Marketing Project

Marketing Project

Under Armour

Introduction:

The organization that we are going to select is Under Armour. The core competencies on Under Armour is that they had technologically advanced material that they used for their sports apparel. Under Armour used a polyester blend material for tighter fitting shirts and undergarments that would make it cooler and more comfortable to engage in strenuous activities during high- temperature conditions.

Eventually, they revolutionized their shirts and under garments for cold weather and all season weather. They also sponsor well known athletes to market their apparel and have license agreements with a number of market various accessories and products.

Some of the main missions or objectives for Under Armour are to make all athletes better through passion, design, and the relentless pursuit of innovation. The core values to comprise are " love athletes, stand for equality, fight on together, create fearlessly, to always connect, stay true, think beyond, and celebrate the wins.”

Description of the Organization:

Mission Statement

To make all athletes better through passion, design and the relentless pursuit of innovation.

Overview of History

Under Armour first started in 1996, it first started out as a clothing brand for athletes. The first shirt that launched in 1996 was called “The Shorty”. It was a short, sleeved shirt that was skin-tight, able to stretch, and remove sweat from the fabric with the material it was made from. By being able to remove sweat, it kept athletes dry, light, and cool. This was a groundbreaking shirt that would move Under Armour to a top competing brand.

Under Armour would continue to improve their products so that they can provide for all athletes. In the early 2000s Under Armour grew and they were able to get deals through the NHL, MLB, and USA Basketball. This made it so that Under Armour was seen throughout the media as a top provider for professional athletes. By achieving this Under Armour was able to make footwear and cleats in 2006, becoming the NFL's official footwear supplier.

In the 2010s Under Armour started making sports bras and more footwear. In 2014 Under Armour was the first to make any running shoe in an apparel factory, it was called the “Speed Form Apollo”. This was designed for speed.

Products

Under Armour creates many different products from anywhere from hats, shoes, clothing, and other necessities of athletes. Majority of their product is made from Elastomeric Hard Yarns. With using this kind of fabric, it lasts longer, performs better, and can be recyclable.

Under Armour’s shoes are made from high performance yarns and digital fabrication designs to minimize waste. By doing digital fabrication it reduces greenhouse gas emissions to the atmosphere and Under Armour warehouses can protect the environment from their emissions.

Competitors

NAME

FOUNDED

HEADQUARTERS

EMPLOYEES

Adidas

1924

Herzogenaurach, Germany

59,533

Nike

1964

Beaverton, Oregon, United States

76,700

Puma

1948

Herzogenaurach, Germany

14,332

Skechers

1992

Manhattan Beach, California, United States

13,100

Fila

1911

Seoul, South Korea

1,000

New Balance

1906

Boston, Massachusetts, United States

5,497

Lululemon

1998

Vancouver, Canada

19,000

ASICS

1949

Kobe, Kyogo, Japan

9,030

Recent Accomplishments

Some recent accomplishments from Under Armour include connected fitness and connected footwear. In 2015 Under Armour created the world’s largest digital fitness and wellness community by working with multiple different fitness apps to provide weekly activity goals and achievements to help everyday people improve with their athletic lives.

Connected footwear is another major accomplishment. Under Armour created a shoe that tracks the distance the wearer has run, the duration, time and date, and splits of the running to provide the best capable information to help see where people can improve.

Overall, Under Armour is providing new ways to make people feel proud of working out and being active. They will continue to provide unique ways to make people feel accomplished for the hard work they put in.

Environment:

In the world of athletic apparel, Under Armor stands out because of the quality of their apparel. From the higher end performance of the micro fibers, to the feel received when playing sports, the performance apparel that Under Armor continuously puts out annually keeps them ahead in becoming the industry standard. Under Armor uses top of the line sweat technology matched with an extremely comfortable feel that appeals to the consumer. Through science and innovation, Under Armor strives for greatness in each product they put out.

When examining the market of performance clothing brands naturally our first impression is which professional athlete wears what. Under Armor has knocked this aspect out of the park, signing the likeness of Steph Curry , Tom Brady , The Rock just to name a few. By signing the best of the best it has sparked a new flame to help gain ground on its competitors. A major attraction to athletes signing with Under Armor has been the freedoms in the creative process allowing its athletes to have a hand in the product launch process. This has led to new and returned customers backing their new and improved product lines.

Under Armor is making it an emphasis to give back to communities across the globe. Not only is our object to make a product you’ll feel good wearing, we're doing our part to reduce climate change. Those initiatives include reducing the greenhouse gas emissions by 30% by 2030 as well as achieving net zero greenhouse gas emissions by 2050 as a pledge to Business Ambition.

