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April 28, 2022 // Jen Wood // Opinion  //       //  Opinion

Navigating The NIL Marketplace

When NIL legislation became law in July 2021, it opened the floodgates for college athletes to partner with companies and monetize their success. Historically, NIL opportunities were talked about in terms of appearances and autographs. But unsurprisingly, the bulk of all NIL deals to date have leaned on the success of digital solutions from social media posts and content to NFT creation.

The first nine months of this marketplace have seen a flurry of activity, but have also exposed a few opportunity areas:

  • Despite NIL legislation being touted as benefitting all college athletes, recent data from the platform Opendorse shows 51.1% of all NIL compensation has gone to college football players and 72.6% of all compensation has gone to male athletes.
  • Many experts say this imbalance is a result of systemic inequities that exist in sports. Brands could help correct this imbalance by purposefully crafting NIL programs that highlight a diverse representation of athletes across both men’s and women’s sports.
  • Even though there’s a desire from all stakeholders to have uniform NIL standards, there’s currently no governing body overseeing this. Depending on your industry, it’s still a bit of the Wild West in terms of who you can partner with. Rules differ by college and conference, leading some conferences to allow NIL partnerships with alcohol and sports betting companies, for instance, while other conferences and schools do not.
  • Brands must do their due diligence before approaching an athlete and hire an agency, especially if they’re in a highly regulated industry, to help navigate the constantly changing landscape and make recommendations around the athletes who can help achieve their goals.
  • There is great variability in the savviness and experience of those negotiating these deals, with some athletes represented by traditional agents and other athletes left to negotiate on their own. Some universities, such as Ohio State’s NIL Edge Team, have formed expressly to help athletes navigate this void. This creates inconsistencies in how services are priced and opens the door for certain athletes to be taken advantage of.

Partnering with a college athlete, as with any influencer, comes with risk. Not only are proper vetting and contract structure essential to a successful partnership, but athlete deals have more visibility than traditional influencer relationships. This heightens the opportunity for brands to be called out for unfair practices. Using tools, such as A+P’s Influencer Impact Score, helps provide consistent vetting and pricing guidance to ensure each deal is approached equitably.

One thing is for certain the NIL marketplace’s size and influence will continue to grow. And athlete brand-building efforts will continue to be a huge focus, taking an even larger role in recruitment efforts. Not only will colleges seek to recruit college athletes who are already influencers and can bring that follower base to their school, but they’ll also look to market their institutions’ ability to help athletes build their personal brand by playing at the university. Expect athletes across all college sports to become savvier about their marketing potential and create an exponentially larger industry marketplace.

Jen Wood is senior vice president of Integrated Marketing at Allison+Partners. She’s spent the past 10-plus years of her career in Sports Marketing and Sponsorships overseeing all aspects of her clients sports marketing efforts – from sponsorship strategy development and partner identification, to negotiating multi-million-dollar sponsorship deals with collegiate and professional sports organizations and athletes, partnership activation, and ultimately measuring asset utilization and performance. She’s passionate about the opportunities sports marketing provides and is always ready to chat with an interested brand.

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