Education

UI seeking marketing deal to grow revenue

An existing athletics contract could serve as a blueprint

Through a lucrative athletics marketing deal for the University of Iowa, partners are able to brand a wide array of gear and facilities. Here, Iowa Hawkeyes teammates react on the “Mediacom Court” as the clock runs out Jan. 23 during the fourth quarter at a game with Rutgers at Carver-Hawkeye Arena. The athletics deal could inspire a broader marketing effort across campus. (Rebecca F. Miller/The Gazette)
Through a lucrative athletics marketing deal for the University of Iowa, partners are able to brand a wide array of gear and facilities. Here, Iowa Hawkeyes teammates react on the “Mediacom Court” as the clock runs out Jan. 23 during the fourth quarter at a game with Rutgers at Carver-Hawkeye Arena. The athletics deal could inspire a broader marketing effort across campus. (Rebecca F. Miller/The Gazette)
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IOWA CITY — University of Iowa athletics over the past dozen years has made tens of millions of dollars off a multimedia marketing rights agreement, and now the broader campus — facing a shifting revenue landscape — is looking to replicate that success.

Earlier this month, UI issued a call for proposals from “experienced, financially sound, responsible, and forward-thinking marketing” suppliers interested in providing a “comprehensive and cutting-edge campuswide marketing program.”

The program would provide “creative opportunities for parties interested in developing a marketing relationship with the University of Iowa” through branding and partnerships. It would not be about advertising to the public as much as it would be about capitalizing on the UI brand by collaborating with corporations or entities interested in harnessing the university’s marketing power.

Consider a current UI collaboration with Coca-Cola that lets the corporate giant station vending machines on campus — generating revenue that UI officials say benefit students, faculty and staff. Or UI athletics’ move in 2011 to allow its multimedia marketing partner to facilitate sponsorship of the Carver-Hawkeye Arena floor.

Thanks to that deal, the Carver surface earned the label “Mediacom Court” for basketball and volleyball events and “Mediacom Mat” for all wrestling events — and boosted athletics revenue.

Expanding that concept to the campus as a whole, however, touches on concerns some critics raised upon the 2015 hiring of former IBM executive Bruce Harreld as UI president — that public universities, with state budget support eroding, would become increasingly commercialized in their efforts to make ends meet.

UI officials declined to comment in detail about this request for proposals so as not to influence the pool of prospects.

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Harreld repeatedly has cited a need to diversify revenue streams as student demographics change and lawmakers have curtailed support for higher education.

In a spring semester message to campus, for example, Harreld stressed that through “creativity, collaborative spirit, and relentless determination, the University of Iowa will determine its own future.”

“Together over the past three years, we’ve developed a new, transparent budget model, our board has committed to a predictable five-year tuition plan, and as a campus we have been exploring every opportunity to align our resources most productively with our mission,” he said in the message. “When we decide we need to do things differently, we aren’t being frivolous or fashionable — and our strategic plan for the university is not based upon hope but rather excellence.”

A campuswide multimedia marketing rights agreement would be the first of its kind for UI, according to spokeswoman Jeneane Beck.

The UI Athletics Department since 2006 has held a contract with Learfield Communications, granting it exclusive rights to sell advertising, for example, at games, during weekly coach shows and on ticket stubs, news conference backdrops, seat cushions and press boxes.

The athletics contract, which has been extended through 2026, grants Learfield exclusive rights to all revenue-generating opportunities on the UI athletics website. It grants it the right to sell ad space on game programs, electronic signage inside Carver and Kinnick Stadium, concourse displays, coach headsets, souvenir cups and the field goal nets.

The university, according to its contract with Learfield, “will encourage its coaches to cooperate with Learfield should Learfield need to obtain an endorsement that is beneficial in maximizing the income from the rights granted under this agreement.”

The contract grants Learfield the right to sell sponsorships for “announcements, messages, and videoboard displays on existing public address, scoreboards, or videoboards including but not limited to, out of town scores, trivia, statistics, features, segments, replays, commercial logo branded messages, contests, birthday and/or fan greetings.”

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For such expansive rights and brand access, Learfield pays the UI an escalating “guaranteed rights fee,” which started at $4.9 million in the contract’s first year and has grown to $6.9 million in the current year. It’s scheduled to reach $8 million by the contract’s final year in 2026.

The total amount amassed from just the guaranteed fee portion of the Learfield contract since its inception tops $76 million, according to contracts and extensions provided to The Gazette. And that doesn’t include additional proceeds afforded UI for good athletic performances — like bowl game appearances — and gross revenue generated over an annually-increasing threshold.

Learfield must pay the university half of all annually-collected gross revenue above $12.3 million in the current year. That will bump up to $14.6 million in the contract’s final year.

The goal of a broader campuswide marketing rights partnership is explicit in the new request for proposals, which are due Feb. 8.

A chosen firm should, according to the document, “secure, develop, maintain, and grow both new and existing strategic partnerships” in the aim to “increase revenue, student/faculty/staff recruitment and retention, as well as engagement of university alumni.”

In addition to partnerships for advertisements across multiple media platforms like radio, TV, social media and periodicals, the new media rights collaboration could establish a preferred retail bank or credit union; use of retail space; and promotional products and events.

But the university, in its request for proposals, is careful not to close doors or too specifically define its intentions.

“Suppliers are encouraged to propose additional concepts of branding and partnerships to help demonstrate areas of opportunity and supplier’s unique insight into promoting the university,” the UI document says.

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In response to a question for more details of what the university is looking for, administrators noted any of its preconceived ideas should be “just a starting point.”

A chosen firm should expect to work not only with the main UI campus but with the UI Hospitals and Clinics and athletics, according to the UI documents. Primary UI partners would include its external relations department, career center and alumni foundation.

Although the UI request for proposals is explicit in noting that advertising and partnerships with tobacco firms or products are barred, it suggests a willingness to collaborate with casino hotels “that do not directly promote/associate participation directly in gambling.”

The university hosted a pre-proposal conference last week, allowing interested firms the chance to ask questions. The university didn’t disclosed the names of those that participated, but Beck said six people attended from two companies.

On-campus presentations tentatively are scheduled for the week of Feb. 25, in hopes of awarding a contract the week of March 4 to become effective March 11. Bidders have to — in conjunction with their proposal — pay the UI 5 percent of the total price bid for the contract’s first year.

“Bid security is something we use to ensure vendors are committed,” Beck said. “The outcome of this bid should result in revenue to the university and therefore, we only want serious bidders.”

Although UI hasn’t said whether Learfield was among the interested parties at the pre-proposal conference, the group has launched a “Campus+” program that builds off its existing athletics relationships — which includes Iowa State University and University of Northern Iowa — by cultivating “innovative, ‘best in class’ university partnerships.”

“Brand alignment, student-centric programs, campus impact and revenue growth are our four guiding principles for Campus+,” according to Learfield’s website.

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Sen. Jeff Danielson, D-Waterloo, said he sympathizes with the public universities’ need for alternate revenue sources and, in fact, called these types of public-private partnerships unavoidable with Iowa’s generational disinvestment in higher education.

“They are going to have to supplement their revenue,” he told The Gazette. “And I’m OK with them supplementing their revenue by using business enterprise partnerships.”

But he stressed the need for any partner to align with the values of the public universities, not the other way around. That means, for example, maintaining transparency about agreements and their terms and conditions.

“They still need to realize that when they sign up with partners, the values of a public university still need to be front and center,” Danielson said. “Not the values of the business you are signing on with.”

• Comments: (319) 339-3158; vanessa.miller@thegazette.com

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