Rethinking College Sports Sponsorships

To quote Aaron Sorkin, via Sam Seaborn during the first season of the West Wing, “Education is the silver bullet. Education is everything. We don't need little changes, we need gigantic, monumental changes. Schools should be palaces. The competition for the best teachers should be fierce. They should be making six-figure salaries. Schools should be incredibly expensive for government and absolutely free of charge to its citizens, just like national defense.”

Well, this is not the case.  And college education can be expensive, cost prohibitive to some. Yet I firmly believe that education is the panacea for any number of our collective societal issues. Having access to an affordable education is instrumental in preparing the next generation to lead and affect change.  Therefore, preserving opportunities for college scholarships is a fundamental part of these future leaders having a path to achieve success.  Further, creating dynamic, substantive, educational experiences which both integrate multiple disciplines and also reflect the world beyond the classroom will create the leaders and change agents so desperately needed.

Rethinking the approach to sponsorships and partnerships in the collegiate athletic space can both shore up the financial foundation for sustaining student-athlete scholarship in the 24 NCAA sports and also create some of those dynamic academic opportunities for the greater university community.

Why would anyone do this, you may be thinking… it seems complicated, and for what return? Well, for starters, as I mentioned above, preserving scholarships and offering educational opportunities to young people is incredibly important to the future leadership of America.  According to the NCAA, Division I & II schools provide more than $2.7 billion in scholarships to over 150,000 students annually.  Since more than 96% of all college student-athletes will “go pro” in something other than their sport, graduating with no or low student loan debt is an incredible advantage when embarking on a career.  Unless the athletic departments at a whole lot of colleges and universities can improve their departmental balance sheets, opportunities to attend a college or university on an athletic scholarship are going to decrease as sports teams get cut, meaning opportunities to attend college on scholarship will decrease.

It is no secret that despite the legions of loyal fans, the celebrated mega-dollar TV rights deals for the power conferences, and full arenas and stadia for rivalry games and marquee events in football and basketball, fewer than 10% of NCAA Division I and II athletic departments operate in the black.  According to an NCAA report, only 24 programs (all DI) at the more than 325 DI and DII colleges and universities across the United States made a profit in the 2014-15 academic year.  The rest “lost” money, to the tune of a cumulative $2 billion.

Of course there are very few departments of, say, mathematics or art history that generate more revenue for their universities than what it costs to run them.  However, perhaps because the academic departments are largely focused on the core missions of institutes of higher education, which encompass the education of students, the dissemination of knowledge, and perhaps the expansion of the body of knowledge through research, they do not come under the scrutiny that departments of athletics do for the fact that their budgets operate at a deficit.

When you couple the deficit spending with the emerging trend that finds athletic departments shifting their operational ethos to one aligned more with corporate entities than one strictly in the traditional educational vein, the scrutiny increases further.  Some of these have been successful transitions such as Arizona State and Notre Dame, others are works in progress like Michigan, and still others are too soon to tell, as in the case of Syracuse, where alumnus John Wildhack is beginning his first year in the AD’s office after a long and successful tenure at ESPN.  While this trend may appear to further separate the athletics departments from the core mission of the university, that is not, nor should it be, a necessary outcome.

The reality is, the most successful transformations will come within those athletic departments which balance leveraging their assets with driving the academic pursuits of the university.  So how does this happen? First, by modernizing marketing partnerships and approaching them in the same fashion the rest of the (for-profit) world does, so that in just a few cycles they can significantly offset their high operational costs, and simultaneously deliver tangible and meaningful academic opportunities to the university community.

Second, the silos must be dismantled.  The athletics department leadership should examine all sponsorship and partnership opportunities through the filter of, “how can this mutually benefit our athletics program and advance the academic mission of the university?”  Because the athletics department would become integrated with the other academic departments beyond the few traditional relationships (such as journalism and broadcast media, and physical/occupational therapy).

To make this philosophical and functional shift, athletic departments need to look practically at packaging and leveraging their various assets with those from other parts of the university community that would appeal to sponsors. Then it becomes like any other successful marketing partnership or joint venture, where each party has something of value to exchange with the other.  For example:

·       Partner with a company to invest in cross-functional facilities on campus, not exclusive to the Athletic Department.  For example, the “Brand Z Performance Institute” would be used for research by life science majors in addition to student-athletes, with the research results benefitting multiple constituencies on campus. Further, Brand Z would have a collaborative relationship with the institution to conduct for-credit student research projects.

·       On the business and operations front, a company specializing in ticketing and POS systems can much more easily beta test and debug a system in a college environment than in, say, an NFL building. It’s the same for indoor arena systems, be it POS, fan behavior tracking, LED technology, etc.  These partnerships can allow for upgraded systems at reduced cost to the institution while the vendor benefits from real world, real time testing of next generation technology.

·       The vast tapestry that is college sports is ideal for interactive marketing collaborations such as the one between Pepsi and Lightwave at SXSW2014. A conference championship or rivalry game is fertile ground for a multi-faceted project among a university’s sociology, life science, computer science/technology, marketing, and athletics departments.

·       There are countless opportunities to leverage value-in-kind partnerships to offset operational costs.  This works well for partners like hotel chains and apparel or equipment manufacturers which can account for large portions of the departmental budget.  For example, an academic institution with a robust sustainable energy program might enter into a research project agreement with a hotel chain to find ways to lower their carbon footprint and offset energy consumption at their properties in exchange for a given number of room nights or preferred rate for the entire academic year. 

Because there can be more red tape on college campuses than even in government administration, what would it take to make these interdepartmental collaborations work smoothly? 

·       Step one is to create a Graduate Assistant position to manage these arrangements, ideally through the business school.  A candidate with collegiate athletics experience and an affinity for logistics is going to rise to the top of the pool. 

·       Step two is to comb through the current institutional policy on Sponsored Research Projects to ensure that everything that each party wants to accomplish is possible. If not, the GA needs to work quickly with the administration to make it happen. (If there is no official institutional policy, a great place to start is the bipartisan Report on University-Private Sector Research issued in 2008 by the President’s Council of Advisors on Science and Technology.  And a fantastic example of an individual institutional policy on sponsored research is the University of Pennsylvania’s.)

·       Step three is to get the project and the timeline approved by all parties and assign an agreed-upon project manager.  The role of the project manager is to ensure that the business interests of the partner are not in jeopardy, NCAA rules and regulations are not violated, and institutional academic rules and standards are simultaneously upheld.

While there will no doubt be some barriers to implementation and success of this progressive strategic approach, not the least of which is getting a third-party multi-media rights holder to understand the necessity of value-in-kind options, none would be insurmountable.  Converting the tremendous number of marketing and advertising assets and opportunities available throughout the athletics department into 360o experiences for both students and corporate partners will be integral to maximizing the value of the department of athletics to the university.

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