Show me the (holistic, long-term) money!
How one of the NFL’s newest recruits is pioneering a new path…
Marvin Harrison Jr. is breaking new ground for National Football League (NFL) athletes with his recent decision to withhold the signature of the National Football League Players Association’s (NFLPA) pro-forma general license agreement (GLA), a document that governs the league’s partnership with approximately 80 brands and corporations. Harrison Jr., son of Hall of Fame receiver Marvin Harrison, was drafted fourth overall in the 2024 NFL Draft by the Arizona Cardinals, commanding a projected rookie deal worth $US34,000,000 (according to estimations from Front Office Sports). Heralding from a successful household intimately familiar with the commercial and athletic realities of the NFL, Harrison Jr. is proceeding (in the infancy of his professional career) both without agency and with a holistic approach to commercial negotiations. While standardised contracts such as the GLA are aimed at improving the athletic experience through the provision of passive income, Harrison Jr.’s actions serve as an important reminder for professional and collegiate athletes alike to remain vigilant in contemplating the particulars of a deal with a holistic athletic approach in mind, rather than the glow of immediate financial gain.
The NIL predicament
The NFL draft stands as one of the most anticipated days of the year for many, filled with glitz, glamour, and ample drama. For 257 individuals, it marks the culmination of years of hard work and the realization of a lifelong dream—to join and compete among the elite while securing financial freedom for themselves, their families, and friends. With many collegiate athletes hailing from impoverished backgrounds, the NFL (and its sponsors) serve as a beacon of hope for many seeking financial stability.
Acknowledging these realities, and also acknowledging the substantial contributions athletes make to the NCAA (which recorded $1.3 billion (USD) in revenue for FY22/23), the NCAA relaxed its strict prohibition on collegiate athletes profiting from their name, image, and likeness in 2021. Against this backdrop, Harrison Jr. inked a four-year, $1 million (USD) deal with Fanatics Inc. in his sophomore year of college at Ohio State University. Fanatics, a global sports merchandising and memorabilia group now valued at over $31 billion (USD), is the preferred affiliate for sporting merchandise across North America, with licensing agreements with the NFL, Major League Baseball, National Basketball Association, and National Hockey League. Fast forward two years, and now assuming a more holistic approach toward his athletics, Harrison Jr. is actively seeking to rework his existing Fanatics deal on the simple premise that the value ascribed to him as an NFL rookie far outweighs his ‘collegiate value,’ which resulted in the associated payment terms of $1 million (USD).
As mentioned, Harrison Jr. hails from a successful and wealthy household. The enticement of a $1 million (USD) payment amount is perhaps not as great as it would be for another athlete from a less privileged upbringing. Consequently, the commercial approach to evaluating the Fanatics deal differs for Harrison Jr. There can be no suggestion (based on the readily available information) that Fanatics actively sought to exploit Harrison Jr. out of his NFL rookie value. Rather, an objective analysis of the deal suggests prudent foresight from Fanatics’ executives who anticipated Harrison Jr.’s rookie value and secured his rights at a sophomore price. While the lure of a $1 million (USD) payday is undoubtedly enticing for collegiate athletes, commercial arrangements such as these serve as a timely reminder for all athletes to remain diligent in considering their holistic value when negotiating terms. Such examples include:
implementing ratcheting mechanisms for the renegotiation or independent evaluation of ‘market value’ if payment value is contingent on the player’s current market standing;
extending payment terms to allow for greater financial stability; and
incorporating termination for convenience rights.
Although complicating proceedings in finding his holistic approach after the execution of transaction documents, Harrison Jr.’s recent position serves as a timely reminder for athletes to thoroughly contemplate the holistic aspects of any athletic or commercial agreement.
Money talks in the big leagues
Wins and losses come a dime a dozen in the NFL. It’s the nature of football. One team in the league’s history has enjoyed an undefeated season—the 1972 Miami Dolphins. Since then, no team has ever remained undefeated at season’s end (and hoisted the Lombardi Trophy). With the pressures of high-performance football greater than ever, Vince Lombardi’s famous words—‘winning is not everything—but making the effort to win is’ resonate deeply. But—when push comes to shove—the NFL is a business. The NFL does not harness the same grassroots obligations as Rugby Australia or the Australian Football League merely by way of its private incorporation. It is not to say that the NFL does not prioritize its community and international promotion pathways—because in recent years, its efforts to do so have set a global benchmark for administrations alike to envy. But the NFL’s primary purpose is to ‘deliver the world’s most exciting sports and entertainment experience.’
