How NIL Policies Are Transforming College Athletics and Branding Opportunities


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Unlocking New Revenue Streams and Marketing Channels 

As universities everywhere wrap up this school year, they're looking ahead to an entirely new athletic program of possibilities next fall. As you may know, it is illegal for universities to pay college athletes to attend their school, and institutions that have crossed the line can face massive financial penalties and severe sanctions. However, all of that is changing...

The recent introduction of Name, Image, and Likeness (NIL) policies allows student-athletes to monetize their personal brands through various endorsements, sponsorships, social media, appearances, and other commercial opportunities, revolutionizing college athletics and providing brands with unique marketing channels. In this article, Hollywood Branded explores the impact of NIL policies on college athletics and the new opportunities they create for brands.

How NIL Policies Are Transforming College Athletics and Branding Opportunities

The SMU Case and Its Legacy

In the mid-1980s, Southern Methodist University's (SMU) football program was found to have engaged in numerous violations, including maintaining a "slush fund" to pay players. The NCAA responded by imposing the "Death Penalty" on the program, shutting it down for the 1987 season and heavily restricting it in subsequent years.

This punishment had long-lasting repercussions, severely damaging the program and setting a precedent for NCAA enforcement of amateurism rules. Growing up in Dallas's Highland Park community, I saw firsthand the impact of the NCAA's "Death Penalty" on both the students and community fans supporting SMU. The SMU case highlighted the NCAA's rigorous enforcement policies and strict adherence to amateurism, which prohibited any form of direct payment to athletes. This case became a symbol of the NCAA's hardline stance, influencing the organization's legal and regulatory approach for years to come.

Why the "Death Penalty" Hurt SMU

  • Program Suspension: The "Death Penalty" meant that SMU's football program was completely suspended for the 1987 season, halting the team's momentum and operations.
  • Loss of Scholarships: The NCAA drastically reduced the number of scholarships SMU could offer, severely impacting the team's competitiveness.
  • Ban on Postseason Play: SMU was banned from postseason games, diminishing the program's appeal to potential recruits.
  • Reputation Damage: The scandal tarnished SMU's reputation academically and socially, leading to a loss of prestige.
  • Financial Impact: The suspension led to significant financial losses from ticket sales, merchandise, and alumni donations.
  • Recruitment Challenges: Severe restrictions and damaged reputation made recruiting top talent nearly impossible. Many players transferred to other schools.
  • Long-Term Effects: The repercussions extended for decades, making it difficult for SMU to rebuild its football program to a competitive level.

The SMU case highlighted the NCAA's rigorous enforcement policies and its strict adherence to amateurism, which prohibited any form of direct payment to athletes. This case became a symbol of the NCAA's hardline stance, influencing the organization's legal and regulatory approach for years to come.

Recent Changes and the NIL Era

Fast forward to today, and the NCAA is undergoing a monumental shift. In a historic settlement agreement addressing three major antitrust cases, the NCAA has agreed to funnel over $15 billion to athletes over the next decade. This settlement marks a significant departure from the rigid amateurism rules exemplified by the SMU case.

The new revenue-sharing model allows schools to compensate athletes directly for the use of their Name, Image, and Likeness (NIL), aligning with the broader trend of athletes monetizing their personal brands.

Athletes are now allowed to be social influencers - for their own school. This shift aims to stabilize the chaotic recruiting landscape and prevent further legal challenges, although it stops short of permitting pay-for-play and booster payments.

College AthleticsPhoto Credit: Sporcle 

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Other Notable NCAA Violations

SMU is not alone in the annals of NCAA infractions. Several other schools have faced significant penalties for similar violations:

  • University of Southern California (USC): In 2010, USC's football program was hit with severe sanctions, including a two-year postseason ban, scholarship reductions, and vacating wins from the 2004 season, due to improper benefits received by star player Reggie Bush and his family. The big news here is - Reggie finally received his 2005 Heisman trophy thanks to the reversal of the legal cases.

