In 2014, Under Armour overcame Adidas in U.S sportswear market and thus became one of the fastest growing brands, after only 18 years in the business. $4 billion of revenue was recorded for the year 2016. Revenue experienced 23 quarters of grows and sales are up by 31%. Internationally, sales are up by 65%. Projections indicate a $10 billion revenue by the year 2020. But how Under Armour experienced a quick success in this competitive market?

1.Origins

Under Armour was born in 1996 after former University of Maryland football captain Kevin Plank, then 23, was fed up with his cotton t-shirts getting wet, heavy and uncomfortable during practice and match. From his grandmother’s basement in Washington D.C, after research on the benefits of synthetic fabrics, he decided to borrow material from women’s lingerie to create sportswear that stays dry and keep you fresh during an effort. The name comes from his brother, derivated from body armor.

Plank went on to travel the east coast of the US by car to sell his new products. By the end of 1996, UA makes his first team sale and generated $17000 in revenue. The HQ of the company then moves from Grandma’s basement to a new Headquarter and warehouse in Baltimore.

What are the keys of Under Armour success?

 

2.Innovation

As seen, innovation is at the core of the brand. It was the motivation behind his foundation. By 1996, UA was able to deliver products that perpetually kept the athletes cool, dry and light in heat condition (Under Armour HeatGear® T-shirt). In 1997, UA introduces ColdGear® fabric, which keeps the athletes warm in cold condition. Under Armour is selling usefulness, functional products for greater performance. The advantage of selling new practical products compare to just fashionable products, you can patent your innovation. You then become the sole beneficent of a new market, until your competitors catch up. In 2016, UA had 75% of the market share of the new materials athletic wear.

In 2015, seating on his previous successes, UA went on to buy 2 fitness apps companies and launched UA record; now, the world’s largest fitness platform. Today, 165 Million fitness enthusiasts use the app. That is 1/4 Americans!

UA has been established as a company that doesn’t just change how athletes dress—we change how they live. (Source: www.uabiz.com).

In 2016, to celebrate Under Armour 20th anniversary, the brand releases one of the world’s first smart shoe, “The Speedform Gemini 2 Record“, which connects to a fitness app to track your progress.

Does UA products and innovation is sufficient to explain his success? No. Marketing played a huge part to cement Under Armour as one of the best sportswear manufacturers.

 

3.Marketing

From the beginning, Under Armour established itself as an underdog. A brand that endorses the idea that “constantly trying to overcome obstacles through hard work, is the key to win”. The campaigns “I will what I want” or “Unlike Any” demonstrates just that. People relate to that image. It shows attitude, character. It goes subtly against the motto “Just do it” of their main competitor. UA projects that winning is not just a matter of doing it, leave excuses aside; but it is reached through commitment and hard work. And “we” can help you perform at your best with this innovative products.

UA endorsement and partnership deals is also a big part of their success.

Partnerships/Sponsorships.

The first contract was in 1999 with a release of the film “Any Given Sunday” by Oliver Stone starring Al Pacino and Jamie Fox. UA supplies the apparel and accessories for the movie. This exposition and an investment in an ad in ESPN magazine generated $750,000 in sells.

Since 1999 the brand formed a relationship with key professional athletes and partners.

In 1999, deals in Major League Baseball, National Hockey League and the Baltimore Marathon were signed. In 2005, UA signed his first all school deal with the University of Maryland.

2008, is the beginning of partnerships with key additions to World class athletes including Future Hall of Famer Ray Lewis, gold medal skier Lindsay Vonn, MMA world champion Georges Saint-Pierre and basketball player Brandon Jennings. At the end of 2010, UA signed the most accomplished Olympians athlete, Michael Phelps; two times Super Bowl MVP Tom Brady and a young tennis prodigy named Sloane Stevens.

Also in 2010, UA supported the Auburn Tigers in their win of the 2010 BCS Championship, led by future Under Armour athlete and NFL rookie of the year, Cam Newton.

This led to an incredible financial milestone. Under Armour surpasses $1 billion in Annual revenue in 2010. A revenue that had quadrupled in 5 years.

In 2013, Under Armour signed what will be their most lucrative athletes, the basketball player, Stephen Curry. Curry brought $14 billion to UA! His signature shoes are the second most selling signature shoes in the market, second only to the Jordan brand.

In fall 2015, UA signed a multi year collaboration with late, but great Muhammed Ali. (video). The company tweeted: “The most iconic figure in sports is teaming up with the most innovative Brand in the game”. A collection of apparel and shoes is available here. Partnering with probably the most recognized athlete of all time, was a move that you wonder why Nike or Adidas didn’t think of before.

UA doesn’t sign any athletes, they sign rising athletes. Andy Murray became number one under UA signature, Anthony Joshua became the Heavyweight champion with UA, Steph Curry became a two time MVP and NBA champion with Under Armour, Michael Phelps won 5 gold medals in Rio in 2016, Tom Brady won another Super Bowl in 2017 wearing UA, Jordan Speight made history as the US Open champion and PGA player of the year in 2015, Misty Copeland became the first African-American Ballerina promoted to principal dancer at the American Ballet Theatre.

It’s a more patient approach which has been really successful and goes with their image and ideology of underdog defying the odds.

Through exposure, UA attracted new buyers and a new fan base. In 2011, Under Armour became the official technical partner of the Tottenham Hotspur in the British premier league. Tottenham was seating 6th in the table in 2011, 2nd in 2017. Stores opened in China and Europe. In the Olympic in Rio 2016, Under Armour endorsed USA Gymnastics, USA Boxing, Canada Rugby, Switzerland Beach Volleyball, Netherlands Beach Volleyball, New Zealand Kayak and Canoe, and Hungary Kayak and Canoe.

To reach kids, UA has invested massively into sponsoring youth training camps and the Junior PGA Tour. Nobody is left over.

Here is the list of all Under Armour sponsorships.

Another triumph for the brand, the signing of a 10-year uniform deal with Major League Baseball to start in 2020.

Advertising campaign

The first ever Under Armour TV campaign dates from 2003. “Protect this House“. Here is what UA has to say about the ad: “This House became a rallying cry for athletes everywhere, it established the Brand as the authentic voice for the next generation, and it officially made Under Armour a household name.”

In 2014, UA invested in their most expensive women campaign “I will what I want”. Featuring ballerina Misty Copeland and supermodel Gisele Bundchen.

Here is what UA has to say about the campaign: ““I Will What I Want” was a celebration of the strong, unstoppable women who defied expectations to achieve their dreams.”

From this point on, a new audience has been reached. The campaign has been really successful to attract women to buy UA. Today, the women’s sales represent 1/3 of UA revenue. Considering that the brand started on a football field and was predominantly man oriented, it is huge.

In 2015, UA launches their campaign called “Rule yourself” which received enormous positive feedbacks.

Video #1

Video #2 This spot featuring Michael Phelps ahead of The 2016 Olympic games, was voted #1 ad in Adweek, and received over 12 Million views on Youtube.

Under Armour understood the power of image, and takes full advantage of it.

Social Responsibility

Under Armour associates his name with programs to help fight breast cancer for example with the “UA power in Pink” program; to help wounded veterans with “UA freedom” program, to be more ecologic conscious with “UA green” and a program to help the youths fitness level with “UA youth movement”.

 

Under Armour success started with innovative material/products that enhance performance. Helped by their thoughtful ideology, sponsorships and marketing image, we can only see Under Armour becoming even more successful in the future.

While Nike has been dominant in this sector for years and is today, well ahead in terms of revenue; where will stand Under Armour in 10, 20, 50 years from now?

 

Antoine