Student Athletes Eligible for Endorsement Fees/ Fight for Compensation and Benefits

In October 2019, the state of California passed the Fair Pay to Play Act, under which all student athletes are free to accept contracts for payment for use of their names, images or likenesses (NIL). In June 2021, the U.S. Supreme Court unanimously ruled that NCAA limits on college athlete compensation violates U.S. antitrust law. The ruling opened the door for U.S. states to decide when and how athletes may sign endorsement deals with third parties. The ruling also allows colleges to recruit athletes by offering education-related compensation such as scholarships for graduate or vocational schools, computer equipment and study abroad programs in addition to limited cash awards (expected to be around $6,000).

The NCAA officially changed its policy regarding student compensation in mid-2021. Students may employ agents to assist them with contract negotiations. In fact, consulting firms such as Opendorse and MatchPoint have launched to handle student endorsement deals.

Businesses, from restaurant chains to sporting goods manufacturers to internet providers, big and small, are signing deals with student athletes in droves. Deals range from six-figure endorsement deals between national brands and star athletes from big schools to local businesses hiring community college athletes for small marketing campaigns (including social media promotions) in exchange for small fees, free products or gift cards.

In 2022, after winning the NCAA men’s basketball title, the Kansas Jayhawks team went on a six week “KU Basketball Barnstorming Tour,” earning a collective $1 million for signing autographs, auctioning memorabilia and performing shoot-arounds. The tour was organized by a sports collective, a business with no connections to the University of Kansas or its athletic department. According to the Business of College Sports, 37 of 65 schools in the five wealthiest athletic conferences have at least one collective.

On the small end, The Vitamin Shoppe (a nutritional supplements retailer with about 800 outlets in the U.S. and Canada) worked with OpenSponsorship (a sports marketing consultancy) to find 14 college athletes from a variety of different sports to promote products on social media. Each athlete was compensated with about $100 worth of free products such as performance supplements and Vitamin Shoppe shake bottles.

Meanwhile, in June 2023, the California State Legislature passed the College Athlete Protection Act, which, if fully enacted, would require college sports programs to share their revenues with the athletes. This could include minimum pay plus benefits. Per the act, player’s incomes would be based on a formula where one-half of a pool of funds is set aside for male athletes each year, and the another half set aside for females. The money would then be distributed (above a baseline and after the cost of scholarships is deducted) along complicated lines, depending in part on which programs generated the money.

Payouts-per-player could be very substantial, particularly at schools with massive television rights income. Up to $25,000 per player would be paid out promptly, with the balance set aside until the players complete their college degrees. The NCAA threatened to boycott California schools if the legislation is eventually passed. Whatever the outcome, this is likely only the beginning of intense, U.S.-wide activism for payments to athletes. On the downside, college athletic programs state that the law would cut deeply into school funds available for less popular sports, such as fencing, that prepare athletes for Olympic events.

Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. Excepteur sint occaecat cupidatat non proident, sunt in culpa qui officia deserunt mollit anim id est laborum.

Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. Excepteur sint occaecat cupidatat non proident, sunt in culpa qui officia deserunt mollit anim id est laborum.

Become a Plunkett Research Online subscriber to gain unlimited access to our massive amount of vital industry data and market research.

✔ 100,000 Industry Statistics
✔ 500 Industries Analyzed for Market Size, Profits and Forecasts
✔ 150,000 Industry Executives Profiled
✔ 25,000 Companies Profiled, Ranked and Analyzed
✔ 1,000 Vital Trends Analyzed, totaling 1,000,000 words

Learn More

Student Athletes Eligible for Endorsement Fees/ Fight for Compensation and Benefits, Business and Industry Trends Analysis

A Representative List of Organizations that Have Used our Research and Products:

How to access Plunkett Research data.

What data challenge can we help you solve today?

Take a Tour

Contact

Testimonials