Under Armour is currently one of the leading companies in the sports apparel industry whose mission is to “Make all athletes better through passion, science, and the relentless pursuit of innovation”.1 When Under Armour first broke into the sports apparel industry it was a disruptive pioneer that initially made the two giants, Nike and Adidas, a little weary. Under Armour revolutionized the sports apparel industry by creating apparel that used synthetic materials as an alternative to natural fibers, such as cotton, or other materials, such as polyester. This all-important switch to these materials resulted in a 2“shirt that provided compression and wicked perspiration off your skin rather than absorb it. A
Under Armour is a very popular and well-known brand throughout the world, there are many reasons why this is the case and why they are very successful as a company. Under Armour creates value for their customers in many ways, one of these ways is with their basketball shoes. Customers wouldn't want to buy shoes if they didn't think it would be durable and a good shoe. Customers can trust Under Armour’s basketball shoe because it is a shoe that somebody in the NBA wears. This shows that someone is willing to trust their million-dollar contract with their shoes to help them get their well-earned money, and that shows to confidence in Under Armour. Under Armour also gives many different options that the customer can choose from. They offer different technologies, materials, and articles of clothing. There are many different technologies they have, but I will only list a few. One of these technologies is cool switch, this helps athletes perform longer because the clothing will keep them cool and save them from sweating as much which helps save energy. Also, they offer many different materials in case a customer is allergic to a certain type of material there is always another so that they don't lose a customer. They also offer all different types of clothing so that whatever you need they'll have. Based on this research it proves that Under Armour has done so much to get where they are and be as successful as they are.
The competence of the Under Armour, Nike, and The Adidas Group are energetic and can be maintained continuously. All of three companies focus on the development, marketing and distribution of branded performance apparel, footwear, and accessories for men, women and youth. In one hand, they both have a large powerful brand image and benign reputation, in the other hand,
Under Armour’s business strategy towards market segmentation is broken down into three different basis; Age, Gender, Uses. The first major market segmentation is by age, different age groups demand different products and Under Armour has produced certain merchandise to appeal to each generation. The second is Gender, both male and female respectively make up roughly 50% of the market equally.To appeal to females UA produces apparel in brighter colo, as a fashion forward athletic wear. While for males they they cater toward masculine vibe of tight fitting and resistant to wear and tear. Lastly, UA segments by the range of uses for their products.
How strong are the competitive forces confronting Under Armour, Nike, and The Adidas Group? Do a five-forces analysis to support your answer.
Under Armour is a very famous sportswear company in the world. It sold products in three categories: apparel, footwear, and accessories. It had a wide variety of innerwear and outerwear in the apparel segment, a broad line of footwear, and a line of accessories for both men and women. Kevin A. Plank, the founder and Chief Executive Officer of Under Armour (UA), was a walk-on special team’s player for University of Maryland football team. As an athlete, he knew what kind of sportswear material would be popular for athletes. Under Armour created a new category of sports apparel: “performance apparel” which focused on the athlete’s performance. In this segment, it had a 78% market in 2009. Because, it paid more attentions on quality, performance
Under Armour is an existing firm that has taken large steps to become a major disrupter in the athletic apparel and footwear market. As this will primarily focus on the footwear segment of this company, it is vital to understand that the entire makeup and beginnings were due to the apparel aspect of their venture.
The rapid success of Under Armour is not a mistake. The company dominates the performance apparel category. According to Founder Kevin Plank, “The mission of Under Armour is to make technically advanced products that are engineered with superior fabric construction, to provide proven innovation available to the masses-aimed at making athletes perform better” (UnderArmour.com). Under Armour uses many marketing initiatives including athlete endorsement, product placement, and popular culture which illustrates the success of Under Armour.
Companies like Under Armour, Nike and Adidas/Reebok have high threats of substitute´s products. These companies share the sport apparel industry and are vulnerable to competitive pressure from the actions of buyers whenever they view that their products can be substituted for others. The availability of substitutes invites the costumer to compare performance, features, and ease of use as well as price. Under Armour’s major competitors are Nike and Adidas/Reebok because they have a similar or competing product offerings. The top sport apparel brands offer similar products and that is why each one of them needs to keep a high standard and produce good quality products in order for customers to keep buying their product.
An event such as the Olympic Games is an opportunity for manufacturers such as Under Armour to sponsor the national team from where the company is founded. In this case, Under Armour got the contract of developing the suits for the U.S. National Speed Skating Team. While companies such as Adidas could potentially provide the suits, Under Armour has the advantage of being an American company. While Nike is a direct competitor, speed skating is not something is commonly attracted to masses other than when the Olympic Games are underway and this was an opportunity Under Armour took.
While sitting for breakfast at Sadler Center, I collected my data from the thirty people around me. Most of the brands were of shoes and athletic wear, as these are the clothes that would be most distinguishable by style or that have the brand logo in clear vision. The most popular brands for shoes were Birkenstock, Nike, and Converse, which shows student preference for comfortable and practical shoes. In addition, most of the brands were more expensive, such as Vineyard Vines and Patagonia, showing that the majority of the William and Mary students or their parents can afford these brands, with some exceptions. I decided to focus on Under Armour because all of its merchandise worn in Sadler, such as t-shirts and sweatshirts, had the William
The threat of substitutes in this industry is high in my opinion. I say this because there are so many companies in the industry that have varying sports apparel, footwear and accessories. Customers can easily substitute one product by using another similar product of another company.
SUBSTITUTE PRODUCTS – MEDIUM: Low cost apparel appeal to casual athletes; anything that could be worn during a workout could deliver same value for consumers.
Companies in this industry also attempt to differentiate themselves by technical advancements in the apparel. Companies compete to find the technology that consumers believe will help their overall performance in sports and activities; whether it’s a sweat wicking shirt or lighter shoe, consumers seek the product they believe will give them the greatest advantage. Overall, the rivalry amongst competitors is a strong force that ultimately lowers the profitability of the industry.