Case Analysis : Under Armour : Risk Of Entry

It should be noted that Under Armour and its competitors form a segment of the Apparel Clothing market geared toward recreational and formal athletics. Under Armour, and its main competitors of Columbia Sportswear and Nike, are recognizible and prestigious brand names in the United States and in many other countries, yet affordable, to an extent, to most middle class Americans. They are popular among teenagers and young adults, and also worn by practical middle aged people and senior citizens. The desirability, versatility, and practicality of these items are intrinsic to the companies and help lead to their success. Specific practical yet luxurious products are offered, such as shirts and pants for running, that help the runner in either too hot or too cold climates. With more and more people trying to exercise for health, beauty, athletic, and other reasons, these types of products are in demand. It seems that there are some Niche markets, and unique products, among each of Under Amour and its competitors, so there is not much threat between the different brands. Also, some recreational and formal athletes would purchase all three brands of items. The industry is considered to be a growth industry, but also somewhat mature as all the brand names are recognized. The following article explains how the author, at the end of 2014, considered Under Armour to be “a great growth stock” http://investorplace.com/2014/12/under-armour-inc-ua-stock-growth/ (Navellier

Competitors in the industry can wreak havoc on the bottom line for a company. With rivals, a price competition usually ensues, which benefits the customers but hurts the competing businesses that share a common strategy. In reviewing rival sellers, many competitors exist within the sports apparel and footwear industry, but most of them are unable to compete with the industry giants, Nike and Adidas. They are well seated in the industry and their sales reveal this ultimate strength, however, Under Armour is putting pressure on these mammoths. In 2015, global sales of sports clothing and footwear equated to $250 billion, of which Nike grabbed $30.6 billion, Adidas held in its grasp $18.8 billion and Under Armour had a much smaller piece of the pie, at $3.9 billion globally. In reviewing these numbers, it looks like Under Armour is really subpar to the industry giants, but this is not exactly the case. Under Armour in the past couple of

a. Under Armour’s approach towards innovation is very unique, they think and plan out their projects thoroughly in order to create a one of a kind product that could be appealing to their consumers. The company has been extremely progressive throughout the years in order to stay ahead of the other competitive companies in their targeted industry. By constantly updating and coming up with different product lines, such as compression shirts and cleats, Under Armour is able to compete with other top athletic wear company’s in their market. If

The also place a big emphasizes on the Under Armour logo and pushed for brand recognition. Under Armour became the official uniform sponsor for many colleges and sport teams. Under Armour’s strategy was to design and make varies styles of sports apparel with their moisture-wicking fabrics to satisfy the needs of athletes of all levels and all sports. Their growth strategy was to continue to expand on the products they offered their consumers. They wanted to create more products that encompassed several sports and activities. By doing this they would be targeting additional consumers with their new performance products. Part of the growth strategy was to expand sales in foreign countries, become a global competitor in sports apparel and strengthening the appeal of their products and brand

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

There is a high threat of substitutes in the athletic gear industry especially when competing with companies such as Nike and Adidas who have been around much longer, have the funds to continuously innovate their products and already hold a large market share. Under Armour has used “authenticity” as it’s guiding principle to grow the company and advertise their products, but if they wish to be the number one brand of athletic gear they will have to appeal to people who are also concerned with the look of the product and not just performance. According to research done by NPD Group, almost 80 percent of activewear is used for non-sports activities. “Under Armour will need to find a

In today’s athletic market world, being the number one is what many athletes strive for—that is what sets the standards for many sport clothing companies, to deliver products that allow athletes increase their performance while striving to take the number “one” spot. Under Armour works to deliver products that do that and more. Under Armour is currently one of the leading companies in the sports apparel industry whose mission is to “Make all athletes better through passion, design, and the relentless pursuit of innovation” (Under Armour, Inc). Baltimore, Maryland-based Under Armour, founded in 1996 by ex-football player Kevin Plank, who transformed 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. Plank’s mission was to develop a shirt using synthetic materials that handled perspiration most efficiently than was previously expected. Under Armour’s ability to target their products to a wide range of potential clients has enhanced their ability to continue to grow within the athletic marketplace. Under Armour, it is classified as a high-end fitness clothing supplier that appeals to a diverse income audience. This audience has been reached by the outstanding advertising strategies and that include men, women and children. Under Armour currently uses a mixture of pull marketing and different campaigns for its diverse product lines. The overall goal for Under

