Although the money certainly helps.
U of Cincinnati leaving adidas, signing deal with Under Armour. Will go from getting $1.5M/year in cash & product up to as much as $5M/year.— Darren Rovell (@darrenrovell) January 21, 2015
That five million dollar figure is monumental for a school that is searching for ways to supplement its former lifestyle in trying circumstances. This contract, along with the continued disbursement of the Big East buyout funds, the new revenue streams from the Nippert expansion and this contract will help to that end.
Now, and you are not going to believe this, there are some discrepancies with Rovell's numbers. The Portland* Business Journal maintains a database of agreements and contracts between the apparel giants and major colleges. The PBJ values UC's Adidas deal at 2.6 million dollars. The discrepancy in the numbers comes down to one thing, the database values the apparel and equipment at retail prices rather than at the wholesale level. The 1.5 million Rovell quotes is based on the wholesale price of the apparel portion of the contract. So technically both are right, but they aren't really talking about the same thing.
* Adidas's US headquarters are in Portland, Nike's posh spread is infamously in Beaverton, a Portland suburb. Under Armour is headquartered in Baltimore.
The Bearcats new deal with Under Armour will be one of the 15 or so most lucrative contract's in the country. If Rovell is right on the five million dollar figure UC's deal will be more lucrative than any Nike contract from this past year. Based on that same data the UC deal will be the biggest non Notre Dame contract on Under Armour's books, though Auburn's and South Carolina's contracts are up in the summer of 2016. If UA can keep them, it will come with a big, big raise likely well above what Cincinnati will get.
Perhaps even more interesting than that is the Adidas side of the story.
Adidas says leaving Cincy deal comes from review "to ensure (deals) are meeting our investment." UA willing to pay big $— Darren Rovell (@darrenrovell) January 21, 2015
Now compare that with the statement from Adidas on learning that Notre Dame was leaving the three stripes for Under Armour.
In a statement that noted its 17-year partnership would come to an end after this school year, adidas said, "As with every business decision, we weigh our investment against the value to our brand."
The statements are not the same, but the meaning is.
I am not saying that Adidas is doing something wrong....but Adidas is totally doing something wrong. How can you say that a school that has seen their take from licensing royalties skyrocket from a little under 5 million dollars in the fiscal year ending June 2005 to over 18 million dollars* in the fiscal year ending June 2013 isn't providing value for the 1.5 (or 2.5) million dollars they shell out in cash and equipment?
* According to the USA Today College Finances Database
Because for Adidas it probably isn't worth it to them. The rapid rise in sales of UC branded things is about a couple of things, one is that UC has been pushing hard to expand the brand beyond the I-275 loop.
That has been a huge success obviously, and most of that expansion has happened in the last five years. When I moved to my hometown of Norwalk, Ohio in 2010 it was impossible to find anything UC branded within 100 miles. Now I can go to the local mall and find UC stuff in two or three different stores. The selection is terrible compared to what I found when I went back to Cincinnati, but UC gear does exist here when it didn't just four years ago. That's progress.
The other point to be made about Adidas is that not everything you find in stores bearing the three stripes is actually made by Adidas. I would hazard a guess that most of the products you find bearing the three stripes is made under license, more often than not by the big box retailer you are buying it from.
That isn't to say that Adidas doesn't make their own stuff for UC fans because they do. I have an Adidas light sideline jacket that is a good product and that I love. I have a couple of climalite T-shirts that I really like and I have a cotton shirt with a retro feel complete with the old Adidas logo that is awesome. But those are the four things I own that I know Adidas made. I have a dozen other shirts bearing an Adidas logo that I know were not actually made by Adidas. They were made under license by some other company and the quality isn't as good because of that.
As I person who works in retail I often get asked what the difference is between Nike/Under Armour and the cheaper Adidas/Reebok apparel. For a long time I did not have a good answer to that question, so I have spent some time, perhaps too much time thinking about this particular subject. It really comes down to quality.
Nike and Under Armour control every single aspect of the design, marketing and most importantly the production of their products. From the selection of the fabrics involved right on through to the completion of the garment they have an input. Because they control every step in the process they are better able to maintain a standardized level of quality than their counterparts are. They simply make products that are of a higher quality than you find from products made under license.
That is why I will not be sorry in the least to see the back of Adidas. The three stripes were very, very good to the Bearcats over the better part of a decade, very good indeed. But I never fell in love with their stuff the way I did with this and later that. I look forward to seeing what Under Armour does with the UC brand, and finding out whether or not I can love again.