ASU plays footsie with Nike

"That raises the level of awareness of your program in the marketplace in a way that you can't do as an institution."

White says many high school athletes prefer Nike apparel.
"The kids today are driven by brand identification, and it's only going to become more and more prevalent in that regard, in our view," says White.

Nike's marketing expertise and recruiting hook make the company irresistible to White and other ASU administrators.

So much so, the university has embarked on a path that essentially excludes any of Nike's competitors from continuing to supply athletic apparel to ASU teams.

White knew where to turn when it came time to secure an all-school apparel sponsor--to his old friend, Steve Miller, global director, corporate relations for Nike Incorporated.

The two, both former track coaches, have known each other for years.
Soon after White took the helm at ASU, he and Miller began discussing an all-school sponsorship from Nike. The talks evolved into a detailed plan that told ASU how it should prepare its formal request for proposals (RFPs). According to state contracting law, RFPs must be provided to all potential vendors.

The RFP was drafted to effectively exclude the dozen or so athletic supply companies that currently provide equipment and apparel to various ASU athletic teams, and none of those vendors responded to the proposal.

Only three companies--Nike, Reebok and Adidas--were capable of meeting the RFP's broad requirements to provide sports apparel ranging from football jerseys to women's volleyball shoes.

Of these three companies, Nike clearly had the advantage of having the RFP written to meet its requirements.

ASU records indicate that White carefully followed Miller's instructions, modeling ASU's RFP after a deal Nike had struck with the University of Virginia.

White laid out the ASU-Nike game plan in a March 17, 1997, letter to Kit Morris, Nike's NCAA relations director.

"Quite frankly, as you know, Steve [Miller] forwarded ASU the University of Virginia proposal which we were instructed to emulate," White wrote.

(In a taped interview with New Times, White denied ever reading the Virginia proposal and said, "I don't even know where it came from.")

White wrote that Miller "shared with me a Nike [office] computer printout" that showed Nike was paying from $700,000 to $1.4 million annually for all-school sponsorships.

White also wrote that "ASU was coached to pursue a financial package at approximately the mean ($1M) . . ."

Records show ASU issued its RFP on January 24, 1997.
The results of the RFP were not what White and ASU expected.
Champion Products, which supplies apparel to the football team, complained bitterly about the RFP--Champion believed it infringed on the company's existing contract with ASU.

"I would like to further express Champion's disappointment that as a long-term supporter and partner of Arizona State University that we were not given the courtesy of any verbal or written notice prior to receiving this proposal," Jeff Johnson of Champion wrote.

Only one manufacturer, Riddell All American, responded by ASU's February 13, 1997, deadline--and its response failed to meet ASU's goal of providing apparel for all its athletic teams and was rejected.

More significant, ASU administrators were shocked that Nike failed to respond to the RFP, which ASU had so carefully tailored to meet Nike's requirements.

White blamed Nike's inaction on the company's rapid growth, which he said made it difficult for anyone to make decisions. Another factor, White says, was that his primary contact, Miller, was transferred to Japan just before the RFP was issued.

"My reaction was that the company was so big, so cumbersome, and the one guy I felt was interested was no longer housed at their corporate headquarters," White says.

Despite Nike's failure to respond, White continued negotiations with Nike.
"Obviously, I was concerned that their interest in Arizona State University was waning and or would be reconsidered," says White.

But under state procurement law, White had no authority to continue negotiations with a potential vendor after an RFP failed to attract a suitable bidder, says ASU purchasing manager Ron Cantrell.

Instead, White should have asked the university's purchasing department to make revisions and reissue the RFP, Cantrell says.

"In this case, there was no [suitable] bid, so we rejected it," Cantrell says. "We got no further requests from the athletic department to bid it. So that's where we are at."

White, however, saw his opportunity to cut a deal with Nike slipping away, and he wasn't about to let that happen.

Within hours after the bids closed at 3 p.m. February 13, 1997, White was on the phone to Nike's Morris, and, according to White, engaged in a long and candid conversation about why Nike didn't respond to the RFP.

The next day, White wrote to his friend, Steve Miller, urging him to push Nike to reach an agreement with ASU.

"Steve, once again, per our many discussions, we felt that we were in great shape (in this regard)," White wrote in a February 14, 1997, letter which makes it clear that ASU had expected Nike to respond to its RFP.

A few days later, in what appears to be a halfhearted attempt by ASU to contact other possible vendors, White sent form letters to Reebok and Adidas, reminding the manufacturers that ASU was still seeking all-school shoe and apparel agreements.

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