"There's been a surge in merchandise that historically was little more than T-shirts and mugs," said Brett Eden, the U.'s director of licensing and marketing. "But during the past four years, we've seen record growth with manufacturers creating products. Now, we have everything from licensed coffins (with a U. logo) to barbecue sauce."
Manufacturers typically pay a 12 percent royalty fee to the U. and 9 percent to BYU, based on what each school has decided to charge. Although BYU's fee is lower, four years ago the university raised the price from 7.5 percent. Fees are based on the item's wholesale value, which brings in from $500,000 to $750,000 annually to the U. (BYU, a private school, keeps that information private.) Royalties paid to the U. go into athletic scholarships and at BYU to scholarships and other school programs.
It is retailers, however, that reap the bulk of the profits from university-themed products, with the U. estimating a take of $20 million to $30 million a year from Ute-branded items.
"That's OK [because] we see ourselves as being a partner in communities," said Eden. "We want to help local businesses succeed, and this is a relatively easy way to do it."
More retailers are getting in on the action. College bookstores, the traditional outlet for merchandise, have been joined by big-box outlets such as Walmart, midlevel players such as Smith's's Food & Drug stores and smaller operators such as the new U Rivals store at The Gateway in Salt Lake City.
U Rivals opened this week, selling Ute and Cougar merchandise in time for the BYU-Utah football game Saturday evening.
"This is, after all, one of the top 10 rivalries in the country," said Joe Bunt, one of four partners in U Rivals. "There's a lot of loyalty to each school."
The U. tops BYU in royalties received, capturing the No. 39 spot to the Cougar's No. 50 ranking by the The Collegiate Licensing Co., the nation's the oldest and largest school licensing agency, representing nearly 200 colleges, universities, bowl games and conferences.
The University of Texas at Austin is in the No. 1 spot in royalty payments. Nike USA Inc., once known exclusively for athletic shoes, is the top-selling company for collegiate clothing, while the California video game company EA Sports (which has operations in the Salt Lake Valley) sells the most non-apparel merchandise.
Adam Parker, licensing and trademark manager at BYU, said that sales naturally pick up before each home game. There's also heightened interest when the Cougars beat the Utes. That hasn't happened since 2009, when BYU defeated the U. 26-23, in overtime.
BYU, owned and operated by The Church of Jesus Christ of Latter-day Saints, also may have a wider base of fans, Parker said, with members worldwide rooting for the team. He is unsure how that factors into merchandise sales.
The Cougar-Ute rivalry plays out in interesting ways between the two schools' licensing directors. Eden likes to say he enjoys wearing a Ute T-shirt in BYU's home territory of Utah County "just to see the reaction." BYU's Parker is quick to point out that Eden is a Cougar alum. The two have helped each other move (both live in northern Utah County) and they regularly attend trade shows together.
Next week, Eden will join Parker in Boise for a game at Boise State University where Parker is a Broncos alum. BSU's opponent is BYU.
University royalty rankings
Based on royalties received for collegiate merchandise. Here's a selected breakdown:
No. 1 • University of Texas at Austin
2 • University of Alabama
3 • University of Florida
4 • University of Michigan
5 • Louisiana State University
6 • University of Kentucky
7 • University of Georgia
8 • University of North Carolina
9 • University of Oklahoma
10 • University of Notre Dame
30 • Arizona State University
31 • Boise State University
32 • University of Arizona
36 • Oregon State University
39 • University of Utah
41 • Washington State University
50 • Brigham Young University
Source: The Collegiate Licensing Co.
Free events Friday, the day before Utah-BYU game
Cougars • At 7 p.m., BYU head coach Bronco Mendenhall, wife Holly and members of the BYU football team will participate in an hourlong devotional at Temple Square's Assembly Hall in Salt Lake City.
Utes • At 6 p.m. a parade will begin at The Gateway mall, starting at Rio Grande St. and finishing at Olympic Fountain Plaza for a pep rally featuring the Marching Band, Cheer Squad, Dance Team and Swoop.