, another Nike school, said, "Yes, there is a lot of money involved, but I don't see any evidence of 'compromise.' "
"There are other sources of money and influence that are more problematic than the shoe companies," Machen said.
"TV and boosters," Machen said.
Exposure adds up
So what is in all this for Nike?
Well, mainly exposure. Take January's Nokia Sugar Bowl, played at the Georgia Dome. On one side: Georgia. On the other: West Virginia, another Nike school.
The product placement, on the front of every jersey and the side of every shoe — the swoosh displayed prominently in countless video replays and newspaper and magazine photographs — more than pays for Nike's nominal investment, according to Joyce Julius and Associates, which documents in-broadcast television exposure for products.
During the Sugar Bowl, the Nike logo had 21 minutes, 26 seconds of on-screen time, said Eric Wright, vice president for research and development for Joyce Julius. That's equal to $22.5 million of comparable exposure value, he said.
College football's national championship game — a one-for-the-ages Rose Bowl showdown between two Nike schools, Southern Cal and Texas — garnered the company $31.9 million of comparable exposure value.
"As you can see, they obviously know what they are doing," Wright said.
It's been this way since the mid-1990s, when Nike, taking a hint from what was happening with corporate branding in NASCAR, aligned itself with top teams.
Players have to wear gear
Svare, of the sports reform institute, said, "There is so much money involved and so much compromise that it is preposterous that we call this 'amateur athletics.' Increasingly, these sports apparel companies are calling the shots."
In April 2000, Nike stopped negotiations on contract renewal with the University of Michigan. At the time, university President Lee Bollinger accused Nike of retaliating against Michigan for its involvement with the Worker Rights Consortium, a student-driven coalition that demanded Nike improve conditions for overseas workers.
Nine months later, the company and university signed the $25 million deal, which was more than double the original contract agreed to in 1994. Some students were furious.
Thomas, the UGA associate athletics director, said the reality is that if colleges aren't given the gear by apparel companies, they purchase it — and it still comes from the same place.
"What I tell people all the time is, 'You are going to have to buy it somewhere,' " Thomas said. "If you don't get it from Nike, you are going to have to go to the store and buy it. And guess what? That logo is still going to be on there."