Objectives:

Under Armour presents the growth strategy “Own the Game” until 2025. This marketing strategy focuses on brand credibility, consumer experience and sustainability. Under armour will focus on the five most important categories for their company which include, Football, Running, Training, Outdoor, and Lifestyle. They will introduce sportswear as a new consumer proposition to address the growing relevance of the sport inspired leisurewear trend. Under Armour is committed to attracting more female consumers. In order to attract more female consumers the company will execute a cross category plan to achieve product excellence and elevate the woman’s experiences. Until 2025, the five categories are expected to account for more than 95% of revenue growth.

Consumers expect to receive a brand and shopping experience with both digital and physical tailored to their preferences. Under Armour aims to have tripled the number in its members of the program from 150 million to around 500 million members.

Financial

• Net income to increase at a rate of between 16% and 18% p.a. on average 2021-2025

• Revenues to increase at a rate of between 8% and 10% p.a. on average 2021-2025

Non financial

• Reducing CO2 footprint per product by 15% by 2025

• Aims to achieve climate neutrality in its own operations by 2025 and overall climate neutrality by 2050

Conduct a SWOT Analysis of the examined organization and describe it in detail- (Austin/CJ)

Strength : Under Armour’s broad overview and wide ranging customers has led to a stronghold in the current market place. While some niche companies entering the same space don’t nearly have as much variety of products as Under armour currently has to offer (footwear, clothing , accessories). Name recognition is a major factor in this industry and I believe that the recent acquisitions of famous athletes have played a major factor In establishing a household name in the market space. The Baltimore-based sports apparel brand used the pandemic to rebuild its image and I see this as a positive as in years past the brand had taken a dip in sales and popularity.

Weakness: Currently the company is struggling to gain international presence compared to its competitors as 83% of revenues is generated from north America. The digital space has been slower than most. Most of their current products on the market are store bought.. The pandemic has put a major hurt financially on the company due to lack of E-Commerce presence and sales.

Opportunities: New product lines with ground breaking technologically is where the company can break through to open new doors and business for the future. With having big name athletes signed to their brand it’s never been a better time to invest into the future than it is now. With little sales outside of North America I see this as being a perfect time to try to gain a different demographic and run trials overseas with new products to see how they stack up against other dominant brands in their field

Threats: The major threats for Under Armor are the typical giants in the industry such as Nike and Adidas. Those two are jockeying for one and two usually every year. With Under Armor being the 3rd name athletic brand they really need to keep up with the others to stay relevant in the athletic space. Customer loyalty is so tough in this space as athletes wear whatever they think will make them look and feel better. If they can continue to keep up hopefully they can create better brand loyalty. Under Armor also dropped in revenue 41% last year which means another threat to them is market uncertainty but a lot of this could do with covid and and also the amount of competition new and old.

Describe the competitors within the respective market (Cole/Brett)

Competitors

Adidas

Adidas is one of the main competitors of Under Armour. Adidas manufactures shoes and apparel. They were founded in 1924 in Germany. They first started making shoes and then in 2006, Adidas bought Reebok and became a big competitor because Adidas first started with shoes but after buying Reebok, Adidas then became a big competitor because Reebok used to make clothing in the 2000s.

Nike

Nike is another large competitor for Under Armour based one their making a of shoes and creating their Dri-Fit apparel which is a head on competition with Under Armour’s stay dry technology. Nike is number one in sport apparel and is Under Armour’s biggest competitor.

Puma

Puma is the third main competitor of Under Armour. Puma was created in 1948 and when Under Armour came into the market it took over where Puma was. Puma was a big apparel brand around the world and with Puma’s continuous marketing with celebrities. With Puma doing this it creates more marketing on a global stage and that is where Puma becomes one main competitor.

Describe the Target markets (Kylee/Taylor)

Target Markets

Under Armour is targeted at male athletes and women with physical and mental strength and want to be better at the sport they do. The goal is to provide athletes with a garment that wicks away sweat and doesn’t get gross. To do so they signed male and female athletes. The company was able to use social media to its advantage by attracting females. Our target markets include males and females who are interested in physical health.

A survey was conducted in 2016 by New York based research firm You Gov. According to the survey, 53% of Under Armour shoppers earn at least $50,000 a year individually, not as a household.

Target Market 1: Under Armour focused on the male athlete demographic in 2004 zeroing in on ages between 17 and 49. This resulted in sales over $200 million. Under Armour signed Tom Brady as a spokesperson which further confirmed its position as a brand for male athletes, specifically football players.

Target Market 2: In 2014 Under Armour decided to target the female demographic. They signed a ballerina who told the story and appealed to not only female athletes but all females who has the physical and mental strength to tune out the external pressures. Under Armour was able to increase its women’s sales by 28% and its overall website traffic by 42%.

