When it comes to the value of apparel/equipment deals for major college athletic departments, brand power means everything.
University of Colorado Nike Partnership Extended
The value of the Buffaloes‘ deal with Nike is a strong indicator that just being part of a Power 5 conference is no guarantee of a tremendous haul in apparel revenue. Colorado Athletic Director Rick George stated that the value of the 10-year extension amounts to around $30 million.
That’s total value, not an annual estimate. Meanwhile, other members of the Pac-12 are reaping huge revenues from their apparel deals.
Other Recent Deals
Just two months ago, Under Armour and UCLA broke the previous record for apparel contract value. The 15-year contract will give UCLA a total of $280 million worth of cash and merchandise, over nine times the value of Colorado’s contract with Nike. It almost seems out of place to consider that both of these institutions are part of the same conference.
Brand Power
That’s where brand power comes in to play. These programs are compensated based on the value of the exposure for the provider. Additionally, projected sales based on past performance influences the value tremendously. The questions that the apparel companies have to ask themselves are how much money will it take to win the bidding war and how much of an investment are we confident of a solid return upon?
To a certain degree, these programs are compensated based upon what they have achieved in the past, not necessarily upon their current or future on-court/on-field success. There was no John Wooden at Colorado, and thus the Buffaloes’ brand never reached that level of austerity.
While Colorado may never have the brand power of other Pac-12 schools, its presence in the conference means that high-profile apparel companies like Nike will always have a place for the Buffaloes.
Improving the results on the court/field will go a long way toward enriching the next apparel deal. The more important determining factor, however, will be how much University of Colorado Nike gear flies off the racks over the next decade.
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