We Match Brands to Athletes for Marketing Campaigns - OS Blog

ESPN and Experts Describe Different Scenarios of Compensating NCAA Athletes Based on NIL

Written by Audrey Brown | Nov 17, 2020 7:57:40 PM

There has been an ongoing controversy about if the NCAA should allow college athletes to be compensated for their name, image, and likeness (NIL). The pros of paying college athletes are to help them support their families, allowing them to stay in college and play longer (rather than dropping out due to financial circumstances), and limiting outside pressure to point-shave or skew games from boosters, agents, and other external factors. Not to mention that these NCAA athletes generate a lot of money for their schools, so they should be compensated a little more than just receiving a scholarship. 

As for the cons of compensating NCAA athletes, not everyone can be paid the same amount. The starters and MVP’s would be paid more since they are the face of the team and who fans come to see, but that would not be fair to the other players. Additionally, players may spend their money irresponsibly if they are not used to having a lot of it. Being paid may also decrease an athlete’s incentive to attend class if they feel like they no longer need an education if they are compensated for their athletic performance rather than a degree. Another main con of paying college athletes is that it takes away their competitive character and passion for the sport. If all an athlete cares about is how much money they are receiving, they won’t care about their performance as long as they get their check.

ESPN shared different scenarios in which an NCAA athlete could be compensated for their NIL. Experts on these circumstances, including OpenSponsorship’s CEO and Founder Ishveen Anand, broke down these different scenarios. Here is what they determined: 

Social Media

An NCAA All-American athlete could potentially earn $500K-$1M on social media deals alone, depending on how many followers they have. Each post could earn them up to $10,000 if they are active on their accounts and engage with their followers. A male athlete with around 500,000 followers across their platforms could produce $12,000 per sponsored post. However, depending on where the athlete is living (big city, midsize city, or small college town), the number of posts per year could vary. A male athlete that lives in a large city can sign up to 100 deals, while a small college town athlete may only have 85-90 deals. As for the female athletes, they would only receive a maximum of roughly $700,000 per year in a large city, $575,000 in a small college town, and $525,000 in a midsize city. 

Camps/Lessons

An All-American NCAA athlete who attaches their name to a camp could earn between $10K-$20K per camp. They could also earn just as much if they partner with other college stars to host a camp together. The athletes would be paid for attending the camp, meeting the campers and taking photos with them, offering words of encouragement, and so on. In addition to headlining camps, the athletes could also host individual or group-lessons anywhere between $100-$200 per hour. 

Starting a Business

Since an All-American NCAA athlete’s potential earnings would vary based on the success of their business, they could receive an unlimited amount of money. An athlete could start their business with one-time deals like writing a book, investing in other opportunities, or recording music. The NCAA is more open to this idea than any of the other opportunities mentioned in this article and is thinking of lifting the ban on these “work products.” Starting a business could be beneficial for an athlete because it allows them to have projects outside of playing their sport and gives them a future after their athletic career. The NCAA currently allows its athletes to start and run a business as long as it’s approved by them. However, the athletes are observed constantly to ensure they aren’t using their athletic rank to advance their business.  

Commercials

If asked to do a commercial, an All-American NCAA athlete could potentially earn $100K-$500K. This depends on which of these stars sign endorsement deals with major national brands such as Nike and Gatorade. According to Phil de Picciotto, who runs the international sports agency Octagon, a national campaign typically acquires $75,000+. An NCAA athlete’s NIL may be a factor in the earnings of these campaigns, and with their limited time outside of their sport, they may only be able to do two or three campaigns a year. That’s why these athletes need to choose wisely on what companies they associate with (instead of taking any offers that show an interest) because it’s crucial when establishing their personal brand. 

Apparel Deals

Similar to commercials, an All-American NCAA athlete can earn between $100K-$500K on an apparel deal. Given that there may be restrictions on sponsoring a different apparel company than the one their team uses (for example, an athlete sponsoring Under Armour when their school wears Nike uniforms), apparel deals are slightly more complicated than others. However, similar to how companies pay NBA players half-price for their first year in the G league or overseas before moving into the NBA, the same could go for college athletes. Apparel deals are typically longer contracts, so paying a college athlete half-price (with bonus opportunities) until they are proven to be worth more is a smart decision for companies who still want the perks of sponsoring an athlete. As for the athlete, it is a way to lock in a great deal that is more long-term. Additionally, if there are conflicting interests with the larger companies such as Nike and Under Armour, an NCAA athlete can also opt to partner with companies that are not typically on uniforms or game equipment like Lululemon and Gymshark. 

To learn more about each scenario, including restrictions, market sizes, other opportunities, and resources needed, visit https://www.espn.com/espn/feature/story/_/id/29388424/how-much-money-college-athletes-make-nil-rights