In February, the University of Washington opened up negotiations with Nike on the school’s next sports apparel deal. The most recent deal between Nike and the UW expires in June, and had paid the school about $3.6 million per year. This contract allows Nike to meet with the UW first, but the school will entertain offers from Adidas and Under Armor.
It’s hard to tell who’s winning the right to put the glass slipper on Washington. Jon Wilner from Mercury News has reported that UW Athletic Director Jen Cohen expects to close a new deal sometime in May, so it’s good to know that the deadline is nearby.
Which company will walk away as Washington’s new apparel provider? I’d bet my dollar on Adidas for a hefty, although not record breaking, deal. The reason for that is timing, and economics.
The University of Washington is on the path of becoming a premier sports school. Not only has the football team seen meteoric rise due to Chris Petersen’s leadership, but the work of Mike Hopkins with the basketball team has the program on a path to success. Alongside the women’s volleyball team’s success over the past decade, this school is a prime spot for branding.
On the other hand, enter Adidas. They’ve made it clear that the company would like to significantly increase their market share in the United States to at least 15 or 20 percent. This is due to the fact that Nike remains the Goliath with a firm grip on athletics market share. While there isn’t a war brewing between the two brands, Adidas needs to battle at some point, and there’s no better place than to start in the Northwest.
In fact, per dawgman.com, the Adidas campus in Portland has already been decked out in Purple and Gold. The big question remains as to what the dollar amount will look like when pen meets paper.
Adidas had somewhat recently signed with schools like Louisville and Miami, and both of those contracts had paid about $8 million per year. Given the University of Washington’s success and Nike awaiting to counter anything Adidas could offer, the new UW deal should clear $10 million per year, easily. In short, I’d expect to see Adidas to win the contract with the University of Washington at $15 million per year for five years.
That kind of prediction doesn’t seem that big, especially compared with the deal that Under Armour made with UCLA at $280 million over 15 years. This deal is huge when compared to other deals made at the collegiate level, that it’s probably going to be seen as the huge outlier. I don’t see Nike and Adidas being that desperate to go $20 million per year.
A deal that’s a little shorter for UW will also allow the school to essentially bet on itself on the success it should see in the coming years. If basketball, volleyball, and football remain effective, why would the school settle for anything long-term?
Developments on this story have been relatively slow, but once the school’s representatives make the deal, there will be huge cause for celebration on Montlake.
