UMBC Positioned to Take Advantage of March Madness Success

BY ADAM GROSSMAN

The biggest star of the 2018 NCAA Division I Men's Basketball Tournament so far is Zach Seidel. The University of Maryland Baltimore County (UMBC) director of multimedia communications for the athletic department is the man behind the Twitter account that has done everything from trolling CBS / The Athletic reporter Seth Davis and ESPN to espousing the virtues of UMBC to people who had not heard of the university prior to the school becoming the first 16 seed to upset a 1 seed in the history of the NCAA Tournament. Seidel’s ability to create a unique voice through real-time comedic Tweets generated interview requests from national media outlets – including The Athletic and ESPN.

Seidel, however, is “only” a star on the UMBC team. UMBC as an institution is the biggest winner of the NCAA Tournament so far, even more for what it has done off the court than on the court. More specifically, UMBC had positioned itself to take advantage of success if / when an upset in the NCAA Tournament happened.

The first step in understanding why this is so is understanding the full potential value of college athletics. For many schools, college athletics is a marketing asset that functions like a brand influencer. In particular, the reason that Seidel became a star is that conversations around varsity athletics can generate significant attention for schools in ways that professors, academic programs, or new research does not. That is why so many analyses of the value of UMBC’s upset are focused on the “media value” the school generated for the win.

Media value, however, is not likely UMBC’s ultimate goal. The school is attempting to use athletics in similar ways that corporate partners should be using sponsorship assets – to achieve discrete business goals. UMBC’s “business” is focused on recruiting as many bright students as possible to apply to the school for admission. For virtually every college or university, tuition is by far the biggest revenue driver for the school. Investments in athletics should have an impact in both the number of applicants that apply and the annual tuition a school can charge because it is more attractive.

Making investments in basketball, as UMBC has done, or in football can have a tangible impact on a school’s admissions. In particular, a school that has an upset does see a significant increase in admissions. According to a recent analysis of Department of Education Data from Bloomberg:

Schools that beat performance expectations during March Madness receive a bump not only in public awareness, but also in the number of applications they receive. For example, as Bloomberg points out, after then-15th-seeded Florida Gulf Coast’s wild run through Georgetown and San Diego State to advance to the Sweet Sixteen of the 2013 tournament, applications to the Fort Myers, Florida, campus spiked 27.5 percent. A similar trend was observed at Lehigh University after it bounced perennial tournament contender and then-second-seeded Duke from the first round of the 2012 tournament. And it’s not just one shocking upset that results in more applications: If a team makes it further into March than expected—such as Wichita State’s surprising Final Four berth in 2013—it can also experience increased interest. Wichita State, for its part, received almost 30 percent more applications following its success on the court in 2013, Bloomberg reports.

This is not just the case in basketball. In his study of the “Flutie Effect”, Harvard Business School professor Doug J. Chung found that:

When a school goes from being mediocre to being great on the football field, applications increase by 18.7%.
To attain similar effects, a school has to either decrease its tuition by 3.8% or increase the quality of its education by recruiting higher-quality faculty who are paid 5% more in the academic labor market.
Schools become more selective with athletic success. For a mid-level school, in terms of average SAT scores, the admissions rate improves by 5.1% with high-level athletic success.
Surprisingly, students with high SAT scores are also significantly affected by athletic success.

UMBC appears to have applied these types of lessons to its commitments to athletics. As Seidel humorously stated in a Tweet, ” BTW guys, we have a brand new $85 million Event Center we opened up last month that still doesn't have a corporate sponsor name.... (sic) .” UMBC is in a better position now to obtain a sponsor after its historic upset. However, the decision to make this type of investment into an Event Center shows the importance the school placed on sports and events long before its upset occurred. It also positions the school for longer-term success in admissions by making this type of investment in athletics.

UMBC should also take this point-of-view when looking for corporate partners for its new venue. Rather than just examining the media value of its basketball team, the school should look at the core business of potential corporate partners. For example, Seidel’s efforts increased the school’s Twitter followers from 5,500 to 109,000 followers over the course of the Retrievers run through the NCAA Tournament. The University of Maryland has 149,000 followers. If partners are only looking at audience size then the Terps are still a significantly better spend than the Retrievers.

UMBC should focus on why the quality of its audience can help potential corporate partners achieve their revenue and marketing goals. For example, UMBC can now make a compelling argument to Adidas about why the apparel brand should be the naming rights partner for the Event Center. Seidel’s social media activity has helped to define a UMBC brand in-line with Adidas’ “three clear strategic choices that we want to focus on: Speed, Cities and Open Source.” In addition, Under Armour (one of Adidas’ biggest competitors) has made significant investments in the University of Maryland’s athletic department. Adidas’ sponsorship of the UMBC Event Center would enable the company to directly compete with Under Armour in the county and state where Under Armour is headquartered.

Schools do not need to make $85 million investments to achieve success. In The Sports Strategist: Developing Leaders for a High-Performance Industry, my co-authors and I highlight the University of Chicago. The Maroons was an original member of the Big Ten athletic conference and home of the first Heisman Trophy winner. However, the school decided to end college athletics in 1939 so that it could make sure its students and the institution could focus on academics.

The decision contributed significantly to the school earning the reputation of the place “where fun goes to die.” While the school re-instituted its college football program in 1969, it only more recently made the team a priority to show that the college experience was more than solely the academic experience. The school saw a rise in applications after making a more public face of the out-of-class offerings Chicago provides its students.

UMBC was the winner of the opening weekend of the NCAA Tournament. However, the school’s investments in athletics should pay long-term dividends in helping the school take advantage of this success.