Under Armour’s Strategy in 2014:

Potent Enough to Win Market

Share from Nike and Adidas?
Introduction
• Founded in 1996 by former University of Maryland football player
Kevin Plank.
• It started with a simple plan to make a t-shirt that provided
compression and wicked perspiration off the wearer's skin.
Thereby regulating body temperature and avoiding the discomfort
of sweat-absorbed apparel.
• 17 years later revenues of 2.3 billion US dollar.
Founder and CEO Kevin plank believed under Armour's potential for
long-term growth was exceptional for three reasons-

1. The company had built an incredibly powerful and authentic brand

in a relatively short time.
2. There were significant opportunities to expand the company's
narrow product lineup and brand name appeal into product
categories where it currently had little or no market presence.
3. The company was only in the early stages of establishing its brand
and penetrating markets outside North America.
Company Background
• Kevin plank growing up with four older brothers and playing football in
Maryland.
• He throughout himself in a football career, and faced discomfort in the hot
days and the unpleasantness of peeling of sweat-soaked cotton T-shirts
after practice.
• Plank hit upon the idea of using newly available moisture-wicking,
polyester blend fabrics , tighter fitting shirts and undergarments that would
make it cooler and more comfortable.
• In Maryland In 1996 he was selling the shirt to athletes and sports teams.
The Company’s Early Years
• Planks former teammates were playing the National Football League.
They knew him and call for the t-shirt. He worked the phone and visited
schools, training camps for showing his products.
• Planks made a good relationship with Kip Flucks who promoted his shirts
to lacrosse players.
• For better revenue Plank and Kip Flucks convinced the equipment
managers. Entire team adopted to use of the T-Shirts .
• In 1998 the company's sales revenue and growth prospects sufficient to
secure a 2500 thousand dollar.
• Planks high school friends became a partner of this Enterprise whose
name was Ryan wood.
Rapid Growth Ensues
• Over the next 13 years, the company's product line about to include a
widening variety of shirts, shorts, underwear, gloves and other
offerings.
• Specialized manufacturing techniques all in an attempt to make the
wearer feel -drier, lighter and more comfortable.
• In 1999 the company plans for geographic expansion.
• In 2004, SportsScanINFO estimated KP sports had a 73% share of the US
market for compression tops and bottoms. In addition sales were being
made to high profile athletes and teams.
KP Sports is Renamed Under Armour
• In late 2005, the company changed its name to under Armour and
become a public company with 9.5 million shares.
• Under Armour was outstanding shares of common stock consisted
of two classes:
• Class A common stock and class B common stock; both classes were
identical in all respects expect for voting and conversion rights.
• In 2008-2013 companies some chief operator wants to take retire
from the jobs. Over the past five years, the stock price had rising
more than 1300 percent.
 Under Armour’s Strategy

• Armour mission was "to make all athletes better through passion,
design and relentless pursuit of innovation."
• In 2014 the companies developed the marketing strategy and
distribution of branded performance apparel, footwear and
accessories for men, women and youth.
 Growth Strategy
In 2016 sales revenue was 4 billion US dollar. 71% above from 2013 sales
revenue.
Continent to broaden company's product offering to men, women and
youth forever in a waiting variety of sports and recreational activities.
Targeting additional consumer for expanding lineup of performance
product.
Increasing its sales and market share in the athletic footwear segment.
Expanding geographical and becoming the world market for sports
apparel, athletic footwear and performance products.
 Product Line Strategy
Expanding the company's product offerings and marketing them at multiple
price points had been a key element of under Armour's strategy.
• Apparel- the company designed and merchandised 3 lines of apparel gear
intended to regulate body temperature and enhance comfort mobility .
• Heatgear- it was designed to be worn in warm to hot temperatures under
equipment.
• Coldgear - was designed to wick moisture from the body while circulating
body heat from the hotspots to maintain core body temperature.
• All season gear - was designed to be worn in changing temperatures and
used technical fabrics to keep the wearer cool and dry in warmer
temperatures .
 Marketing, Promotion and Brand Management strategies

• Advertising campaigns to drive consumer demand for its products and

build awareness of under Armour as a leading performance athletic
brand.
• Promote the sales and use of its products to high performing athletes and
teams
• Using sponsorships to broaden consumer awareness of its brand. It was
an official supplier of performance apparel to any countries and locations.
• Securing the endorsement of individual athletes.
 Retail Marketing and Product Presentation