Austin/ Cole-

Financial Goals

• Net income to increase at a rate of between 16% and 18% p.a. on average 2021-2025

• Revenues to increase at a rate of between 8% and 10% p.a. on average 2021-2025

Non-financial Goals

• Reducing CO2 footprint per product by 15% by 2025

• Aims to achieve climate neutrality in its own operations by 2025 and overall climate neutrality by 2050

To achieve these goals, Under Armor plans to take all necessary actions to consistently deliver what consumers, customers, and shareholders expect from the company. By doing this, Under Armor will have to focus on continued innovation and creating deeper connections through brand experiences.

-The strategy or strategies that will be used to achieve the marketing goals should be described

-All of the marketing mix variables need to be described

Brett/ CJ-

-For the product variable, the core product and product extensions should be described

-The operational variable should describe how the product is distributed to the consumer. In the sport marketing mix, an operational description generally focuses on the facility, broadcasting, Internet and ticketing

- The promotional mix should describe the sales promotions, personal selling, advertising, and direct marketing components

As we continue to look at the strategies under armor follows, it is important to note that they are a leader in the sports performance apparel industry. Under Armor is known for creating product lines for all genders and focusing on HeatGear, ColdGear and AllSeasonGear as well as street wear.

Sales/ promotions / Personal selling:

Promotions / advertising: Upon research Under Armour has taken a unique path with the way they go about promotions. The brand has chosen to not outsource its marketing and use its resources they have in house. The company uses platforms such as billboards, tv advertisements and social media campaigns to increase attention for its products. The Biltmore company invested nearly $579 million in promotional techniques in t 2019 with the goal in mind to focus on impactful sporting partnerships while trying to acquire celebrity endorsements (Tom Brady, Steph Curry,The Rock and Cam Newton).

Personal selling: Personal selling had been one of the strong suits the company had going in its favor, however once the pandemic hit the company was not able to see the same amount of foot traffic as they would like. The reason Under Armor was so successful before the lockdowns was because of their infrastructure they had in place. Having many brick and mortar facilities across the United States was a driving force for sales compared to their online sales portion.

Sales: Under Armour uses value-based pricing strategy for its products as they are known for their advanced quality. They are able to command a superior price as they bring to the table innovative materials and fabrics on their products. The reason sales are able to compete with Nike and Adidas is due to the known value and excellence associated with the brand.

Kylee/ Taylor-

-Public relations variable should describe the community and media relation functions. In describing the two functions, pertinent public relations tools should be discussed. Additionally, a press release or blogs should be developed for the media relations function. Either one of those journalistic tools should follow the format outlined in the lecture notes on public relations

-the pricing variable should discuss the pricing objectives and pricing strategies to be formulated by the organization

Public relations can be defined as the promotional mix function which evaluates public attitudes, identifies policies and procedures of an entity designed to evoke public interest and to execute a program of action to earn public acceptance and understanding. The primary objective of public relations is to draw publicity to products or a particular organization. The public relations function is composed of two components. First, the community relations is designed to increase the visibility of an organization. The goal is to generate goodwill for an entity or its products by gaining public acceptance.

Community relations using pertinent tools

Under Armour supports communities by funding four primary areas: education, activity, mentorship, and service.

Under Armour supports “Soccer Without Borders”. Soccer Without Borders uses sport as a vehicle to serve newcomer refugee, asylee, and immigrant children through after school and summer programs.

Second, the media relations component is designed to obtain free publicity for the sport organization. It is to provide immediate results through broadcasting, print and other forms of media exposure. Media relation tools are needed to find or create favorable news about the organization and make the news interesting with timely stories to the media while competing with all other events going on during the day.

Press release

"Today's announcement underscores our commitment to delivering an ecosystem capable of deepening our connection with focused performers, inspiring them wherever and whenever they choose to engage our brand," said Under Armour President and Chief Executive Officer Patrik Frisk. "Massimo's global leadership skills, digital expertise, and significant experience building brands through understanding consumer behavior will be a great enabler in strengthening our ability to innovate and enhance our position as one of the world's preeminent athletic performance brands."

SOURCE Under Armour, Inc.

Lance Allega, SVP, Investor Relations & Corporate Development, (410) 246-6810; Blake Simpson, SVP, Global Communications, Community Impact & Events, (443) 630-9959

Describe pricing variable as it relates to under armour

Under Armour alters the price of a product based on the current levels of supply and demand.

Objectives

• Accurately forecast demand for products

• Anticipate consumer preferences

• Successfully develop and introduce new, innovative and updated products

Strategies: Under Armour uses a value-based pricing strategy for its products as they are known for their advanced quality. Although Under Armour has many competitors, they are able to price their products above industry average as their main target market is athletes, so they focus on fabric technology and quality of product over cost of product.