The NCAA News - News and Features

The NCAA News -- April 12, 1999

Buying into the NCAA

Partners, licensees boost resourceswhile building good will for Association

BY GARY T. BROWN
STAFF WRITER

It's hard to sell cookies with a message.

But that's what the NCAA corporate-partner program is charged with doing, melding the mission of the nonprofit NCAA with high-profile, bottom-line companies like GTE, Gillette, Nabisco, Pizza Hut and Pepsi.

The corporate-partner program juxtaposes good will with product, which may sound awkward from a philosophical standpoint, but at the end of the day both the do-gooders and the bean counters seem to come out smiling.

The reason? Maybe it's because both parties want to tout the same message. The NCAA and the companies it recruits as partners share the same principles and values -- those of promoting all that's positive about intercollegiate athletics.

If the partnership is successful, the NCAA benefits from the advertising while companies improve their image. And while no one denies the importance of the dollars, the promotional windfall means just as much.

"Without the money, we couldn't operate successfully as a Division I institution," said Darlene Bailey, associate director of athletics at Southwest Missouri State University. "But we work hard on our campuses to promote the image of the student-athlete and get our corporate partners involved in things that involve the community. When it's all said and done, yeah, we've got the check, but the corporate partner feels good about the way they're involved with our school."

It may sound pie-in-the-sky to say that profit and nonprofit get along so well together, but Bailey, who chairs the marketing committee of the Division I Business/Finance Cabinet, said the real value of the program isn't measured necessarily in dollars, but in exposure.

"Schools can't buy ads in the newspaper to talk about how great their kids are," she said. "But corporate partners can do that through their programs and their own advertising."

Leveraging business, education

Though the corporate-partner program certainly has been designed to generate revenue (the NCAA expects to see about $75 million in a five-year period), more and more partners are realizing the positive by-products of image enhancement and community involvement. Currently, the NCAA has contracts with 16 partners, who pay a base fee to use the NCAA marks and tickets for at least a three-year window. The partnerships are negotiated by Host Communications, Inc., and managed by the NCAA marketing, licensing and promotions staff.

The goal from both sides is not only to spread the wealth, but the NCAA mission as well. GTE, a corporate partner since 1996, is one of the companies that has made a commitment to doing just that.

Bill Glenn, director of event sponsorships at GTE, said a successful partnership is a matter of leveraging from both a business and an educational standpoint.

"From a business standpoint, the company needs to leverage in a positive form the elements that come with the NCAA partnership, such as promoting products at NCAA championships," he said. "But the NCAA also matches up very well from an educational standpoint. Those two combined deliver a strong message about both the NCAA and the partner being concerned about academics as well as athletics.

"The NCAA certainly has been a strong image builder for us," Glenn said. "We think we've found the right combinations to drive products and services through program promotions. The NCAA brings to the table respect, integrity and image. We want to make sure we align with that."

C. Dennis Cryder, NCAA vice-president for marketing, licensing and promotions, said GTE and other corporate partners seek a relationship that embraces something more than just selling product. And while that might be hard to believe in today's bottom-line world, GTE and others seem to have been able to successfully balance message with profit.

"GTE likes what the NCAA stands for," Cryder said. "That's why they want a relationship with us. They're looking at it as more than how many phone cards will this sell -- it's more of what messages are amplified by their association with the NCAA and what positives can rub off on them and their clients. That's not to say that they don't have a good image already, but they like the principles and the values we stand for and they want to be linked with that. In the successful relationships, such as a GTE, it's because they elevate it to a higher plane."

Cryder said the corporate-partner program has its share of public detractors, but that more and more, institutions and conferences are aggressively seeking business relationships and partnerships to help meet increased financial demands.

He also said that three years ago when a special NCAA committee was created to study whether the NCAA should in fact be involved in such corporate marketing, the answer was a resounding "yes."

"And it was yes because it represented a method to spread the message about college athletics," Cryder said. "The industry of sports marketing as it relates to the collegiate field has grown, matured and evolved and now the next evolution is on the national level. If our members are doing it more aggressively for various reasons, I don't think many people can come back and challenge the merits."

