What, No ‘Free Unlimited Barbecue from the Cozy Corner’ Clause?

With college football and basketball programs changing their uniforms so frequently nowadays — and often changing to designs that many people don’t like — I’m often asked, “What kind of deal does that school have with Nike [or Adidas, or whomever]? Like, did they have to pay for those ugly uniforms? How does it work?” I got some similar questions after my recent post about Nike owning Mississippi State’s logo.

My standard response is that every contract between a school and an outfitter is different and that there’s no way for me to know the terms of any individual deal. The larger truth is that I’ve always been rather ignorant regarding the way these contracts work, so I’ve never felt comfortable talking about them.

That has now changed, thanks to reader Jimmy Griggs. He was poking around on the web and found a link that provides a PDF of Nike’s 2008 contract with the University of Memphis. There’s nothing sneaky about it — as you can see from the URL, it’s hosted right there on the school’s web site. (The contract includes a confidentiality clause, but that clause also mentions the Tennessee Public Records Act, which I assume is why the contract is on the school’s web site, since Memphis is a state university.)

For the record: This contract doesn’t say anything about Nike owning any designs or colors it creates for Memphis (or if it does say that, I missed it). Indeed, most of the contract seems fairly straightforward and sensible. But it provides an invaluable look at how a big-time outfitter does business with a big-time college athletics program.

The contract isn’t all that long, doesn’t have much legal-ese, and is consistently interesting, so I encourage you to read all of it. But here are some highlights:

• Section B.1.(a) sets out Nike’s status as the school’s official outfitter (for all of these excerpts that I’m posting, you can click to enlarge):

• Section B.2. specifies that Nike will provide “men’s apparel” (presumably suits) for the men’s basketball coach:

• My favorite clause in the entire contract is Section B.3.(d), which states that spatting “is inconsistent with the purpose of this contract”:

• Section B.3.(f) is interesting, because it sets out the procedures to be followed in case one of Nike’s designs is found to be in violation of NCAA rules:

• Things start to get more serious in Section C.1.(a), which stipulates that Nike will provide the school with $1.5 million worth of uniforms and equipment per year:

• But the school doesn’t just get uniforms from Nike. According to the terms of Section E.2., Nike will provide cash payments to the school at a rate of $660,000 per year, plus a half-million-dollar signing bonus, plus a few perks (but note subsection (e), which states that the annual payment goes down to only $400,000 if John Calipari is replaced as the basketball coach, which of course is exactly what happened shortly after the contract was signed):

• So based on those last two sections, Nike is in the hole for a total of $11.3 million in cash and gear over the five-year term of the contract. What do they get in return? Well, for starters, they get a bunch of perks (stadium signage, free tickets, parking passes, access to coaches, announcements on the P.A. system at games, ads in school publications, etc.), as spelled out in Section G:

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Now, most of you are probably thinking, “There’s no way those free tickets add up to a value of $11.3 million.” True enough — most of that stuff in Section G is just window dressing. So how is Nike going to make back its upfront costs? Duh: By selling merch. Now it becomes apparent why Nike pushes the retail product so hard — they pretty much have to, because they have to pay a lot upfront just to get in the door. This makes it really clear how the merchandising tail wags the on-field dog.

Consider how different this is from the old way of doing things. Back in, say, the 1970s, companies like Spalding and Rawlings didn’t provide uniforms to universities for free, and you can bet they didn’t provide cash payments either. Instead, the schools bargained for the cheapest price they could get and then bought the uniforms from the company — simple. But that was before anyone had figured out that fans would pay $200 for a polyester shirt, and it was also before sporting goods companies started thinking of themselves as lifestyle brands.

Nike talks a lot about how everything they do is for the athlete, how they’re always pushing for more performance-based innovation, and so on. And it’s true that they’ve pioneered all sorts of research with biometrics, wind tunnels, thermal imaging, new fabrications, and all of that — that stuff is legitimately innovative. But how many serious athletes actually wear Nike gear? Not that many, because there aren’t that many serious athletes out there. Most of the people wearing Nike product are people like you and me: a mix of fans, weekend players, couch potatoes, and collectors. That group of people numbers in the multiple millions — that’s where the money is, and that’s who Nike is really working for. Nike can afford to sink huge amounts of money into a program like Memphis athletics, because it builds their cred with people who’ll never need thermal imaging but who nonetheless like the idea of owning high-tech gear. (Obviously, none of this is unique to Nike — Adidas and Under Armour play the same game.)

I’m no lawyer, so I may have overlooked some ticking time bombs or other notable bits in the contract. If any of you legal eagle types want to take a look at the document and provide your assessments, I’d be happy to print them at some point down the road.

One final excerpt from the contract: According to Section J.3.(b)(4), Nike can terminate the agreement if anyone at the school makes any negative comment about Nike gear:

So if Nike comes up with some new cleats and they slip on the turf, nobody can say anything. If a new fabric ends up ripping too easily, nobody can say anything. If there’s backlash against a wacky new design, nobody can say anything.

And never was heard a discouraging word — because it was written into the contract that way.

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Culinary Corner: As you may recall, a few months ago I wrote about the pleasures of chicken wing tips, and how I think they’re neglected, overlooked, etc. Some of you made fun of me for this (one guy in particular wrote a lengthy screed telling me the whole notion of wing tips was an example of “weird shit you do just for the sake of being weird [that] just makes you look like an idiot”), but whatever. I recently decided the wing tips idea could make a good piece in a food magazine, so I pitched the story to a few publications, and now I’m happy to report that I’ll be writing about wing tips for Saveur magazine’s web site. Validation! I’ll post a link when the piece runs, which I believe will be next month.

