Under Armour products are “a superior alternative to traditional athletic products.” (“Under Armour Annual Report 2015,” 2015). The apparel is specially engineered to “enhance comfort and mobility, regulate body temperature and improve performance regardless of weather conditions.” (“Under Armour Annual Report 2015,” 2015). Fabrics used in Under Armour apparel, footwear, and accessories is “primarily synthetic fabrics and involve raw materials including petroleum based products that may be subject to price fluctuations and shortages (“Under Armour Annual Report 2015,” 2015). For some of Under Armour manufacturers there are wage rate regulations set in place by their country’s government. These regulations can cause production prices to fluctuate. Under Armour manufactures many of their products overseas which affects distribution and transportation costs when the price of oil fluctuates.
Over the past five years, although Under Armour’s Cost of Goods Sold (COGS) has increased in dollars spent, it maintains an average fifty-two percent of Net Revenues during the timeframe of 2011 – 2015 (“Under Armour Annual Report 2015,” 2015). Under Armour’s average COGS during this time is $1,308.157.00 (“Under Armour Annual Report 2015,” 2015). One of the materials Under Armour uses is cotton. The 2015 price of cotton has decreased to fifty percent of the 2011 calendar year average of $155.70 (“Monthly Prices – National Cotton Council,” n.d.). Crude oil, another material used in Under
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
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.
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
The five key growth drivers for Under Armour are: “Men’s and Women’s Apparel, Footwear, International and Direct-to-Consumer” (Under Armour 10K, 2009, pg.1). In 2009 Apparel revenues
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
Buyers want to reduce their costs and purchase a product at a lower or more convenient price for the best quality and service. Buyers have the choice to switch to another product at no cost. Under Armour has developed unique products that its consumers value and are willing to pay more for.
It is anticipated that in the coming months, the organization will earn a 4% increase in the share prices. Moreover, in the coming quarters, it is expected that the company will have an increase in the value of the stocks with a staggering $4.02 billion in revenues. As at the end of the year, it is expected that the organization will earn $1.22 per share, up 16%, while revenue of $4.98 billion would mark a decline of 25.7% from the year-ago quarter. Such a significant growth is attributed to the increased sales for its footwear. Most of the sporting teams such as the National Basketball Association (NBA) has had Under Armour as their preferred supplier for its sporting utilities. As
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’s continuous focus on innovation to develop products based on the growing needs and preferences of consumers has helped it to become a fully integrated athletic brand servicing all the needs of athletes. For instance, in 2011, the company introduced Charged Cotton products, which are made from natural cotton but perform like synthetic products and dry faster. Strom Fleece product line with a water-resistant that repels water, without stifling airflow was one of the innovation of Under Armour. In 2012, the company launched coldblack
Under Armour is in the Textile- Apparel Clothing industry, in the consumer goods sector. The market has been driven by economic recovery, new product offerings and a
Under Armour has a 4.71% market share in the global sportswear segment , and it is facing great pressure from big players such as Nike and Adidas, as well as fast growing companies like Lululemon and Fila. The intense environment makes it difficult for incumbents to offer very distinct products and thus often results in price
Unfortunately, the results I found from my research about the relationship between Under Armors Go Green line and their costumer market increasing showed no correlation. In the documentary it made Under Armours green line sound like the next new and upcoming trend in apparel. Granted the movie was filmed a few years ago, it was hard to find any evidence of their Go Green line by even googling Under Armour Go Green line. Most of the time the only results that
The corporate tax rate has just decreased from 35% to 21% which is good news for UA but not as much as companies that do more business in the US and also for a company that has significantly less debt than the highly leveraged Under Armour has (The Economist, 2018). Social factors are quite important for the retail industry and in 2017 a large demographic for clothing sales, teens, spent less overall and claimed Under Armour a brand they did not wear and athleisure in general to not be preferred attire anymore (Reagan, 2017). Thus, Under Armour’s demographics changed just in the last year with teenagers claiming to not be wearers of the brand, and also the trend of athleisure coming to an end. Technology is an external environmental factor that affects Under Armour, but not as much its competitors in the industry. When fitness bands were introduced the company also came out with their own line of bands that proved unsuccessful and were discontinued (Booton, 2017). Under Armour maintained their fitness apps however and they are able to have an edge over their competitors by having all of this information
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