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).

Product Supply Contract

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 Nikeís product catalogs.
  • $15,000 more in merchandise for the menís 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-Mís marching band.
  • Four summer internships for students at Nikeís 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-Mís 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.

Promotion Agreement

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.

Sponsorship Contract

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 menís basketball, 6 for womenís 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.

Scholarship Fund

Nike donates:

  • 6 annual $25,000 scholarships for a womenís basketball player.
  • 6 annual $25,000 athletic scholarships in any sport for a women "who exemplifies a commitment to improving the lives of Americaís 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 universityís Michigan Journalism Fellows program.

Services & Advertisement Contract

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 menís 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.

Retail Sales Agreement

Nike gets:

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

The Just Don't Do It Campaign at the University of Michigan
The U. of Michigan's contract with Nike
Where it all began
Nike's track record
Nike drops the ball--the Andrew Young report
Answers to Frequently Asked Questions
Organizations, Resources, and References
Appendix 1. Breakdown of costs for a pair of Nike shoes
Appendix 2. Leak of the Ernst & Young report from Nike headquarters (NYT 11/8/97)

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