  • University of Miami: In the early 2010s, the Hurricanes' program was embroiled in a scandal involving a booster who provided impermissible benefits to athletes, including cash, gifts, and lavish parties. The NCAA imposed penalties, including scholarship reductions and recruiting restrictions.

  • Penn State University: While not related to player compensation, the Jerry Sandusky scandal led to unprecedented NCAA sanctions in 2012, including a $60 million fine, scholarship reductions, and a four-year postseason ban. These penalties were later reduced on appeal.

  • University of Louisville: The basketball program faced sanctions in 2017 after it was discovered that a former staff member arranged for strippers and sexual activities for recruits. The NCAA vacated wins, including the 2013 national championship, and imposed fines and scholarship reductions.

The New Way Student-Athletes Make Money

The transformation of the NCAA's stance on athlete compensation, marked by the recent settlement agreements, represents a significant evolution from the days of the SMU "Death Penalty." As college athletics move into a new era of NIL agreements and direct compensation, it reflects a broader recognition of athletes' contributions and rights, reshaping the landscape of college sports.

This shift, driven by legal pressures and changing economic realities, underscores the need for ongoing reforms to ensure fairness and stability in collegiate athletics. It also means student-athletes don't have to wait until their professional careers to start supporting their families and building their own nest eggs. This change could influence the future of professional sports, as more students might choose to complete their college education or even prioritize getting an education before turning professional.

Leveraging NIL to work with student-athletes offers brands a unique opportunity to connect with engaged and loyal audiences, enhance community engagement, and build authentic and trusted brand relationships. By choosing the right athletes, crafting authentic and compliant partnerships, and continually measuring success, brands can effectively use NIL to enhance their marketing efforts and drive significant value.

Examples of Successful NIL Partnerships

Successful NIL partnerships demonstrate the potential for brands to connect with engaged audiences and build strong, authentic relationships. These collaborations can drive significant value when executed thoughtfully. Here are ten examples of successful NIL partnerships that highlight how brands have effectively leveraged student-athletes' influence:

  • Dr. Pepper and Clemson’s DJ Uiagalelei: The soft drink brand signed Uiagalelei for a national ad campaign, leveraging his growing popularity to target a younger audience and college football fans.

  • Boost Mobile and the Cavinder Twins: Haley and Hanna Cavinder, known for their massive social media presence, partnered with Boost Mobile to promote the brand on their platforms, effectively reaching millions of followers.

  • Nike and UCLA’s Kiki Rice: Kiki Rice was the first athlete to sign with Jordan Brand, a subsidiary of Nike, highlighting Nike's strategic investment in young talent.

  • Gatorade and Shedeur Sanders: Sanders, the Colorado quarterback, partnered with Gatorade, leveraging his high-profile position and social media following.

  • Leaf Trading Cards and Jordan Travis: Florida State quarterback Jordan Travis signed with Leaf Trading Cards, bringing a traditional sports memorabilia company into the NIL space.

  • WWE and Gable Steveson: The Olympic gold medalist and Minnesota wrestler signed an NIL deal with WWE, showcasing the brand’s effort to attract top athletic talent and expand its audience.

  • American Eagle and Paige Bueckers: The UConn basketball star partnered with American Eagle for a campaign that emphasized body positivity and self-expression, resonating with the brand’s young, fashion-forward audience.

  • Cash App and Gonzaga’s Jalen Suggs: Jalen Suggs teamed up with Cash App to promote financial literacy among college students, using his platform to educate and engage his peers.

  • GoPuff and Penn State’s Sean Clifford: The delivery service GoPuff signed Sean Clifford to enhance its visibility among college students, leveraging his status as a well-known athlete in a key market.

  • Wingstop and Miami’s D’Eriq King: Wingstop partnered with D’Eriq King to create engaging social media content, tapping into his strong following and charismatic personality to promote the brand.

cavinder twins

Photo Credit: Sports Illustrated

Steps to Partner with Student-Athletes

As the landscape of college athletics continues to evolve with the introduction of NIL policies, brands have unprecedented opportunities to collaborate with student-athletes. These partnerships can drive significant value for both parties, but they require thoughtful planning and execution. Here are the key steps to ensure your brand effectively works with student-athletes:

  1. Identify the Right Athletes

    • Relevance: Choose athletes whose personal brand aligns with your product or service. Look for individuals who naturally represent your brand values.

