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Arthur A. Thompson The University of Alabama
Founded in 1996 by former University of Maryland football player Kevin Plank, Under Armour was the originator of sports apparel made with performance-enhancing fabrics—gear engineered to wick moisture from the body, regulate body temperature, and enhance comfort regardless of weather conditions and activity levels. It started with a simple plan to make a T-shirt that provided compres- sion and wicked perspiration off the wearer’s skin, thereby avoiding the discomfort of sweat-absorbed apparel. Under Armour’s innovative synthetic perfor- mance fabric T-shirts were an instant hit.
Nearly 20 years later, with 2015 revenues of $3.9 billion, Under Armour had a growing brand pres- ence in the roughly $70 billion multisegment retail market for sports apparel, activewear, and athletic footwear in the United States. Its interlocking “U” and “A” logo was almost as familiar and well-known as industry-leader Nike’s swoosh. Heading into 2016, Under Armour had an estimated 16 percent share of the United States market for sports apparel (up from 12.7 percent in 2012 and 11.1 percent in 2011).1 In the synthetic performance apparel segment—a mar- ket niche with estimated U.S. sales close to $7 billion in 2015—Under Armour’s market share was thought to exceed 35 percent.
However, across all segments (sports apparel, activewear, and athletic footwear) of the $250 billion global market in which the company competed, Under Armour still had a long way to go to overtake
the two long-time industry leaders—Nike and The adidas Group. In fiscal 2015, Nike had U.S. sales of $11.3 billion and global sales of $30.6 billion, and it dominated both the U.S. and global markets for athletic footwear. In the United States, Nike’s share of athletic footwear sales approached 60 percent (counting its Nike-branded footwear and sales of its Jordan and Converse brands) versus Under Armour’s less than 3 percent share. Nike’s 2015 global sales of athletic footwear were $18.3 billion (over 1 million pairs per day), dwarfing Under Armour’s 2015 global footwear sales of $678 million. Germany- based The adidas Group—the industry’s second- ranking company in terms of global revenues—had 2015 global sales of €16.9 billion (equivalent to about $18.8 billion), which included athletic footwear sales of €8.4 billion ($9.3 billion) and sports apparel sales of €7.0 billion ($7.7 billion).
Despite having global sales much smaller than its two global rivals, Under Armour was gaining ground and making its market presence felt. In North Amer- ica, Under Armour had recently overtaken adidas to become the second largest seller of sports apparel, activewear, and athletic footwear.2 Under Armour’s 2015 North American sales of $3.56 billion were over 15 percent greater than The Adidas Group’s 2015 North American sales of €2.75 billion (equivalent to about $3.03 billion). Moreover, Under Armour was
Under Armour’s Strategy in 2016—How Big a Factor Can the Company Become in the $250 Billion Global Market for Sports Apparel and Footwear?
Copyright © 2016 by Arthur A. Thompson. All rights reserved
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his mother, who was the town mayor of Kensington, Maryland. When he was a high-school sophomore, he was tossed out of Georgetown Prep for poor academic performance and ended up at Fork Union Military Academy, where he learned to accept discipline and resumed playing high school football. After gradua- tion, Plank became a walk-on special-teams football player for the University of Maryland in the early 1990s, ending his college career as the special-teams’ captain in 1995. Throughout his football career, he regularly experienced the discomfort of practicing on hot days and the unpleasantness of peeling off sweat- soaked cotton T-shirts after practice.
During his later college years and in classic entrepreneurial fashion, Plank hit on the idea of using newly available moisture-wicking, polyester- blend fabrics to make next-generation, tighter-fitting shirts and undergarments that would make it cooler and more comfortable to engage in strenuous activi- ties during high-temperature conditions.3 While Plank had a job offer from Prudential Life Insurance at the end of his college days in 1995, he couldn’t see himself being happy working in a corporate environment—he told the author of a 2011 For- tune article on Under Armour, “I would have killed myself.”4 Despite a lack of business training, Plank opted to try to make a living selling high-tech microfi- ber shirts. Plank’s vision was to sell innovative, tech- nically advanced apparel products engineered with a special fabric construction that provided supreme moisture management. A year of fabric and product testing produced a synthetic compression T-shirt that was suitable for wear beneath an athlete’s uniform or equipment, provided a snug fit (like a second skin), and remained drier and lighter than a traditional cot- ton shirt. Plank formed KP Sports as a subchapter S corporation in Maryland in 1996 and commenced selling the shirt to athletes and sports teams.
