slideshare 2 organizational com
TRANSCRIPT
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Michigan Takes A Huge Jump…Man and Finalizes
Nike Contract
From Adidas To The Jumpman
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Article Overview-The Detroit Free Press released an article publishing The University Of Michigan's final contract with Nike.
-Michigan and Nike announced a partnership that has already begun this year in 2016 and will last up to 11 years through 2027.
-Nike as well as Air Jordan (Same company) will be the official outfitter for The University of Michigan's uniforms, off field apparel, and gear.
-Nike is taking over Adidas which was the official outfitter for Michigan over the last several years.
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Article Overview-The contract between Michigan and Nike could total $178.3 million in a four year option if extended after the 11 year deal.
-The 11 year term is worth $127.12 million --- $53.52 million in cash payments, $56.8 million in apparel and a $12-million signing bonus/initial payment that was scheduled to be paid ten days after the contract was signed March 16.
-U-M also has the option to order an additional $4.8 million in apparel not included in the yearly totals.
-The contract, which covers 31 U-M sports, was signed by athletic director Warde Manuel on his third day in the position.
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Article Overview
-When the Nike agreement was announced last summer, it was presented as the biggest contract between a school and a shoe/apparel company
-Texas (15-year, $200-million extension) and then Ohio State (15-year, $252-million extension) reportedly reconfigured their deals with Nike and since have passed the Wolverines.
- There are performance bonuses for the football, men's basketball and women's basketball teams.
-The football team's range from $100,000 for winning the national championship to $10,000 for reaching the Big Ten title game.
- The basketball team's top bonus is $25,000 for winning the national title. The women's team can earn up to $7,500 for winning the national title.
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Globalization
-What it is: A finalized contract that allows Nike to sponsor The University of Michigan.
-Michigan athletics and Nike are two separate organizations that will be joining forces to create a powerhouse image for The University of Michigan and the NCAA
-We’ll get deeper into why these two organizations will both impact the concept of globalization
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Globalization for Nike
-Expands the company’s market across the world.
-Aside from the swoosh, The Jumpman Air-Jordan logo will also be apart of The schools image.
-Air Jordan only sponsors a select group of teams in the NCAA.
-Fans from all over the world make their way to The Big House to watch the Wolverines play, which is the biggest stadium in college sports.
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Nike Expanding Across North America
-Michigan is the first college football team in history to be sponsored by Air Jordan- businessinsider.com
-This will make Michigan’s football fan base even bigger than it already is.
-The following leads to:-Bigger retail market.-More media coverage.-Which will expose the Nike/Jordan brand.
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Nike Expanding Across North America
-While Michigan is the only football team represented by Air Jordan, The Jumpman logo represents a select group of basketball teams in the NCAA.
-Football and basketball are most popular in the United States and Canada, However the better that teams perform, the more attention they receive worldwide.
-For example: The Michigan Wolverines are an image of NCAA football because of their past success. Therefor, the Nike/Jordan brand will be more profitable in an area like this.
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Air Jordan and NCAA Basketball-Michigan basketball will now be represented by Air Jordan as well as other organizations.
-Such as: California, Marquette, North Carolina, Georgetown, and a few others. –Uniformcritics.com
- This presents the opportunity each year to allow Air Jordan to take product to the next level and dress different players across The United States of America.
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Globalization for the NCAA
-The Nike/Air Jordan brand will begin to appear in more stores across the world
-The jersey sales have already rose for The University of Michigan and will appear in more stores than before.
-In the near future, Jersey advertisements could happen as we have already seen in the NBA which could then lead to more opportunities to expand the brand itself globally.
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Globalization for the NCAA
-Nike must adhere to the Nike Code of Conduct regarding labor standards, including a list of factories where the products are made, for external monitoring.
-Many of U-M Olympic sports have existing agreements with third-party suppliers, and those are allowed to continue. –Freep.com
- Nike receives a suite for each football game and a box for basketball, plus in-game public address ads and full-page ads in every game program. –Freep.com
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Michigan Brand in Nike/Jordan Stores.
-Nike/Air Jordan has stores, outlets, employees all across the globe.
-The brands/organizations will become more gradually displayed as the partnership kicks off this year for all of Michigan athletics.
-As the Stage continues to get bigger for the NCAA, The following teams represented by Nike/Jordan will be exposed more to consumers of more locations and different regions across the world.
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The Nike Headquarters Effect-Nikes headquarters is located in Beaverton, Oregon
-Michigan partnering with Nike/Jordan will take communication and organizational structure to the next level due to the demand being higher for the new gear.
-New gear means more jobs which could even lead to new stores.
-Michigan/Air Jordan pop up shops were displayed all across the state of Michigan.
-The Michigan city's were: Franklin, Ann Arbor, Farmington Hills, etc.
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Advertisements
-Advertisements exists all over sports venues -On the fields/courts -On Walls -In stadium -In game and school programs -On scoreboards -The increase in Michigan Nike/Jordan ads will raise more awareness about the program across the world.
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How do Advertisements Affect Globalization
-Jersey sponsorships take sales to the next level.
-When a fan sees their favorite organization, they will most likely connect it to the organization sponsoring the jersey
-If an individual loves their sports teams, then they do indeed love everything apart of it which includes the sponsor logo on it.
-Fan bases often have a positive viewpoint of their current teams sponsor, especially when their football team is ranked in the top four for polls.
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Growth
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-This lovely new partnership will raise the retail market in all athletic stores that sell Michigan gear.
-A top tier sponsorship worth hundreds of millions of dollars will help build an even bigger fan base for The University of Michigan.
-The coaches of the flagship programs (football, men's and women's basketball) have to make two appearances on behalf of Nike each year. Other coaches must make one each year.
-The following above will give coaches more face time which leads to more media time which then leads to bigger contracts if they continue to succeed.
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Consistency
-Every organization wants to see consistency day in and day out, but it only happens when positive outcomes feed off each other.
-If Michigan football continues their success and ends up going deep in the college playoffs, their basketball, baseball, etc programs, will feed off that energy and very likely have a better season than the one before.
- Its easier to be successful when you have a great supporting cast as we saw Tom Brady, Derek Jeter and many other Michigan men on the field for Michigan's first home game at The Big House.
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Questions
-Will the Air Jordan Logo every be put on athletic equipment itself? (such as footballs and basketballs)
-If Jersey advertisements to find their way into the NCAA, how will they keep the traditional look of the uniform without upsetting the fans and alumni?
-In 11 years when this partnership expires, will Air Jordan sponsor more football teams than just Michigan?
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Questions
-Why not use the Air Jordan logo on the baseball and swimming uniforms as well?
-Will Michigan accept the four year extension with Nike/Air Jordan after the 11 years is up?
-How does Michael Jordan feel about being an image to college football?
-Will being sponsored by Nike bring in better and more recruits to Michigan Athletics?
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Work Cited
1) Snyder, Mark. "Michigan Finalizes Nike Contract up to $173.8 Million." Detroit Free Press. N.p., 26 Apr. 2016. Web. 9th Oct. 2016.
2) "Reunited: Michigan and NIKE Announce Partnership." MGOBLUE.COM. N.p., 6 July 2015. Web. 09 Oct. 2016.