The U. of Michigan's contract with Nike

In 1994, the U. of Michigan entered into a 6-year contract with Nike. Under this contract, Nike receives exclusive rights to the U. of Michigan's official sportswear for retail sale. The contract was a major merchandising boost for Nike. Besides receiving rights to the U-M logo, Nike gained worldwide product exposure, U-M coach endorsements, and advertising space on U-M property. Details are below (from Agenda, March 1997).

The University gets:

• Nike apparel and shoes, totaling more than 23,000 items over six years for football, basketball, hockey, baseball, softball, swimming, wrestling, golf, tennis, field hockey, cross-country, track and field, gymnastics, volleyball, soccer and cheerleading squads.
• Up to $68,000 a year in additional merchandise from Nike’s product catalogs.
• $15,000 more in merchandise for the men’s football team.
• Up to $50,000 in non-Nike apparel products covering items Nike buys that are not available in the Nike products line.
• $200,000 in "base compensation" to replace pre-existing contract with basketball coach Steve Fisher if and when he is replaced.
• One free pair of shoes for each two pair bought from Nike for the U-M’s marching band.
• Four summer internships for students at Nike’s Oregon headquarters; Nike either pays salary or students get academic credits and Nike pays expenses.

Nike gets:

• Pledge that all coaches, staff and team members wear only Nike apparel, with logo visible, at all athletic events.
• Exclusive designation as U-M’s official merchandise supplier.
• Right of first refusal to extend the contract after six year.
• First rights to sell new products to U-M.

The City of Ann Arbor gets:

• $50,000 from Nike for an outdoor basketball court at the new Southeast Area park, near Platt and Ellsworth.

Nike gets:

• Exclusive rights to sell "authentic" U-M sports apparel.
• The right to design a new logo, subject to U-M approval, and exclusive rights to sell all products with that new logo.
• Rights to endorsements from U-M coaches for Nike products.

Nike gets:

• Two advertising panels at Crisler Arena
• Four advertising panels at Yost Arena
• Right of first refusal for any new signage space at U-M athletic facilities.
• It logo in media guides, schedules, and other sports publications and videos.
• Season tickets: 10 for football, 6 for men’s basketball, 6 for women’s basketball, 4 for hockey.
• 50 tickets to one home football game and four tickets to all away games.
• 25 tickets to one home basketball game and four tickets to all away games.
• 6 tickets to all post-season football and basketball games.
• 25 tickets to two home hockey games.
• 112 other tickets and eight field passes for 1994-5 games.

The University gets:

• $35,000 from Nike in 1994-5 and $60,000 each year after that.

Nike donates:

• 6 annual $25,000 scholarships for a women’s basketball player.
• 6 annual $25,000 athletic scholarships in any sport for a women "who exemplifies a commitment to improving the lives of America’s disadvantaged youth."
• $45,000 over three years to the Chris Webber Endowment Fund, for scholarship aid to LS&A students.
• 5 annual $55,000 scholarships totaling $275,000 to the university’s Michigan Journalism Fellows program.

Nike gets:

• Ads in football, basketball and hockey programs
• Up to 6 appearances by football and basketball coaches and up to 3 appearances by other coaches annually to endorse Nike.
• Participation by men’s basketball team in Nike tournament.
• Participation by U-M coaches in confidential testing of Nike products.

The University gets:

• $15,000 first year, $30,000 each additional year.

Nike gets:

• Space in U-M athletic facilities for retail sales on game days.