Positioning for the Coming NIL Chaos

TLDR NIL is coming. In some form. Schools (and states) are rapidly positioning themselves to be attractive locations for student-athletes. Georgia can’t avoid trouble. College sports marketing is going to a lot of fun to watch next year. Listen to our NIL discussion on Apple Podcasts, Spotify, and Stitcher. Name, Image, and Likeness is creeping back into the news. The NCAA had been scheduled to vote on proposed regulations in January, but the measure was pulled. It was pretty apparent that the NCAA was hoping for legislative action that would settle the issue. It was a misguided hope. The new administration and Democratic majorities are focused on other issues – COVID relief, a new definition of infrastructure, and creating national-level voting rules to name a few. As the Democrats maneuver to impose a hard-core progressive agenda and rebalance the electoral system, creating rules for the next Justin Fields and Trevor Lawrence to do sponsorship deals has taken a back seat. But, NIL will happen as multiple states have passed legislation that allows NIL starting this Fall. Colleges have already started to move. UCF allowed players a little personal branding opportunity by letting players use Instagram handles rather than names on their spring game jerseys. “If you really look at it, we’ve got 322,000 living alumni, and the average age is 36. They are all on social media. We got 72,000 students all on social media,” said Malzahn, “and this is the new age of personal branding and we are going to embrace it within the NCAA rules. That is who we are and that is who we are going to be.” Alabama, the state and the school, are moving aggressively to meet the future. Governor Kay Ivey signed legislation in April to make Alabama the 10th state to enact NIL legislation for student-athletes. Right on schedule, the University of Alabama announced a program to assist student-athletes with personal branding: Alabama announced Tuesday that it has created a program called The Advantage, which will assist and educate Crimson Tide student-athletes with the tools necessary to build and elevate their personal brands. The program, which will combine on-campus resources with external organizations, will focus on the management of each individual brand, maximizing personal social media platforms and education on financial literacy. The details about how NIL will be implemented are murky, but the direction of the institutional responses is apparent. Schools will rapidly build structures and capabilities to assist with athlete brand development. Personal branding plans will become a standard feature in recruiting pitches. Athletic departments and student-athletes are about to become even more high profile. It’s going to be high-intensity marketing in local markets and across social media. A lot of it will be a waste of time and money, but it’s going to be fascinating to watch. It’s going to be the Roaring 20s in college football. Former Georgia and Miami head coach Mark Richt described the monumental shift. “When I was playing college football, my priorities were girls, football and then school,” Richt said. “Now it’s going to be money, girls, football, school.” It’s actually going to be “marketing, sometimes money, girls, football, and school.” I’m guessing that there is less money out there than being predicted. And there will be a lot of folk chasing it. The market is about to be flooded by college athletes with social media audiences primarily made up of their school’s fans. Are IG and Twitter the best places to target alumni? Social media influencers often have some form of credibility in some product class. An all-conference linebacker might have fans, but will he move product? Influencer effectiveness is difficult to measure. With most of these athletes, marketing investments will be based on faith. It will be fun to watch. The schools have every incentive to make this work. If a school’s previous starting safety was making $150k per year, then it should be easy to convince the next 4-star prospect to sign on. Marketing plans will be a standard part of recruiting. Case in point, the state of Georgia recently entered the discussion. The Governor stated: “Thanks to [the bill], student athletes from across the country will have Georgia on their mind when they’re looking for a campus and a university that can give them a world-class education but also the chance to compete at the highest levels of college athletics.” Again, all the NIL moves by the schools and the states seem to be about gaining a recruiting advantage. But, since it’s Georgia, there needs to be something to attract national attention. However, the new legislation contains a twist. Schools can require athletes to pool up to 74.99% of their money earned in an escrow account that would then be shared with other athletes. However, it would not be able to be withdrawn until a year after they graduate/leave school. The Republican Governor advocating for some socialism that might help the Dawgs?. This rule would allow the school to share the riches with the backups and the softball team. There is an economic logic to sharing NIL revenues in that athlete’s NIL results are going to be driven by the school. But this does seem at odds with the spirit of letting athletes benefit from their own work product. So lots of movement and positioning for Fall 2021. The NCAA is now on the clock with state legislation about to kick in. The president of the NCAA has renewed the push for the acceptance of last Fall’s proposal: Emmert told The New York Times on Friday that he's pushing for approval of NIL guidance "before, or as close to, July 1." That date coincides with when new laws in Alabama, Florida, Georgia, Mississippi and New Mexico are set to take effect that will allow NCAA athletes to in some way profit off their name, image or likeness for the first time. Arizona has a law that will go into practice on July 23. Another half dozen states have laws that will open similar opportunities starting as early as 2022. I assume that the NCAA will pass the proposal. And then immediately start revising. A glorious sports marketing mess awaits. And, the new transfer rules promise to magnify the chaos. Also streaming on Apple Podcasts, Spotify, and Stitcher.

Positioning for the Coming NIL Chaos