Penn State's Potential Switch to Adidas Could Boost NIL Funding Significantly

Tennessee in mid-August announced a 10-year apparel partnership with Adidas, becoming the latest college program to make the switch. Yahoo Sports reported that the deal could be worth $10 million annually. Danny White, Tennessee's athletic director, did not confirm that but told Yahoo Sports that it's “one of the biggest apparel deals in the history of college sports.” He also said NIL was "at the forefront of my mind" when negotiating.

This is what Kraft and Penn State are negotiating as well. Embedded in Tennessee's contract with Adidas is cash for the Volunteers' NIL initiatives. Tennessee also said in a news release that Adidas "will offer unprecedented NIL opportunities" for Tennessee athletes. This quote from an Adidas representative should resonate with Penn State football fans.

"The role of a college athletics sideline partner has changed dramatically in the 11 years since we last partnered with Tennessee Athletics," Chris McGuire, adidas vice president of sports marketing, North America, said in a statement. "Adidas is establishing a new standard for investment in NIL with this partnership that will sustain UT's powerful athletics program as the university continues competing for championships for years to come."

If Adidas make a substantial NIL investment in Penn State, that would significantly impact a program whose NIL initiatives have been uneven since 2021. It also would help Penn State lower the ask of fans, who have shown reluctance to donate for NIL at the levels of its competitors.

“I think people are still very skeptical about where the money's going,” Jen Ferrang, former general manager of the Happy Valley United collective, said in a 2024 interview. “Some of the reaction is, ‘Hey, I really spend money with the Nittany Lion Club, I donate for scholarships, I donate to THON, why do I need to do this?’ And people still seem to be feeling like they're spending too much money or they're not making the direct connection between winning and their donation.”

According to On3, which broke the Penn State-Adidas story, the contract includes a "significant" NIL component. Which is a significant reason for the switch. Penn State won't have to rely on fan donations with Adidas chipping in money.

Certainly, there's history between Penn State and Nike. The company has outfitted Penn State since 1993, when the Nittany Lions joined the Big Ten. According to Brad "Spider" Caldwell, Penn State's former football equipment manager, the program took a real risk in signing with Nike and logoing its jerseys then.

Now, the risk involves allowing other major programs to outfinance Penn State further. Kraft addressed this publicly in early August as he negotiated the Adidas deal in private.

"I am excited for this new era of NIL" Kraft said. "The college enterprise has changed. When I first was here, the NIL debate was going on hot. It was back and forth. And our base has really opened up and understood where it is and where we need to be. I am really optimistic and I believe we are positioned as good as anybody in the country because of our power. That Penn State power is real. ... We are now just tapping into it."