NIL is a common term for the collective rights that allow people to control the commercialization of their identity, most commonly via an endorsement deal. NIL has always been one of the least understood areas of branding. Both companies and experienced, wealthy athletes have frequently gotten into trouble as a result of endorsement deals. Now, a recent decision by the US Supreme Court held that college athletes can earn money from their NIL. Adding this inexperienced group to the mix of people that can enter NIL deals will almost certainly lead to issues.
Companies have always had many concerns in NIL deals. In addition to money, duration and scope, there are also concerns regarding whether the endorser will uphold the brand image, or otherwise be a good brand ambassador. Some issues are unavoidable, such as when Reebok promoted “Dan versus Dave,” a head-to-head match up of two US decathlon athletes, for months before the 1992 Summer Olympics– and then Dan didn’t make the team. (Catching Up With Dan And Dave (cnbc.com).) Others are avoidable, but not viewed as a moral wrong, such as when David Beckham endorsed Brylcreem, and then decided to shave his head. (Brylcreem gets greasy as Becks tells his story – Marketing Week.) Some issues seem personal, like when Lebron James used social media to criticize the Samsung product he endorsed. (LeBron James tweets Samsung phone fail, then deletes it | Fox News.) Finally, sometimes the athlete becomes downright untouchable, like when many companies dropped Tiger Woods after news broke about his marriage infidelity. (Tiger Woods loses Gillette endorsement. Will 2011 be a turning point? – CSMonitor.com.) While our firm can’t prevent athletes from being human, we can counsel companies to make sure they are covered for all of these situations.
College athletes have many potential pitfalls in NIL deals. The biggest concern of course is that they sign away too much rights, and lose the ability to enter future deals when their “brand” is more valuable. They also have the concerns that even highly counselled celebrities, such as when Kawhi Leonard lost his KLAW logo to Nike. (Kawhi Leonard loses copyright lawsuit against Nike – Sports Illustrated.) Finally, college athletes have to worry about losing their scholarship and their ability to play on the very team that makes their NIL valuable.
Initiating Protection can help any party in a branding deal. We can draft or review an endorsement (or similar) agreement, advise on developing a branding strategy focused on NIL, consult on potential risk to scholarships or any other legal service related to NIL and branding.
Is your brand properly protected?