The Annihilation of the Penn State Brand

By Sam Lantor

Note: The recent events at Penn State University have shattered the image of the school’s legendary football program and its storied coach Joe Paterno. The impact on the university’s reputation will be felt for years to come and will impact more than athletics. Following is a blog post from one of CRT/tanaka’s summer interns, who gives a college student’s perspective on the situation.

The NCAA’s stiff sanctions imposed on Penn State’s football program on Monday are a clear indication of the governing body’s disapproval of the cover up of child sex abuse allegations at all levels of the university for many years. If you’ve somehow missed the almost yearlong uncovering of allegations, charges and conviction of former defensive coordinator Jerry Sandusky, here’s a timeline of the events as they unraveled at Penn State.

On June 22, a jury convicted Sandusky of 45 counts of sexual assault involving 10 boys over 15 years. An FBI investigation released a few weeks later revealed that top Penn State officials, including legendary football coach Joe Paterno, as well as other coaches, janitors, psychologists and campus police were aware of the allegations against Sandusky. This report was the most damaging piece of evidence to the university’s reputation, credibility and integrity, as it demonstrates the administration was aware of the incidents, but failed to take action.

Monday, the NCAA slapped the Penn State football program with sanctions including:

• A ban from bowl games for four years
• The loss of 10 football scholarships per year for four years
• $60 million in fines to benefit a fund for victims of child abuse
• Five years of probation

The scandal and the subsequent sanctions are impacting Penn State well beyond the loss of 40 scholarships over the next four years and the four-year bowl ban. It is destroying (or has destroyed) the football program’s brand and the millions of dollars associated with it. High school coaches and parents, who influence the decisions of high school standouts, will most likely discourage the best young athletes from attending a school plagued by such a horrific scandal. The loss of these high school recruits will have a major impact on the success of the program – measured in wins and losses – for years to come.

But more than the football program will suffer at Penn State. Enrollment at the university as a whole could very well suffer, as fewer freshmen may choose Penn State. In this job-tight economy, high school students may overlook Penn State, not only because of their personal opinions about the school’s recent scandal, but because of fears of how future employers and future graduate schools might perceive a Penn State degree.

Unquestionably, Penn State has gone from having a reputation that focused on high academics, a  student-oriented atmosphere and the famous “WE ARE” mantra, to being known for something they may not be so proud of – lying.

Reputation damages of this magnitude have significant financial implications. The football program is ranked fifth highest of all college programs in the country, with revenues of $72 million. Add to that the $24.1 million in revenue that stem from sponsorships and merchandise sales linked to the football program. Well, you can pretty much kiss that goodbye. When you factor in the $60 million of fines, legal fees estimated in the millions and the potential dollars lost associated with future civil lawsuits, Penn State’s fiscal future starts looking dismal.

So what is next for Penn State? That is a question that goes beyond my knowledge of crisis communications and brand management. Penn State has a rough road ahead, full of nasty potholes in order to rebuild its brand and bottom line.

Even with strong alumni support, I think the Nittany Lions’ culture is forever damaged and may never fully recover from this horrible event.

Photo credit: http://www.nowpublic.com/culture/joe-paterno-statute

About Jeff Wilson:

Jeff Wilson, APR is associate vice president and director of business development for CRT/tanaka. He develops and guides the implementation of the agency’s strategic communications plan, which includes media relations, social media, sponsorship, website copywriting, advertising and collateral material development. He also provides day-to-day management of the agency’s new business response functions. Jeff has earned some of the PR industry’s most prestigious awards, including PRSA Silver and Bronze Anvils, a PRSA Health Academy Innovation Award and an IABC Gold Quill. He was named one of PRWeek’s “2008 Top 40 Under 40” as well as one of Richmond’s “2007 Top 40 Under 40” by Style Weekly. He also is immediate past president of PRSA Richmond.