The major weakness that has been identified is the lack of Under Armour’s lack of establishment and footprint of the brand around the world. Over 90% of the company's revenue comes from the North American market, which is a major source of concern. They are starting to become a larger brand in the golfing world which will help them gain market share in the western world but still doesn’t help with eastern Europe, Asia, and Africa. They can change this by sponsoring and equipping more soccer and cricket athletes and teams. These are some of the two largest sports in the world and if they are able to get their brand associated with these sports Under Armor will easily become a household

Under Armour should exercise a focused, differentiated approach by exclusively developing performance apparel. Its non-standardized products are good for customers who prefer performance than price. For this reason, the corporation should have more emphasis on research and development to offer products, which are superior to what is in the market. On the other hand, its focus strategy should aim at particular sports, serving each sport’s needs more precisely than the broad apparel companies like Adidas and Nike. Combining a focus differentiation strategy will enable the firm to create a fertile niche positioning meanwhile meeting the customer’s specific needs (Kenyon,

From the beginning, Under Armour has been a very innovative company. CEO, Kevin Plank innovated the way athletic apparel was made. They also still display passion through one of their core competencies, listed in Exhibit 3, which is to bring as much value as possible to their customers. Another one of Under Armour’s weaknesses according to Exhibit 2 is the lack of their international business. When you compare Under Armour to Nike it is easy to see how big of a difference there is between their geographical exposures. While the majority of Nike’s revenue comes from North America, they also have business segments all over Europe, China, Japan and some emerging markets as well. Adidas is modeled the same way. As mentioned briefly earlier, they have large segments of their revenue coming from regions around the world such as Europe, China, Asia and Latin America. When you compare this to the fact that roughly 94% of Under Armour’s net revenues over the past several years has come from North America, it is easy to see why they need to focus on expanding their international business segments in order to keep competing in this industry (Under Armour 10K). Under Armour’s competitors are working to further

Under Armour is a company started by Kevin Plank in 1996 in a basement. The company went public in 2006 raising a total of $153 million as equity. From a small private company to a multi-billion generating organisation, Under Armour had to overcome numerous challenges including financial difficulties and sales growth. The founder started with premium quality sports clothes and today the company specialises in diverse sportswear and apparel. Through the development of new hi-tech gears, Under Armour, Inc. has been able to penetrate and establish itself in the sports apparel market. It is constantly coming up with new products and adopting innovative strategies to meet the growing needs of its customers as well as to stay ahead of its rivals. A brand which was hardly known a decade ago is today worn by elite athletes in virtually every sports – for instance, Michael Phelps, the Rio Olympic gold medallist, promotes the brand.

The athletic industry is a demanding market where brands battle for consumer’s attention and try to hold on to them through brand loyalty. To compete with one another, companies have to come out with new trends regularly. Nike is a leading competitor in the market and has been for the last fifty years. However, Under Armour, an up and coming competitor is challenging Nike through new styles and lower prices. These two companies look fairly similar; however, Under Armour’s strategy is different and it should be putting Nike on edge.

Other clothing brands have the ability to start manufacturing athletic apparel to take away market share and diversify their portfolio. Thus, existing apparel companies could enter the performance apparel market if they decide to invest capital for advertising and building product demand. Under Armour has weak patent protection over its product; hence, there is a threat of different unexpected entrants who want to reiterate on their proven formula. Overall, the threat is less imperative to their continued success since other issues are more pertinent and likely.

SWOT Analysis: Under Armour History: • Founded in 1996 by former University of Maryland football player Kevin Plank. • Originally started with a simple plan to make a t-shirt that provided compression and wicked perspiration off your skin instead of absorbing it. • “Under Armour’s mission is to make all athletes better through passion, design and the relentless pursuit of innovation.” • In 1999, Plank and his team signed on to supply product for the film Any Given Sunday. In the film, the football team wears Under Armour apparel and accessories in key scenes.

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