The Company’s Early Years Plank’s former teammates at high school, military school, and the University of Maryland included some 40 NFL players that he knew well enough to call and offer them the shirt he had come up with. He worked the phone and, with a trunk full of shirts in the back of his car, visited schools and train- ing camps in person to show his products. Within a short time, Plank’s sales successes were good enough that he convinced Kip Fulks, who played
growing at a faster percentage rate than both its big- ger rivals. From 2010 through 2015, Under Armour’s sales revenues grew at a compound annual rate of 30.1 percent. Nike’s revenues from Nike Brand prod- ucts during its most recent five fiscal years (June 1, 2010–May 31, 2015) grew at an 11.75 percent com- pound rate. Total revenues of The adidas Group grew at a compound rate of 7.1 percent during 2010–2015. But because Under Armour’s revenues were much smaller than those of Nike and The adidas Group, its faster percentage rate of revenue growth did not translate into bigger revenue gains in absolute dollar terms. Under Armour’s global revenues grew by just under $880 million in 2015. Nike’s global revenues in 2015 were $2.8 billion above the 2014 level, more than three times greater than UA’s dollar increase in revenues. The adidas Group’s 2015 revenue gain of €2.4 billion (about $2.66 billion) was three times bigger than UA’s dollar increase in revenues. So, in term of dollar revenues, Under Armour fell further behind Nike and The adidas Group in 2015. Conse- quently, it would take many years, if ever, for Under Armour’s revenues to approach those of Nike, which touted itself as a growth company and was led by top executives intent on preserving Nike’s standing as the global marker leader.
Nonetheless, founder and CEO Kevin Plank believed Under Armour’s potential for long-term growth was exceptional for three reasons: (1) the com- pany had built an incredibly powerful and authentic brand in a relatively short time, (2) there were signifi- cant 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, and (3) the company was only in the early stages of establishing its brand and penetrating markets outside North America. Plank’s revenue objectives for Under Armour were global sales of $7.5 billion in 2018 and $10 billion in 2020. If these objectives were met and if Under Armour’s strategy proved powerful enough to sustain a revenue growth rate of 20 per- cent or more for another 5 to 10 years thereafter, then Plank’s vision of Under Armour becoming a major player on the global stage would be fulfilled.
COMPANY BACKGROUND Kevin Plank honed his competitive instinct growing up with four older brothers and playing football. As a young teenager, he squirmed under the authority of
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not just to provide gear for a particular team but for most or all of a school’s sports teams. However, the company’s partners came to recognize the merits of tapping the retail market for high-performance apparel and began making sales calls on sports apparel retailers. In 2000, Galyan’s, a large retail chain since acquired by Dick’s Sporting Goods, signed on to carry KP Sports’s expanding line of performance apparel for men, women, and youth. Sales to other sports apparel retailers began to explode, quickly making the retail segment of the sports apparel market the biggest component of the company’s revenue stream. KP Sports had revenues totaling $5.3 million in 2000, with operating income of $0.7 million. The company’s products were avail- able in some 500 retail stores. Beginning in 2000, Scott Plank, Kevin’s older brother, joined the com- pany as vice president of finance, with operational and strategic responsibilities as well.