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Uni Watch News Ticker: The good news is that MLB will no longer be desecrating the American flag with its Memorial Day cap designs. The bad news, as I’d reported last month, is that they’re playing G.I. Joe instead. Very disappointing. Memorial Day is about remembering the fallen — why not have everyone wear a black armband (a uni element that has fallen into utter disuse)? Or as I’ve suggested for years now, why not wear throwback uniforms based on old military baseball teams? Or why not stop the pandering and just have a moment of silence followed by a baseball game? ”¦ “The Dolphins held a fundraiser last week and players wore their aqua jerseys,” writes Dan Isaacson. “You can see that the jerseys were the Reebok style, with the NFL Equipment shield, but the team colored in the Reebok logo with a Sharpie.” … The Liberty Bell icon on the Phillies’ stirrups and socks only appears on one side — it’s supposed to face outward. But Hunter Pence had one facing inward on Tuesday night (good spot by Jim Satriano). … Jake Hurley is obsessed with getting the Rockies to wear striped stirrups. A noble cause, although I suspect a quixotic one. … “In order to make ends meet, some potential U.S. Olympic athletes (those not supported by their sport’s federation) have sold ‘sponsorship’ tattoos,” reports Tom Mulgrew. “These can’t be displayed during qualifying events or at actual Olympic events, but they’re okay during non-Olympic meets.” … Okay, this is really weird: a Mr. Magoo doll in a baseball uniform. … Hamilton Nolan of Gawker reaffirms his status as the best cultural critic around with this piece about a recent advertising conference. Granted, making fun of an ad conference is almost too easy (I pulled essentially the same stunt by covering a marketing conference back when I wrote for Fortune in the late 1990s), but Nolan’s critique is particularly sharp. My favorite passage: “Advertising rhetoric is notable in that it uses the language of art to describe the activities of business. I interpret this as the purest sort of propaganda, though it could more generously be interpreted as a sort of subconscious maneuver to invest a dreary business activity ”” selling things ”” with a more noble and attractive sheen. … In this world, creativity exists in a bubble, allowing it to be admired and marveled at by peers without making the dreary connection to its actual societal function. The Most Interesting Man In The World, yes; the fluctuations in the market cap of Heineken International, no.” Highly recommended reading. … “I’m an assistant baseball coach for the high school where I teach in Indiana,” writes Craig McKean. “I worked hard on influencing my head coach to go back to striped stirrups this year.” Very nice — well done, Craig! … Cycling news from Michael Roecklein, who writes: “A few days ago there was a bad crash in the third stage of the Giro d’Italia and the overall race leader, American Taylor Phinney, went down and hurt his ankle. The next day was a rest day, and Phinney was seen wearing one compression sock and altering his cycling shoes to fit his swollen foot. He also has lace-up shoes, which are uncommon in modern cycling and are usually limited to velodrome racing.” ”¦ More about single-digitized pitchers: Ken McCabe points out that when the Astros announced the signing of Shawn Chacon in February of 2008, the last line of their press release stated, “He will wear jersey number 1 for the Astros.” But Chacon’s Baseball Reference page shows him having worn 30 and 32 for the ’Stros. Interestingly, the caption to this 2008 Photo Day shot — taken just a few days after that press release was issued — lists him as No. 1, but all the regular season photos of him that I could find from that season show him wearing 30 or 32. So he apparently wore 1 only during spring training. ”¦ New uniforms for Michigan hockey (from Justin Howland). ”¦ Anyone know what Gil Hodges had on the handle of his bat? (As spotted by Marshall Rase.) ”¦ Lots of old-timey design goodness in this 1939 Packers/Cardinals program (from Mike Rengel). ”¦ Reprinted from yesterday’s comments: Fun little piece about the artist who created the Swinging Friar. ”¦ Blain Fowler found a 2009 article about Tiger Woods’s concussion. Note the brain illustration. ”¦ The Rangers are going with a 1972 Topps motif for their scoreboard this weekend (from Greg Stamps). ”¦ Weird scene in L.A. the other day, as former Clipper Keith Closs wore his own jersey to the game (from Robert Silverman). ”¦ Chipper Jones is getting the retirement tour treatment whenever the Braves go on the road this season. Before yesterday’s game at Wrigley, the Cubs presented him with the Braves flag from the ballpark’s standings display (from Terry Duroncelet). ”¦ Soccer news from Donnie Kwak: “Much-coveted Belgian soccer player Eden Hazard, who currently plays for Lille in France, cryptically informed reporters, ‘It’s the blue that I’ll be wearing next season. Definitely the blue.’ He’s already stated that he wants to play in the English Premier League. So will it be Chelsea? Manchester City? Or any one of the number of EPL clubs that have blue as a primary color?” ”¦ New third kit for Olympique Marseille — and it’s reversible. “Oddly, only the black side has the sponsor logo and the three stripes, so that’s the one we’ll probably see more of,” says Jon Forbes. ”¦ What is this — a padded facemask? According ot the caption, that’s Lions WR Leonard Thompson, wearing “his new helmet to protect his jaw” in December of 1983 (from Russ Yurk). ”¦ Were you waiting for someone to invent Kevlar basketball shoes? Well here they are anyway (from Omar Jalife). ”¦ Rolling Stone got a bunch of rockers to name their favorite baseball uniform (thanks, Brinke). … The Seattle Sounders and FC Dallas played color vs. color last night (from Lars Johnson).