Michigan Takes A Huge Jump…Man and Finalizes

Nike Contract

From Adidas To The Jumpman

Article Overview-The Detroit Free Press released an article publishing The University Of Michigan's final contract with Nike.

-Michigan and Nike announced a partnership that has already begun this year in 2016 and will last up to 11 years through 2027.

-Nike as well as Air Jordan (Same company) will be the official outfitter for The University of Michigan's uniforms, off field apparel, and gear.

-Nike is taking over Adidas which was the official outfitter for Michigan over the last several years.

Article Overview-The contract between Michigan and Nike could total $178.3 million in a four year option if extended after the 11 year deal.

-The 11 year term is worth $127.12 million --- $53.52 million in cash payments, $56.8 million in apparel and a $12-million signing bonus/initial payment that was scheduled to be paid ten days after the contract was signed March 16.

-U-M also has the option to order an additional $4.8 million in apparel not included in the yearly totals.

-The contract, which covers 31 U-M sports, was signed by athletic director Warde Manuel on his third day in the position.

Article Overview

-When the Nike agreement was announced last summer, it was presented as the biggest contract between a school and a shoe/apparel company

-Texas (15-year, $200-million extension) and then Ohio State (15-year, $252-million extension) reportedly reconfigured their deals with Nike and since have passed the Wolverines.

- There are performance bonuses for the football, men's basketball and women's basketball teams.

-The football team's range from $100,000 for winning the national championship to $10,000 for reaching the Big Ten title game.

- The basketball team's top bonus is $25,000 for winning the national title. The women's team can earn up to $7,500 for winning the national title.

Globalization

-What it is: A finalized contract that allows Nike to sponsor The University of Michigan.

-Michigan athletics and Nike are two separate organizations that will be joining forces to create a powerhouse image for The University of Michigan and the NCAA

-We’ll get deeper into why these two organizations will both impact the concept of globalization

Globalization for Nike

-Expands the company’s market across the world.

-Aside from the swoosh, The Jumpman Air-Jordan logo will also be apart of The schools image.

-Air Jordan only sponsors a select group of teams in the NCAA.

-Fans from all over the world make their way to The Big House to watch the Wolverines play, which is the biggest stadium in college sports.

Nike Expanding Across North America

-Michigan is the first college football team in history to be sponsored by Air Jordan- businessinsider.com

-This will make Michigan’s football fan base even bigger than it already is.

-The following leads to:-Bigger retail market.-More media coverage.-Which will expose the Nike/Jordan brand.

Nike Expanding Across North America

-While Michigan is the only football team represented by Air Jordan, The Jumpman logo represents a select group of basketball teams in the NCAA.

-Football and basketball are most popular in the United States and Canada, However the better that teams perform, the more attention they receive worldwide.

-For example: The Michigan Wolverines are an image of NCAA football because of their past success. Therefor, the Nike/Jordan brand will be more profitable in an area like this.

Air Jordan and NCAA Basketball-Michigan basketball will now be represented by Air Jordan as well as other organizations.

-Such as: California, Marquette, North Carolina, Georgetown, and a few others. –Uniformcritics.com

- This presents the opportunity each year to allow Air Jordan to take product to the next level and dress different players across The United States of America.

Globalization for the NCAA

-The Nike/Air Jordan brand will begin to appear in more stores across the world

-The jersey sales have already rose for The University of Michigan and will appear in more stores than before.

-In the near future, Jersey advertisements could happen as we have already seen in the NBA which could then lead to more opportunities to expand the brand itself globally.

Globalization for the NCAA

-Nike must adhere to the Nike Code of Conduct regarding labor standards, including a list of factories where the products are made, for external monitoring.

-Many of U-M Olympic sports have existing agreements with third-party suppliers, and those are allowed to continue. –Freep.com

- Nike receives a suite for each football game and a box for basketball, plus in-game public address ads and full-page ads in every game program. –Freep.com

Michigan Brand in Nike/Jordan Stores.

-Nike/Air Jordan has stores, outlets, employees all across the globe.

-The brands/organizations will become more gradually displayed as the partnership kicks off this year for all of Michigan athletics.

-As the Stage continues to get bigger for the NCAA, The following teams represented by Nike/Jordan will be exposed more to consumers of more locations and different regions across the world.

The Nike Headquarters Effect-Nikes headquarters is located in Beaverton, Oregon

-Michigan partnering with Nike/Jordan will take communication and organizational structure to the next level due to the demand being higher for the new gear.

-New gear means more jobs which could even lead to new stores.

-Michigan/Air Jordan pop up shops were displayed all across the state of Michigan.

-The Michigan city's were: Franklin, Ann Arbor, Farmington Hills, etc.

Advertisements

-Advertisements exists all over sports venues -On the fields/courts -On Walls -In stadium -In game and school programs -On scoreboards -The increase in Michigan Nike/Jordan ads will raise more awareness about the program across the world.

How do Advertisements Affect Globalization

-Jersey sponsorships take sales to the next level.

-When a fan sees their favorite organization, they will most likely connect it to the organization sponsoring the jersey

-If an individual loves their sports teams, then they do indeed love everything apart of it which includes the sponsor logo on it.

-Fan bases often have a positive viewpoint of their current teams sponsor, especially when their football team is ranked in the top four for polls.

Growth

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-This lovely new partnership will raise the retail market in all athletic stores that sell Michigan gear.

-A top tier sponsorship worth hundreds of millions of dollars will help build an even bigger fan base for The University of Michigan.

-The coaches of the flagship programs (football, men's and women's basketball) have to make two appearances on behalf of Nike each year. Other coaches must make one each year.

-The following above will give coaches more face time which leads to more media time which then leads to bigger contracts if they continue to succeed.

Consistency

-Every organization wants to see consistency day in and day out, but it only happens when positive outcomes feed off each other.

-If Michigan football continues their success and ends up going deep in the college playoffs, their basketball, baseball, etc programs, will feed off that energy and very likely have a better season than the one before.

- Its easier to be successful when you have a great supporting cast as we saw Tom Brady, Derek Jeter and many other Michigan men on the field for Michigan's first home game at The Big House.

Questions

-Will the Air Jordan Logo every be put on athletic equipment itself? (such as footballs and basketballs)

-If Jersey advertisements to find their way into the NCAA, how will they keep the traditional look of the uniform without upsetting the fans and alumni?

-In 11 years when this partnership expires, will Air Jordan sponsor more football teams than just Michigan?

Questions

-Why not use the Air Jordan logo on the baseball and swimming uniforms as well?

-Will Michigan accept the four year extension with Nike/Air Jordan after the 11 years is up?

-How does Michael Jordan feel about being an image to college football?

-Will being sponsored by Nike bring in better and more recruits to Michigan Athletics?

Work Cited

1) Snyder, Mark. "Michigan Finalizes Nike Contract up to $173.8 Million." Detroit Free Press. N.p., 26 Apr. 2016. Web. 9th Oct. 2016.

2) "Reunited: Michigan and NIKE Announce Partnership." MGOBLUE.COM. N.p., 6 July 2015. Web. 09 Oct. 2016.