Nike Steals $6 Million Opportunity From Kalen DeBoer’s Alabama Football and Others With Latest Move

Kalen DeBoer & Co. are gearing up to face new trouble from sports apparel giant Nike. And by that, we don’t mean just the Crimson Tides but a bunch of other schools too. 

According to the latest buzz, Nike is tightening its grip on how college teams can generate revenue. For years, teams like Alabama have made millions by selling jersey patches. Sportico even reported that Kalen DeBoer’s team is one of the top earners, bringing in a whopping $6 million from this side revenue. But now, Nike seems to be planning to cut off this lucrative opportunity with their latest move.

On August 30th, Yahoo Sports reporter Ross Dellenger dropped a bombshell: “In an email Friday sent to school & obtained by @YahooSports, apparel giant Nike reinforced that 3rd-party sponsorship patches to game/practice uniforms are prohibited under Nike contracts.” He later clarified that Nike’s stance is that no third-party patches or logos can be applied to any Nike products without their approval beforehand.

Well, it’s not surprising that Nike wants to control who shares space on their apparel, considering the money they invest for that prime spot. However, banning other brands outright could be challenging, given that patch sales have become a booming income source in college sports. While Kalen DeBoer’s Alabama leads in patch sales, other colleges together make an average of $4.6 million from this business. Clearly, it’s a thriving revenue stream!

Now, colleges are always trying to see more money, and sponsorships on the field seem like an easy way to do it. So, Nike’s decision can haunt a lot of such ambitious schools. Especially with new rules coming from the NCAA coming into the mix, things are taking a new twist. 

Kalen DeBoer & Co. in the crossfire

Pro leagues like the NBA are already at the top of their game, making big money with jersey patches. This year, the NCAA finally gave its nod to college football programs to have corporate sponsorship on jersey patches. Now, this could be bad for Nike, because other corporate giants would get the ‘attention spot’ or rather ‘patch spot’ on Nike-sponsored jerseys. After all, Nike supplies apparel for around 60% of college football teams, including Kalen DeBoer’s Alabama and Coach Prime’s Colorado. Even DeBoer’s in-state rival, Auburn, is set to switch from Under Armour to Nike in 2025. Amidst all this, Nike made this new bold move. That too, with NCAA rule changes on revenue sharing system making their way. 

As Ross Dellenger posted, “Under the House settlement agreement, schools will be permitted to share 22% of certain revenue streams with athletes. One of those revenue streams does include sponsorships.” Now, the NCAA already requires colleges to share profits with athletes for deals made through them, with teams still owing about $2.8 billion in the latest House vs. NCAA case.

With that, Nike’s move could impact this system, reducing sponsors for jersey patches. We’ll have to wait and see how all of this plays out now that the rules are changing.