A Challenge For Mid-Major Division I Schools

With news emerging that the NCAA’s Transformation Committee’s work may have hit a roadblock, Division I athletics directors and presidents still need guidance in order to prepare for the fast approaching changes. Savvy leaders are tracking several developing issues, including the new Big Ten Conference media rights deal (which some have projected will double annual institutional payouts to $100 million or more). Many are also planning for an expansion of the College Football Playoff to 12 teams, which could be a huge financial windfall for those conferences (and independents) who are part of that collection.

It can be overwhelming to track on all of these moving pieces, particularly if you are a Group of Five or other mid-major program. To help Presidents and senior campus leaders assess where your institution is currently, here is a checklist to begin comparing your institution’s readiness for this new landscape:

Multimedia content and digital assets

• Do you have a deep multimedia content staff? This has become so specialized that teams as large as 20 are staffing football and basketball programs alone.
• Is your athletic department prepared to assist all of your athletes in developing their full NIL potential? If not, you should be prepared for roster churning and lots of new faces every year.
• Has your institution developed a plan to leverage the evolving marketplace for NIL for all of your athletes? Do you have a large enough base of donors to make a difference in this space?
• Is your institution prepared for other emerging technologies that are driving engagement with Gen Z and the brands they are creating?

Analytics and Gambling Revenues

• Do you have the capability to leverage your data management via analytics of your season ticket holders, single game purchasers and other fans for monetization?
• Are you prepared to sell your data rights as part of a media rights package in order to improve your financial return? Does that include athlete’s personal biometric data? (do you have the legal authority to do so?)
• Are you prepared for the revolution around data and sports gambling? If your traditional media rights can’t keep up, have you and your senior leadership team had discussions around accepting revenues from gambling partners and selling data?

Traditional Media Rights

• Where are your traditional media revenues coming from? Is your conference anticipating an expiration and renegotiation of its tier one rights in the next 3-4 years? Do you even have a tier one rights deal?
• Is your football program/conference a part of the College Football Playoff expansion discussions?
• Are your conference revenues completely dependent on how successful your men’s basketball teams are in March Madness? Is that enough revenue?

Attracting the best staff and coaches and incentivizing them:

• Do your coaching and administrative positions attract candidates who are already at the top of their profession?
• Are the contracts of all of your head coaches structured to incentivize athletic success in the post-season?

When you hire a new athletic director, does his/her contract look like new Penn State Athletic Director Pat Kraft’s? Do you actively incentivize winning?

• $50,000 for winning Learfield Directors’ Cup
• $25,000 for placing in the Top 5
• $20,000 for placing in the Top 10
• $15,000 for placing in the Top 15
• $10,000 for placing in the Top 25

Football

• $100,000 for playing in a College Football Playoff semifinal
• $50,000 for playing in a New Year’s 6 bowl game
• $35,000 for playing in the conference championship game
• $25,000 for playing in a bowl game

Basketball

• $50,000 if the men or women play in the NCAA Final Four
• $35,000 if the men or women play in the NCAA Sweet 16
• $25,000 if the men or women win the Big Ten regular-season or tournament title
• $20,000 if the men or women play in the NCAA Tournament

Olympic Sports

• $25,000 for each team (other than football or basketball) that wins an NCAA title
• $10,000 if one or more teams wins a conference title

Academic Performance

• $30,000 for achieving an overall graduation success rate (GSR) of 92 percent
• An additional $30,000 for an overall GSR of 93 percent

Do your coach’s contracts include these items that Louisiana State University promised to their football coaches?

• Head Coach Brian Kelly will earn at least $9 million a year for 10 years, plus a $500,000 bonus for winning a CFP championship
• Defensive coordinator Matt House will earn nearly $2 million a year for three years
• Offensive coordinator Mike Denbrock will earn $4.2 million over three years

The total compensation for just those three positions over three years is $12 million. Some Division I programs don’t have a total athletics budget of $12 million.

Addressing athlete’s decisions to enroll and stay at your institution

• Does your program have an apparel contract that pays your program to wear the gear? (Not just a discount on the purchase price of uniforms and shoes)
• NCAA legislation passed in May allows for a floor of 85 full scholarships in football for the next two years. Will you have the resources to add dozens of new full scholarships for both men and women in order to comply with Title IX?
• Do you have the financial capability to maximize the full amount of the Alston awards ($5,980) for every athlete every year?
• Do you have a robust mental health program that can address the needs of all of your athletes multiple times throughout their careers on campus?
• Are you prepared to address the equity issues between men’s and women’s programs as women’s teams add more media exposure and revenues to your bottom line?

Finally, when the legal challenges to your conference’s decisions come (and they will), does your conference have the financial reserves to pay the legal fees that will inevitably arise?

For Division I institutions who are currently ‘outside’ of the Power 5, there are many more considerations to be included in their assessment of their athletic programs. Ask yourself: can your department be competitive in this new era of financial and athlete movement? While athletic success isn’t always about money and resources, those factors play a much larger role today. Group of 5 and mid-major leaders should be asking themselves how they will define success in this new era. It’s likely the most important question a President can ask.