Under Armour – the underdog beating the big boys
Post by David Nichols, Managing Parter and Head of Invention
I had a bit of a ‘marketing moment’ at the gym this week – no one was wearing Nike or Adidas gear. The brand I did notice was Under Armour. UA is a relative newcomer. Launched in 1996 by Kevin Plank (on the right), a then 23-year-old former University of Maryland football player. He began the business from a basement in his grandmother’s house in Washington D.C. It is now a $4bn business and after 23 consecutive quarters of growth it has overtaken Adidas in the US. So how did this happen? Some insights were in a recent Marketing Week interview with Sid Jatia, UA’s VP of Omnichannel Digital.
Here are some key points on what has fuelled UA’s growth:
- Tangible Vision: UA have a clear intent – “Beat Nike to become a $10bn company”. That’s a pretty audacious goal, but one that doesn’t look out of reach. It is a bit of a cliché – the American businessman who talks of being the biggest in the world. However, the vision is both inspiring and practical. Rather than a typically vague vision of “Delivering unmatched customer experiences…” or some such, theirs is a tangible goal that everyone in the company can understand and make relevant to their role. Even if you run a distribution centre in Cleveland, you can benchmark yourself against Nike and strive to outdo them.
- Distinctive brand properties: Under Armour is a highly distinctive brand. First, there is the same itself, which suggests an almost gladiatorial set of kit you put on to go into your personal fitness battle. Then there is the brand symbol, which is just as distinctive as Nike’s swoosh and Adidas’ three stripes, if not more so.
- Glocal not Global: Nike led the charge in making global uniformity sexy hitching a ride with the world’s best sports stars, airing global TV ads & sponsoring the most high profile events in each of its sports. UA seems to be taking a more localised approach. They don’t want to just roll out what worked in the US, using Welsh and British Lions rugby start Jamie Roberts, for example. As Sid Jatia comments: “We need to look at local assets and tap into the fervour in that country.” UA also sign up less well known athletes with the potential to be tomorrow’s champions, using data mining to figure this out. These athletes will be cheaper to sponsor and match the brand’s own underdog status. “We do a tonne of scientific research over how an athlete can perform over the next five to 10 years,” Jatia reveals. “Golfer Jordan Spieth was ranked seven in the world and he’s now the champion. Nike passed on [basketball player] Stephen Curry and went for Kevin Durant as he was the obvious posterboy. We got Curry and now he’s the hottest thing in the NBA.” Now that’s smart.
- Community before Commerce: UA has a fitness community of 165 million users, since their acquisition of MyFitnessPal and MapMyFitness – two major fitness apps. Their strategy is to fit commerce into community, not the other way round, like Nike & Adidas. They want to be there with relevant products to your moment. I love this approach. Flushed with beating my personal best or posting a photo from the peak I have just climbed, UA pops up with a congrats + 20% off new shoes that are in your size & preferred colour – just a click away.
- Go Tech: One of Under Armour’s big bets is on ‘Connected Fitness’ – bringing tech into sports apparel. Nike has been in this field for a while but has yet to see massive game-changing take-up. Under Armour’s plan to get ahead of Nike is to team up with the big tech companies. Apple are developing products in this area and UA are characteristically bold about a tie up, “It would make sense for them to work with Under Armour,” observes Jatia.
Will Under Armour be able to sustain their unstoppable growth? Will Adidas just take it lying down in their home European markets? Will they be able to team up with tech giant Apple and leave Nike in their wake? It’s a bold strategy from an underdog, but in sports that’s where the best stories are.