Under Armour CEO Kevin Plank supported student athlete pay when he publicly stated college athletes deserve to be paid for the use of their names, images, and likenesses. This may be the first of many moves from the footwear (and athletic-wear) industry to get in the game – and market share – when it comes to the possibility of student athlete sponsorships.
Hopefully you have been following our updates on the recent challenges facing the NCAA’s prohibition on allowing student athletes to receive compensation for use of their name, image, and likeness. States around the country (check our map for new updates) have begun introducing legislation to allow compensation to student athletes. This trend has been received by both support and animosity, but the voices of the professional athletes have seemed to ring louder and louder over the last few weeks. Even Coach K supports the push for pay to play legislation, stating that college athletics must stay current.
One of the most intriguing recent supporters of pay for play legislation is Kevin Plank, CEO of Under Armour. If student athletes could receive compensation for sponsorship deals associated with their name, image, or likeness, companies such as Under Armour would be spending significant sums of money in deals with student athletes. Currently, companies such as Under Armour, Nike, and Adidas construct deals with colleges directly. This requires one to wonder how risky it was for CEO Kevin Plank to speak out about his support of pay for play legislation. Might colleges against the introduction of new legislation boycott Under Armour? Might Under Amour be looking at spending more in sponsorships with student athletes? Why then, would they publicly support pay for play legislation? These questions arise as Under Armour sealed the largest college sports footwear and apparel deal ever when it signed UCLA to a 15-year, $280 million contract in 2016. Under Armour also signed the University of California to a lucrative 10-year deal in 2016.
A simple answer as to why Under Armour issued public support is that the “values-lead company” prioritizes their “love for athletes.” Plank, who formerly played football for the University of Maryland, believes student athletes should be fairly compensated. Many supporters of the pay for play legislation cite similar values-based arguments. Senator Steven Bradford, Nancy Skinner’s cosponsor on California’s Fair Pay to Play Act, stated, “SB 206 addresses this civil rights issue of today, which is about fairness and equity. Our colleges and universities should no longer treat student-athletes as chattel, but as the valued individuals they are.”
Under Armour may see some benefits arise from its public support for student athlete compensation. Possibly strategically, Under Armour was one of the first athletic-wear companies to support the cause. With its recent public support for pay to play, Under Armour may be at the forefront when the day comes for student athletes to choose who they will sign with for endorsement deals. As soon as student athletes are able to contract with companies, this arena is likely to blow up overnight. Most notable is the potential for jersey sales and other apparel using a student athlete’s name. Big companies who dominate these types of sales in the professional arena could be looking at a new, untapped market. And what better time is there for Under Armour to start putting its name and support out there for the student athletes that may soon endorse their brands than right now, before others jump on board?
Under Armour may be taking a page from Puma’s playbook. Recently, Puma dove into the basketball footwear game by throwing tons of money at NBA rookies to model their newest design, the Clyde Court. This dive into the game shocked many, as Puma signed Marvin Bagley III to the biggest rookie shoe deal since Kevin Durant signed with Nike in 2007. Under Armour may be the brand to watch when it comes time to start forming endorsement deals with student athletes.
In his remarks regarding pay for play, Plank made sure to remain silent on whether Under Armour intends to endorse student athletes in California. Having UCLA and the University of California as Under Armour endorsers is a massive deal in the state of California and the company will want to remain as quiet as possible regarding its intentions for student athletes until the landscape of this legislation develops. As it stands, the California legislation will not come in to play until 2023. It’ll be interesting to see how Under Armour and other sportswear companies maneuver the playing field once potential deals with student athletes begin to clash with current deals with the colleges they play for.