Where is NIL heading? What will change and what will continue to grow in the NIL landscape?
Since 2021, NIL has grown into a $1 billion industry. Within the next five years, NIL is expected to reach $5 billion. The growth of the industry is fast and furious but the regulations and structure around NIL continue to lack a clear direction. In this chaotic landscape, we see dire headlines, and occasionally, we get a story like UNLV quarterback Matthew Sluka that opens the floodgates of dialogue around NIL reform and guardrails.
There is no doubt that the NCAA and legislators will establish regulations that begin to rein in the chaos that has engulfed the industry. Uncertainty is and will be a constant in NIL. However, Just because the industry is evolving, does not mean that it is going away. So that begs the question: where is NIL heading, what will change, and what will continue to grow in the NIL landscape?
Matthew Sluka is one of many players who has been taken advantage of by the vague-ness of NIL policy. Nefarious actors are prevalent in NIL - making false promises and misrepresenting the truth behind resources available to players. These actors, both individuals and entities, that exist to identify and pass along capital to players or recruits will face necessary scrutiny and attention in the coming years. There will be a crackdown on how funding is promised, delivered, and reported from these entities/individuals to athletes. Where does that leave NIL?
The area of NIL that will be resilient in the coming years, free from a majority of uncertainties of regulatory changes, will be athletes independently making contracts with brands/businesses. True name, image, and likeness work constitutes an athlete’s payment for marketing from a brand or business. Athletes, just like creators, models, and influencers, will continue to be able to exchange their name, image, and likeness within clear marketing deals. This is no different from an independent marketing agreement made between business and individual.
We are seeing evidence of this in the courts outside of the NCAA where judges are ruling that high school athletes like Faizon Brandon from North Carolina can make NIL deals prior to entering college without jeopardizing their future eligibility. This kind of ruling continues to push a needed and necessary narrative in the world of sports: antiquated policies of amateurism in sports only limit personal financial freedoms.
NIL is helping reverse this trend. While certain elements of the NIL landscape will surely change, brand work with athletes will only expand and will expand rapidly. Athletes are creators and most college athletes are micro influencers with dedicated followings. As we look at the larger picture, micro influencer marketing will be a $30B industry by 2030, and athletes are the single most effective brand ambassadors for micro influencing marketing spend (athletes see a 1.3x user engagement for micro influencing deals compared to non-athlete influencers).
This is where Dealiyo is positioned to help lead the charge. At Dealiyo, we are empowering athletes to work directly with businesses to create those micro influencing deals. We are laser focused on the resilient part of the NIL market, and we are eliminating the major pain point of business and athlete deals to-date. That is a sustainable business model and an approach for long-term success.
Sources:
https://www.paymentlabs.io/blog/compliance-security/amateur-athletes-enter-the-marketplace#:~:text=The%20NCAA%20legalized%20NIL%20payments,and%20wide%20for%20local%20athletes
https://apnews.com/article/unlv-sluka-what-happened-5237f0dba1c523d2d0e74523c7f64a4e
https://news.bloomberglaw.com/daily-labor-report/ncaa-athletes-left-exposed-as-efforts-to-tighten-nil-rules-stall
https://www.wsj.com/sports/football/jaden-rashada-florida-nil-lawsuit-ee2f5441?st=n5d25fa08sa93ut&reflink=article_copyURL_share
https://apnews.com/article/nil-lawsuit-north-carolina-faizon-brandon-ad3214a5f4298b27858a50284364e19d
https://influencermarketinghub.com/influencer-marketing-statistics/