Against this backdrop, we see 31 private owners enjoying the fruits of their hard labour and commercial investment, with the average club value more than doubling from 2016-2023 to an average of $5.11 billion (USD). Given the privacy of ownership structures (save for the Green Bay Packers), the rapidly accelerating values of NFL clubs bring well-earned rewards but equally daunting commercial considerations with a dwindling population of suitable purchasers (with the potential for 10 NFL clubs valued at over $8 billion (USD) to appear on the market in the next 10 years) and looming estate taxes. The point? Football isn’t everything in this league. After all, the NFL is an ‘entertainment experience’ too.
With good intentions and in order to try and assist players in capitalising from commercial opportunities, the GLA allows athletes to license their name, signature, number, etc., to over 80 brands and companies, including Nike, Fanatics, and Electronic Arts. Intended to be a self-serving agreement, the GLA serves as an opportunity for athletes to enjoy a form of passive income from the use of their NIL. The appeal from a commercial standpoint for players is the convenience of the set & forget nature of the GLA with a multitude of revenue streams ensuring athletes see profits across the year (dependent on the stature of the athlete’s following). Unrepresented, Harrison Jr.’s withholding of the signature on the GLA has a substantial flow-on effect for the NFL and proponents alike—with Nike unable to manufacture his jersey and Fanatics not currently licensed to sell it (Harrison Jr.’s current Fanatics contract deals exclusively with memorabilia).
Of course, the leverage for Harrison Jr. is notable with ample lead time in preparation for the eventual signing of licensing deals, which will open the metaphorical flood gates on consumer purchases of all things ‘Marvin Harrison Jr’. While a commercially risky move, the option to withhold the signature on the GLA also serves as a solid commercial position for future high-profile athletes to consider by actively seeking to negotiate individual, personalized contracts on more favourable terms. It is not to say the lower-end athlete should withhold the signature on the GLA in the attempts to negotiate heavy-hitting contracts with Nike and Fanatics—because the terms of the GLA are hardly unfavourable. But what Harrison Jr.’s actions demonstrate is the leverage a high-profile prospect has in actively adopting a holistic approach to sponsorship and seeking out personalized deals with individually favourable terms.
Holistic Athletics
Historically and as part of the NFL draft process, players participate in the NFL Combine—a showcase where athletes demonstrate their speed, strength, and on-field skills in a practice setting in front of team representatives. Harrison Jr. did not participate. Further, schools and players have a secondary opportunity to showcase their talents at their ‘pro-day’—an open workout with scouts in attendance. Harrison Jr. did not participate. He instead insisted that teams rely on the wealth of film and previous training sessions to evaluate him as an NFL prospect, rather than committing to a rigorous off-season training regime to prepare for the NFL combine and pro-day. While this decision may have ruffled feathers among teams, Harrison Jr.'s approach reflects a sensible, holistic choice after nearly three years of high-performance collegiate football. The NFL combine and pro day—much like upfront payment collegiate NIL deals—have their time and their place. But athletes and agents alike should be aware of the holistic precedents set by Harrison Jr. in recent months both on the commercial and physical preparation arms of the game.
Takeaways
While the NCAA and associated NIL guidelines continue to navigate their teething issues, unrepresented collegiate athletes ought to remain vigilant in their due diligence of any contractual terms put to them by potential sponsors. Considerations should include items such as payment mechanisms, term & termination, indemnities, warranties, and flexibility. Sponsors are not in the business of exploiting collegiate athletes—because they know their value and the importance of keeping them onside in the years to come. But, and somewhat sensibly, they are not in the business of overpaying unnecessarily straight out the gate. That’s just bad business. Which is why the athlete ought to ensure they assume a holistic and diligent approach to their negotiations.
Further, professional athletes ought to employ similar approaches when considering the suitability of generic unionized deals and potential concessions associated with them. It may be the case that in employing a holistic and diligent approach, an athlete may be able to strike personalized and more favourable terms.