Rapid Growth Ensues Over the next 15 years, the company’s product line evolved to include a widening variety of shirts, shorts, underwear, outerwear, gloves, and other offerings. The strategic intent was to grow the busi- ness by replacing products made with cotton and other traditional fabrics with innovatively designed performance products that incorporated a variety of technologically advanced fabrics and special- ized manufacturing techniques, all in an attempt to make the wearer feel “drier, lighter, and more com- fortable.” In 1999 the company began selling its products in Japan through a licensee. On January 1, 2002, prompted by growing operational complex- ity, increased financial requirements, and plans for further geographic expansion, KP Sports revoked its ‘‘S’’ corporation status and became a ‘‘C’’ cor- poration. The company opened a Canadian sales office in 2003 and began efforts to grow its market presence in Canada. In 2004, KP Sports became the outfitter of the University of Maryland football team and was a supplier to some 400 women’s sports teams at NCAA Division 1-A colleges and univer- sities. The company used independent sales agents to begin selling its products in the United Kingdom in 2005. SportsScanINFO estimated that as of 2004, KP Sports had a 73 percent share of the U.S. market for compression tops and bottoms, more than seven times that of its nearest competitor.7
lacrosse at Maryland, to become a partner in his enterprise. Fulks’s initial role was to leverage his connections to promote use of the company’s shirts by lacrosse players. Their sales strategy was predicated on networking and referrals. But Fulks had another critical role—he had good credit and was able to obtain 17 credit cards that were used to make pur- chases from suppliers and charge expenses.5 Opera- tions were conducted on a shoestring budget out of the basement of Plank’s grandmother’s house in Georgetown, a Washington, DC, suburb. Plank and Fulks generated sufficient cash from their sales efforts that Fulks never missed a minimum pay- ment on any of his credit cards. When cash flows became particularly tight, Plank’s older brother Scott made loans to the company to help keep KP Sports afloat (in 2011 Scott owned 4 percent of the company’s stock). It didn’t take long for Plank and Fulks to learn that it was more productive to direct their sales efforts more toward equipment managers than to individual players. Getting a whole team to adopt use of the T-shirts that KP Sports was selling meant convincing equipment managers that it was more economical to provide players with a pricey $25 high-performance T-shirt that would hold up better in the long run than a cheap cotton T-shirt.
In 1998, the company’s sales revenues and growth prospects were sufficient to secure a $250,000 small business loan from a tiny bank in Washington, DC; the loan enabled the company to move its basement operation to a facility on Sharp Street in nearby Baltimore.6 As sales continued to gain momentum, the DC bank later granted KP Sports additional small loans from time to time to help fund its needs for more working capital. Then Ryan Wood, one of Plank’s acquaintances from high school, joined the company in 1999 and became a partner. The company consisted of three jocks trying to gain a foothold in a growing, highly competitive industry against some 25+ brands, including those of Nike, adidas, Columbia, and Patagonia. Plank functioned as president and CEO; Kip Fulks was vice president of sourcing and quality assurance, and Ryan Wood was vice president of sales.
KP Sports’s sales grew briskly as it expanded its product line to include high-tech undergarments tailored for athletes in different sports and for cold temperatures as well as hot temperatures, plus jer- seys, team uniforms, socks, and other accessories. Increasingly, the company was able to secure deals
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entities. Wood decided to leave his position as senior vice president of sales at Under Armour in 2007 to run a cattle farm. Fulks assumed the position of chief operating officer at Under Armour in September 2011, after moving up the executive ranks in several capacities, chiefly those related to sourcing, qual- ity assurance, product development, and product innovation. In November 2015, following several changes in title and responsibility, Fulks was named chief marketing officer. In September 2012, Scott Plank, who was serving as the company’s executive vice president of business development after hold- ing several other positions in the company’s execu- tive ranks, retired from the company to start a real estate development company and pursue his passion for building sustainable urban environments.
Exhibit 1 summarizes Under Armour’s financial performance during 2011–2015. Exhibit 2 shows the growth of Under Armour’s quarterly revenues for 2010 through 2015. The company’s strong financial per- formance propelled its stock price from $46 in early January 2013 to a high of $124 in March 2014; the stock split 2-for-1 in April 2014. The stock price was trading in the split-adjusted range of $80–$85 in March 2016, up over about 365 percent since March 2010.
In 2015, the company announced that a new C class of nonvoting stock would be created and that in 2016 the owner of each existing share of Class A and Class B stock would receive one share of non- voting Class C stock that would be traded on the New York Stock Exchange under a different symbol (UA.C). This distribution was effectively a 2-for-1 stock split; after the distribution, Class B stock would cease to exist. The purpose of these changes was to preserve Kevin Plank’s voting power—the dual Class A and Class B voting structure was set to end when Kevin Plank owned fewer than 15 percent of the total Class A and Class B shares outstanding (his ownership percentage was just under 16 percent in mid-2015). It was further announced that the non- voting Class C shares would in the future be used for all equity-based employee compensation (stock bonuses and stock option grants) and for any stock- based acquisitions. Kevin Plank thus ended up with the same roughly 16 percent voting interest after the Class C stock distribution in April 2016 as before the distribution, a percentage he and the board of directors deemed big enough to protect the com- pany’s current governance structure from unwanted outside takeover.
