Thinking Big: College Deals Going Campus Wide
Wed, 01/16/2013 - 09:41 — AJ Maestas
For many years, college athletics were my greatest love as a fan and my greatest frustration as a professional. I always preferred a Saturday of football to a Sunday, but I wanted to see schools catch up to pro teams in terms of business operations, specifically as it pertained to sponsorship revenue generation. Early in my career, there was virtually no research or strategy in college athletic sponsorships, and most universities were still selling things like naming rights to donors for pennies on the dollar. In the past decade, many athletic departments started getting smarter, as a new generation of athletic directors began to see the true value of their inventory – especially with naming rights and multimedia rights – and began to pursue that revenue. As great as those strides were for the industry, an even newer day is dawning now in the college space and its potential is enormous. I’m talking about the campus-wide deal.
Whereas athletic sponsorships include a variety of assets that will primarily reach fans of a school’s football and basketball teams, campus-wide sponsorships can reach all students, alumni, faculty and employees, providing an incredible reach for the partner. Of course, many campus-wide deals still include athletic assets, thereby reaching the passionate sports fans that are so valuable. But these deals also utilize numerous pieces of inventory throughout the campus, and not just traditional signage or media. Many can include inventory that is integral to campus life, such as student IDs (an example I’m about to cover), and many can cover categories like telecom or energy or insurance, which involve procurement and in-kind trade and are budget relieving. These deals are truly the future of college sponsorships.
One example we worked on at Navigate was Arizona State’s banking deal, which was signed this past summer. The university already had an athletics sponsor in MidFirst Bank, but it saw the possibility for more and both sides realized that a campus-wide partnership could be mutually beneficial. Together, they created a deal that gave MidFirst Bank a larger presence within athletics and a dominant presence on campus as a banking option for students. The primary asset of this new package is the aforementioned student ID cards, which can now also be MidFirst Bank debit cards. For the bank, the benefit is obvious – access to students as they begin the transition to adulthood, which includes developing a brand preference in banking. For the university, there is revenue for each new student account in the first year ($15), revenue for each account in additional years ($2.50 per year), and revenue each time the card is used for a purchase ($0.04). That has the potential to add up at the nation’s largest university by enrollment.
Arizona State is not alone in pioneering these campus-wide deals. Several other schools [Navigate is currently working with more than 3 BCS schools] are also working on partnerships across their campuses, and some of these long-term deals have the potential to reach a total of nine figures. With budget shortfalls across the country forcing colleges and universities to actively seek new revenue streams, it seems inevitable that many more schools are soon to follow. The beauty of this is that academic institutions are meant to foster innovation, and the most forward-thinkers – many of them from athletic departments – are now getting a chance to shine. Very soon, they will be the ones rising up through the ranks at their respective schools, and the days of colleges remaining behind the pros will be behind us.