• Marketing strategy was to increase the floor space exclusively

dedicated to under Armour products in the stores of its major
retail accounts.
• The key initiative was 'shop in shop'. This shop-in-shop approach
was seen as an effective way to gain the placement of Armour
products in prime floor space, including flooring etc.
• The company worked with retailers to establish optimal placement
of its products.
 COMPETITIVE
STRATEGY
PRODUCT AVAILABILITY AND DISTRIBUTION STRATEGY OF UNDER ARMORS
WHOLESALE DISTRIBUTION
• During 2011- 2013 close to 70% net revenue generated from sales to
revenue.
• Two biggest retail accounts were Dick’s sporting Goods and The Sports
Authprity.
• Others were Academy sport And Outdoor and Hibbett Sporting Goods ,
Modell‘s sporying goods,Bass Pro Shops , Cabela’s foot locker, Finish
Line,Army And Air Force Exchange Service, Macy’s, Dillards , Balk ,Lord
And Taylor’s.
 DIRECT TO CONSUMER SALES

• Direct-to- consumer sales generated 30.4% revenues in 2013

• Included salesvof discount merchandise at company owned retailed stores
global website (www.underarmour.com)
DISTRIBUTION STRATEGY

Nike Distribution
Focuses on direct selling to consumers
Adidas
Used direct and indirect way for distribution
 PRODUCT LICENSING

• Preapprivef all products manufsctured and sold by its licensees

• Relationship with licensees for uniform, eyewear and custom model mouth
guard and distribution Of Under Armour Products
 DISTRIBUTION OUTSIDE NORTH AMERICA

• Established relationship with Japanese license center and make their first
trategic move

• Organized international relationship into four geographic region(North

America, Latin America,Eyrope and Middle East
• Began selling its products inparts of Latin America and Europe and expanded
sales effort through Chile, Mexico , Australia , New Zealand and Taiwan
 PRODUCT DESIGN AND DEVELOPMENT

• Chargd cotton products

• Storm armour Fleece Product
• Coldblack
• Colgear Infared
 SOURCING,MANUFACTURING AND QUALITY
ASSURANCE

• Many of the fabrics and raw materials used in the UA products were sourced
from the Limited number of preapproved specialty fabric manufacturers
• UA production came from suppliers which has 6 primary location In
China,Malaysia,Mexico,Taiwan,Vietnam
• In 2013,substantially all UA products were made by 26 countries
• Contract managers were required to adhere to a code of counduct quality of
manufacturing,working condition and other social conditions
SALES
Under armor :
Sales outside north america was only 5.9%of the company’s revenue(poor
show)
Nike :
Profit margin to be seen 27.2%(good show)
Adidas :
Profit margin to be seen 5.8%(poor show)
 MANUFACTURING

Under Armor :
• Outsourcing fabric production
Nike :
• Was manufactured outside of United States
Adidas :
• Was outsourced to 322 independent contract manufacturers
 COMPLICATION

In 2012 the global market for authentic footwear was about $75billion and was
forecast to reach about$ 85 billion in 2018
*The major competetitors and brands were Adidas and Nike ,under Armor ,East
bay, addidas Russel
*Nike was the clear global market leader
Nike Inc.

• Founded on January 34, 1968 as blue ribbon sports

• Nike is athletic company manufacturing , designing and maketing apparel
• Nike is well for having factories in developing nation
• Total company wide saleswere $23 billion in 2013 and$ 25.3 billion in
fiscal 2013 which is twice that interest
 Marketing 1. Create a better mix.
2. Product development.
3. Influencing sports and fitness.

Promotion
1. Sponsorship
2. Endorsements

Endorsements
Soccer, baseball, basket ball, golf,
tennis etc
 Research & development

• R&D is the key factor of Nikes success.

• Professionals to review the product.

Manufacturing

98% production in Vietnam, china and Indonesia.

Independent manufacturers in a country basis.

 The Adidas group
 Brands- Adidas, Reebock, Taylor made Adidas golf,

 1661 franchise store, 779 company owned outlet, 300 other outlets.

 Sponsor in FIFA 2011& 2014, UEFA, NFL, NBA ETC.

 Endorsement of various basketball, football and tennis players.

 1.46 billion for event promotion in 2013.

 95% production was done in 322 independent manufacturers of Asia.

 Expected global sales in 2015 was $17 billion globally.

THANK YOU