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Cash Is King In Intercollegiate Apparel Agreements

By Jonathan A. Jensen & Tiyler Wisniewski

In an era when many states are actively choosing to reduce their support for higher education, cash is king.


From selling their own parking lots to outsourcing bookstore operations, public universities have been forced to get creative in order to generate much-needed funding to support continued operations.


From the athletic department perspective, while a handful of programs generate enough revenue to allocate surplus funds to the university at large (link), the vast majority are scrambling for ways to generate additional income to cover rising coach and administrator salaries, renovation and construction costs, and the myriad of other expenses incurred in the daily operation of a Division I athletic department.


The inaugural Intercollegiate Apparel Agreement Report from the Center for Research Intercollegiate Athletics (CRIA) at the University of North Carolina at Chapel Hill provides a detailed look into some trends regarding the revenue received from public Football Bowl Subdivision (FBS) institutions from apparel, licensing, and sponsorship agreements with Adidas, Nike, Russell Athletic, and Under Armour.


We thought it also might be interesting to take a deeper dive into the amounts of cash allocated as part of these agreements, including which institutions are receiving the most (as a percentage of the overall agreement), how the amount of cash allocated has evolved over the past five years, and which brands are allocating the largest percentage of their agreements in cash.


Table 1 includes a rundown of the amount of cash allocated during the 2017-18 academic year in each of the agreements included in CRIA’s database, ranked by the percentage of cash included. Of note is the fact that of the 85 agreements, 37 do not include any cash allocation whatsoever. Several Power Five institutions are included in this group, including Illinois, Florida, Minnesota, and Arizona.


The average amount of cash provided during the 2017-18 academic year to members of Power Five conferences was $1.3 million, or 30.8% of the total value of the agreements. For Group of Five institutions, the cash totals averaged only $86,500 (just 10.7% of the total). In fact, only eight of the 40 agreements with Group of Five institutions in the database include cash, led by the $1.42 million received by Connecticut.


However, a few of the largest agreements signed over the past two years include a considerable amount of cash, most notably Nike’s new agreements with Texas and Michigan, and Under Armour’s agreements with UCLA and Wisconsin. Though we do not include it in our year-over-year totals, Ohio State also received a $20 million “signing bonus” from Nike last year.


Which universities may be in line for similar paydays over the next year or two? Agreements between several large athletic departments and Nike are scheduled to end at the conclusion of the academic year next June, including North Carolina, Alabama, Oregon, UConn, Iowa, and Iowa State. Nebraska and Georgia Tech have already announced new agreements with Adidas. The agreement between Adidas and the University of Kansas and Nike’s with Mississippi, Washington, and Boise State end in 2019.


If history is any indication, institutions affiliated with Nike and Under Armour may be in for a larger payday. Figure 1 displays the trend in total cash allocations by each brand for the period of 2012-13 through the 2017-18 academic year.

Figure 1. Total amount of cash allocated by Adidas, Nike, and Under Armour since 2012-13


The figure displays a spike in cash allocated by both Nike and Under Armour since the 2015-16 academic year, attributable to the aforementioned new agreements with Texas, Michigan, Ohio State, UCLA, Wisconsin, and South Carolina. However, as evidenced by Figure 2, this trend is belied by the fact that across all of the agreements Nike has been the brand least likely to include a large percentage of cash, with the exception of elite programs such as Michigan, Ohio State, and Texas. It has been Adidas and Under Armour, in their quest to challenge Nike’s category dominance, which have been increasingly willing to provide institutions with a larger percentage of cash in the agreements.

Figure 2. % of cash allocated by Adidas, Nike, and Under Armour in apparel


When surveying this landscape, it is also important to consider challenges facing the apparel industry, including issues related to the current retail environment. In addition, now that Under Armour has successfully expanded their reach across the Midwest (with Notre Dame and Wisconsin), Southeast (Auburn and South Carolina), and West (UCLA and Cal-Berkeley), and taking into consideration its recent sales and stock slumps, it would not be surprising to see the brand pull back in this area and take a seat on the sidelines over the next couple of renewal cycles. With Under Armour’s impending on-field apparel agreement with Major League Baseball, it may also choose to re-focus in other areas of its business over the upcoming years.


On the other hand, given the influx of investment to support its marketing efforts in North America from its German headquarters and recent sales upswing, Adidas may be well-positioned to use the potential for large cash payments to pluck a handful of top programs from Nike over the next several years. The brand, which has traditionally targeted institutions that can help it make a splash in larger urban markets such as Houston, Kansas City, Louisville, Miami, and Phoenix, recently picked off Georgia Tech, an affiliation that will be utilized to supplement its digital and social media marketing efforts in the Atlanta market.


Regardless of whether these statements turn out to be prescient, institutions would be wise to leverage the level of competition between these brands and within the retail business environment to maximize cash allocations in future apparel agreements.