Grass-roots marketing

Marketing collegiate athletics involves more than just 16 compa-nies that have paid rights fees to the NCAA for national exposure. It's about the many smaller companies under contract to produce merchandise for individual colleges and universities as well. Schools don't have to align with NCAA corporate partners -- they're free to contract with other companies to increase their brand presence.

That's where the Collegiate Licensing Company (CLC) comes in. CLC is the exclusive licensing agent for the NCAA and is responsible for licensing companies (46 in all) to use NCAA marks on merchandise that they sell retail, and to use marks on items sold or self-liquidated as premiums by corporate partners. CLC is the licensing agent for nearly 180 colleges and universities, many of the bowl games and most major conferences. The company has about 2,500 licensees under contract to produce merchandise for those various properties CLC represents.

Ironically, CLC wasn't contracted with initially as a revenue-producing or marketing entity, but rather as an enforcement entity. CLC was charged with making sure that school marks were being used correctly and on products that were acceptable to the university. As licensing became more popular, however, revenues started to mount and in some cases became the focus of the program. But the foundation of the program remains the enforcement and protection of the marks.

As for the revenue produced, CLC President Pat Battle said the vast majority of the revenue generated from a university's licensing program goes to either academic or athletics scholarships.

"Over the past 15 years, we have paid the universities we represent nearly $250 million as their share of royalties that have gone back to those scholarships," he said. "It's a significant source of revenue but it's revenue that goes for a great cause."

Battle said that institutions are becoming increasingly aware of the potential benefits associated with brand marketing. He said typically, schools that have a significant number of sales that extend beyond the campus bookstore will contract with CLC in order to protect their mark.

And as with the corporate-partner program, the benefits realized are more than dollars.

"There's no doubt that the partners and licensees are spending the dollars they spend to be a partner or licensee because they're looking at their bottom line -- if it's not good for their business then they're not going to do it," Battle said. "But besides the enforcement aspect, the mark protection and the generation of dollars for programs, it's promotion and building good will with fans.

"There are things that partners and licensees get with their relationship with the NCAA, and there are things the NCAA gets by associating with high-quality companies that are out increasing their brand presence and image in the marketplace."

Telling each other's stories

Bailey said the communication between schools and corporate partners has improved, which has been an additional boost to the program. Representatives from colleges and universities are brought in during corporate-partner meetings to relay the marketing efforts on campus. Many times, Bailey said, that type of communication will link a national company with a local initiative.

"As the corporate partners hear about these programs on campuses, it creates interest," she said. "Maybe there's a championship near the headquarters of a particular partner that gives them a different reason to be involved. The word is out better and I see a lot of interchange. The NCAA is doing a good job of communicating its mission. But it's something we need to continue to improve upon -- telling each other's stories."

One of the storytellers is Joan C. Cronan, women's athletics director at the University of Tennessee, Knoxville, who has been a presenter at corporate-partner meetings. She said the partners play an integral role in the world of promoting collegiate athletics.

"The corporate partners have helped provide the best championships we can for our athletes, both male and female," she said.

She said there is a trickle-down factor from championships involvement that extends to campuses, particularly with local contacts that are connected with a particular partner. She said the link is vital in helping NCAA schools market their product -- college sports.

"Most of us look at our jobs as three-prong," said Cronan. "First from an educational standpoint, we want to provide the best opportunities for our men and women. Second, we're also a business, and we have to engage in marketing in order to help us provide those opportunities. And third, we are obligated to sell our product and encourage fans to attend. Corporate partners help in those last two prongs by financing our programs and developing avenues in promotions and marketing."

The goal of the corporate-partner program really is to balance those three prongs. Perhaps Bailey said it best when she said, "The corporate partners can tell our story."

But Cryder said it's making sure that it's the same story that is the challenge. The message cannot be meaningful if it's mixed.

"I honestly believe that our own message points can be provided to selected corporate partners and they will help us communicate them," Cryder said. "But it can be a tough job. You may get a call from people who say they've been charged to develop a promotion to sell cookies. And you have to explain that you need to try to do this with a message. That makes for a challenge, but we get after it and find a way to do it right."