    • Reach: Assess the athlete’s social media following and engagement rates to ensure they have a substantial and active audience.

    • Performance and Visibility: Consider athletes who are high performers in their sport, as they tend to have higher visibility and media coverage.
  2. Craft Authentic Partnerships

    • Genuine Fit: Ensure that the partnership feels natural to the athlete’s persona and fanbase. Authenticity is key to resonating with the audience.

    • Long-Term Relationships: Consider long-term deals rather than one-off campaigns to build a stronger connection and more consistent messaging.
  1. Compliance and Contracts

    • NCAA Regulations: Make sure to stay updated with NCAA and school-specific NIL regulations to avoid any compliance issues.

    • Legal Contracts: Draft clear contracts outlining the expectations, deliverables, payment terms, and compliance requirements for both parties.
  1. Creative Campaigns

    • Content Creation: Leverage the athlete’s influence by involving them in content creation. This could include social media posts, videos, and live streams.

    • Events and Appearances: Use the athlete for brand events, meet-and-greets, and promotional appearances to drive engagement and attendance.

    • Merchandising: Co-create branded merchandise featuring the athlete’s name, image, and likeness, which can be a lucrative venture.
  2. Measure and Optimize

    • Track Performance: Use analytics to measure the effectiveness of your campaigns. Track metrics such as engagement rates, sales lift, and brand awareness.

The Importance of Compliance

As brands venture into NIL agreements, staying compliant with NCAA and state-specific regulations is crucial. The landscape is continuously evolving, and understanding the legal framework is essential to avoid potential pitfalls. Brands should work closely with legal advisors to ensure all agreements comply with current laws.

While NIL agreements offer exciting opportunities, they also come with challenges. Brands must carefully manage public perception and ensure that the athlete's actions align with their values. Navigating the complexities of multi-state regulations can be daunting, but thorough research and legal guidance can mitigate these risks.

The Role of Social Media + Future of NIL

Social media plays a pivotal role in the success of NIL deals. Brands can leverage student-athletes' existing social media presence to create engaging and viral content. Effective social media campaigns can amplify the reach of NIL partnerships, tapping into younger, more digitally savvy audiences.

Looking ahead, the NIL landscape is set to evolve further. Emerging technologies such as NFTs and blockchain could revolutionize athlete compensation and brand partnerships. Brands should stay informed about these developments to capitalize on new opportunities as they arise.

The NCAA's transformation of its stance on athlete compensation marks a significant evolution in college sports. NIL agreements offer brands a unique opportunity to connect with engaged audiences and build authentic relationships. By navigating this landscape thoughtfully and strategically, brands can harness the power of NIL to drive significant value and stay ahead in the competitive market.

Just like with any social influencer or celebrity endorsement, when a high-profile athlete's off-field behavior contradicts a brand's values, it can lead to negative publicity. Brands should conduct thorough background checks and consider the athlete's overall persona and actions before entering into agreements.

Revolutionizing College Athletics

The introduction of Name, Image, and Likeness (NIL) policies marks a transformative shift in college athletics, offering student-athletes unprecedented opportunities to monetize their personal brands through various commercial avenues. Reflecting on the SMU "Death Penalty" case, which underscored the NCAA's strict enforcement of amateurism, it's clear that college sports governance has evolved significantly. Today, NIL policies provide a platform for athletes to leverage their fame, while brands benefit from unique marketing channels. As we move into this new era, the collaboration between student-athletes and brands promises to reshape the landscape of college sports, fostering a more equitable and dynamic environment.

My team is always here to help brands navigate the challenges that come with working with social influencers, along with the software that provides deep-dive analytics on who the right partners actually are. Give us a shout if you need some help.

Eager To Learn More?

For more strategies for successful brand partnerships and insights into the evolving landscape of sports marketing, explore these additional articles from the Hollywood Branded team.

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