Jonathan A. Jensen, Ph.D. serves as an Assistant Professor at the University of North Carolina at Chapel Hill. Tyler Wisniewski is an undergraduate student in the university’s Sport Administration program.


Table 1. Percentage of cash allocated during 2017-18 academic year in FBS athletic apparel agreements


University Conference Cash % of Total Brand
Texas Big 12 $9,000,000 75.3% Nike
UCLA Pac-12 $9,000,000 54.5% Under Armour
Michigan Big Ten $4,820,000 49.0% Nike
Kentucky SEC $1,800,000 48.3% Nike
NC State ACC $1,950,000 46.99% Adidas
Wisconsin Big Ten $4,250,000 46.4% Under Armour
South Carolina SEC $2,600,000 38.8% Under Armour
Georgia Tech ACC $950,000 38.0% Russell Athletic
Maryland Big Ten $1,675,000 35.8% Under Armour
Auburn SEC $2,200,000 34.4% Under Armour
Florida State ACC $1,400,000 33.3% Nike
Connecticut AAC $1,425,000 31.5% Nike
Texas Tech Big 12 $800,000 30.2% Under Armour
Texas A&M SEC $1,850,000 27.2% Adidas
Oklahoma Big 12 $1,400,000 26.7% Nike
Kansas Big 12 $1,775,000 26.6% Adidas
Colorado Pac-12 $750,000 26.3% Nike
Tennessee SEC $1,000,000 25.6% Nike
Georgia SEC $1,000,000 25.6% Nike
Indiana Big Ten $1,425,000 25.1% Adidas
Cincinnati AAC $1,165,000 24.5% Under Armour
Washington Pac-12 $925,000 24.1% Nike
Nebraska Big Ten $1,000,000 23.9% Adidas
Ohio State Big Ten $1,488,000 23.6% Nike
LSU SEC $1,000,000 23.3% Nike
South Florida AAC $725,000 22.8% Under Armour
West Virginia Big 12 $750,000 22.4% Nike
Michigan State Big Ten $900,000 22.2% Nike
Oregon Pac-12 $610,000 21.7% Nike
Louisville ACC $1,555,000 21.3% Adidas
Alabama SEC $780,000 20.1% Nike
Iowa Big Ten $350,000 17.9% Nike
Purdue Big Ten $350,000 17.1% Nike
Oklahoma State Big 12 $750,000 16.3% Nike
Virginia ACC $500,000 16.3% Nike
Virginia Tech ACC $275,000 14.5% Nike
North Carolina ACC $475,000 12.3% Nike
Washington State Pac-12 $200,000 9.1% Nike
Oregon State Pac-12 $225,000 7.4% Nike
Rutgers Big Ten $100,000 5.7% Nike
Missouri SEC $150,000 4.8% Nike
UAB C-USA $50,000 4.5% Under Armour
Fresno State MWC $25,000 4.3% Nike
Clemson ACC $115,000 4.1% Nike
Boise State MWC $50,000 3.9% Nike
MTSU C-USA $5,000 3.5% Nike
Iowa State Big 12 $15,000 3.1% Nike
UNLV MWC $15,000 1.5% Nike
Illinois Big Ten None N/A Nike
Florida SEC None N/A Nike
Minnesota Big Ten None N/A Nike
Arizona Pac-12 None N/A Nike
Mississippi SEC None N/A Nike
Hawaii Big West None N/A Under Armour
Memphis AAC None N/A Nike
East Carolina AAC None N/A Adidas
Houston AAC None N/A Nike
New Mexico MWC None N/A Nike
San Jose State MWC None N/A Adidas
Ohio University MAC None N/A Adidas
Arkansas State Sun Belt None N/A Adidas
Western Kentucky C-USA None N/A Russell Athletic
Louisiana Tech C-USA None N/A Adidas
Nevada MWC None N/A Nike
Utah State MWC None N/A Nike
FIU C-USA None N/A Adidas
Kent State MAC None N/A Under Armour
New Mexico State WAC None N/A Under Armour
Old Dominion C-USA None N/A Under Armour
FAU C-USA None N/A Adidas
UTSA C-USA None N/A Adidas
Miami (OH) MAC None N/A Adidas
Marshall C-USA None N/A Nike
Western Michigan MAC None N/A Adidas
Appalachian State Sun Belt None N/A Nike
Northern Illinois MAC None N/A Adidas
Eastern Michigan MAC None N/A Adidas
Central Michigan MAC None N/A Adidas
Bowling Green MAC None N/A Nike
Ball State MAC None N/A Nike
Akron MAC None N/A Adidas
Idaho Sun Belt None N/A Nike
Texas State Sun Belt None N/A Adidas
South Alabama Sun Belt None N/A Nike
Louisiana-Monroe Sun Belt None N/A Adidas