Navigating NIL: The future
Editor’s note: This is part five of a five-part series looking at the intricacies and practices of the NCAA’s new Name, Image and Likeness Policy approved last year.
INDIANAPOLIS (BVM) — The NIL era and the profitability for student-athletes seems like it is here to stay, whether it is adjusted or not. Based purely on the numbers from the first six months of the interim policy, the reverberations are massive, not only for the athletes profiting off their own names, images and likenesses, but also for the companies that are taking advantage of this new avenue for revenue generation.
According to a Opendorse and Front Office Sports study, companies are expected to spend $579 million on NIL deals with college athletes during the first year of the new interim policy, with the next year beginning July 1, 2022. The study found that while student-athletes are not the same as social media influencers, with their quality of content and response time being lower than traditional influencers, their engagement and quality of engagements make up for the lack of speed and content creation. In addition, the study found that so far “brands are receiving significant positive press by supporting college athletes via NIL deals.”
To this point, the biggest beneficiaries in terms of student-athletes are football (47.1%) and women’s basketball players (27.3%), who have made up over 74% of the total spend share by brands, while men’s basketball is the only other sport that has a double-digit percentage (15.61%), followed by women’s volleyball (2.4%) and baseball (1.1%) to round out the top five.
Additionally, the study found that women’s college sports are also benefiting greatly from the new NIL era. Following a year where the disparity between men’s and women’s sports caused an uproar, mainly due to the differences in facilities at the NCAA basketball tournaments, a report found that the NCAA undervalued women’s sports and the NCAA responded by expanding the women’s basketball March Madness tournament, which was a huge win for collegiate female athletes. It appears that, much like that NCAA decision, the decision to approve the NIL interim policy is also paying off for female student-athletes, as women’s sports make up approximately 30% of NIL revenue to this point according to the Opendorse/Front Office Sports study. The study also finds that Olympic sports may see a boost in engagement and visibility in the future thanks to NIL.
“Working with athletes has a pretty good ROI; there’s some great studies that have come out about working with college athletes versus like your typical influencer and athletes are much more effective,” San Diego State University Name, Image, and Likeness Coordinator Michelle Meyer said.
While the potential future changes are generally more positive for athletes and the college athletics landscape as a whole, there are a few that could limit how things look for the NIL in the future. This could be a myriad of things from a more restrictive updated NIL policy from the NCAA limiting things such as team deals to the amount a student-athlete could make on NIL deals or all 50 states or even the nation adopting NIL policies. These could impact several aspects from what deals can be made, who can make them, who can limit them and how much could be made. While a national policy seems to be a few years down the road if it even happens at all, adjustments to the NIL policy does seem to be on the horizon, especially with the vast differences between institutional and state policies.
“It’s hard,” University of Illinois Athletics NIL Director Kameron Cox said. “We need a federal solution. What you’re dealing with is a patchwork of 28 different state laws. When you’ve got that many laws in your hands, it’s not as simple as ‘let’s repeal this one, let’s repeal that one and figure out if the NCAA can do anything.’”
Now what?
While legislators and college administrators sort out the NIL policies, college athletes will continue to wheel and deal for their own personal financial growth. Though changes appear to be on the horizon, until that time, student-athletes will still be able to enjoy the wealth that the NIL interim policy has allowed them. Businesses and brands will also reap the benefits as the massive influx of spending by companies will likely only grow as more research is done and positive findings are made.
The expectation is that the athletes, the institutions and the businesses will all catch up as the understanding of the NIL process becomes more common knowledge. This will likely change the sports landscape even more than it already has in the policy’s first six months.
“It’s going to take a real law, a federal law to basically come in and preempt the state laws and resolve it,” Cox said. “Will that happen in short order? No and until then we’re going to continue to be in a situation where people figure it out. But that’s not a bad thing…I think if you give it a couple of years to kind of shake out and a federal solution comes in the future, you can make sure you’re closer to the mark and get it just right.”
“It seems to me, even outside NIL, the NCAA is looking for the conferences to take over a lot of the kinds of things the NCAA has done historically and putting more power in the conferences’ hands,” Meyer said. “It is possible that the NCAA will become a championship organization in like five to 10 years…I don’t think the NCAA has power to do anything in the NIL space right now besides collect information and hope the government takes over and sets rules and I don’t think that’s a bad thing.”
With the benefits from NIL for nearly all parties, it seems that the era is here to stay, now it is just a matter of fine-tuning the details and hammering out a more solid policy. Given freedom, growth and, of course, profit, college athletes are welcoming the NIL world with open arms.
“I think NIL is the greatest grassroots marketing opportunity in history and I think brands that understand how to leverage name, image and likeness and the collective ability for student-athletes to reach fans and be influencers will reap significant, significant benefits,” SANIL Chief Executive Officer Jason Belzer said. “I think the NIL will always be a very convoluted and hard to manage industry but it’ll be a billion dollar industry in no time.”
Click here for part 1: What is the NCAA’s policy and who does it impact
Click here for part 2: Issues and their implications
Click here for part 3: The athletes