As of 2005, about 90 percent of the company’s revenues came from sales to some 6,000 retail stores in the United States and 2,000 stores in Canada, Japan, and the United Kingdom. In addition, sales were being made to high-profile athletes and teams, most notably in the National Football League, Major League Baseball, the National Hockey League, and major collegiate and Olympic sports. KP Sports had 574 employees at the end of September 2005.
KP Sports Is Renamed Under Armour In late 2005, KP Sports changed its name to Under Armour and became a public company with an initial public offering (IPO) of 9.5 million shares of Class A common stock that generated net pro- ceeds of approximately $114.9 million. Simultane- ously, existing stockholders sold 2.6 million shares of Class A stock from their personal holdings. The shares were all sold at just above the offer price of $13 per share; on the first day of trading after the IPO, the shares closed at $25.30, after opening at $31 per share. Following these initial sales of Class A Under Armour stock to the general public, Under Armour’s outstanding shares of common stock con- sisted of two classes: Class A common stock and Class B common stock. Holders of Class A common stock were entitled to one vote per share, and holders of Class B common stock were entitled to 10 votes per share, on all matters to be voted on by common stockholders. All of the Class B common stock was beneficially owned by Kevin Plank, giving him 83.0 percent of the combined voting power of all the outstanding common stock and the ability to control the outcome of substantially all matters submitted to a stockholder vote, including the election of direc- tors, amendments to Under Armour’s charter, and mergers or other business combinations.
At the time of Under Armour’s IPO, Kevin Plank, Kip Fulks, and Ryan Wood were all 33 years old; Scott Plank was 39 years old. After the IPO, Kevin Plank owned 15.2 million shares of Under Armour’s Class A shares (and all of the Class B shares), Fulks owned 2.125 million Class A shares, Wood owned 2.142 million Class A shares, and Scott Plank owned 3.95 million Class A shares. All four had opted to sell a small fraction of their common shares at the time of the IPO—these accounted for a combined 1.83 million of the 2.6 million shares sold from the holdings of various directors, officers, and other
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Selected Income Statement Data 2015 2014 2013 2012 2011
Net revenues $3,963,313 $3,084,370 $2,332,051 $1,834,921 $1,472,684
Cost of goods sold 2,057,766 1,152,164 1,195,381 955,624 759,848
Gross profit 1,905,547 1,512,206 1,136,670 879,297 712,836
Selling, general and administrative expenses 1,497,000 1,158,251 871,572 670,602 550,069
Income from operations 408,547 353,955 265,098 208,695 162,767
Interest expense, net (14,628) (5,335) (2,933) (5,183) (3,841)
Other expense, net (7,234) (6,410) (1,172) (73) (2,064)
Income before income taxes 386,685 342,210 260,993 203,439 156,862
Provision for income taxes 154,112 134,168 98,663 74,661 59,943
Net income $ 232,573 $ 208,042 $ 162,330 $ 128,778 $ 96,919
Net income per common share
Basic $ 1.08 $ 0.98 $ 0.77 $ 0.62 $ 0.47
Diluted 1.05 0.95 0.75 0.61 0.46
Weighted average common shares outstanding
Basic 215,498 213,227 210,696 208,686 206,280
Diluted 220,868 219,380 215,958 212,760 210,104
Selected Balance Sheet Data (in 000s)
Cash and cash equivalents $ 129,852 $ 593,175 $ 347,489 $ 341,841 $ 175,384
Working capital* 1,019,953 1,127,772 702,181 651,370 506,056
Inventories at year-end 783,031 536,714 469,006 319,286 324,409
Total assets 2,868,900 2,095,083 1,577,741 1,157,083 919,210
Total debt and capital lease obligations, including current maturities 669,000 284,201 152,923 61,889 77,724
Total stockholders’ equity 1,668,222 1,350,300 1,053,354 816,922 636,432
Selected Cash Flow Data
Net cash provided by operating activities ($ 44,104) $ 219,033 $ 120,070 $ 199,761 $ 15,218
*Working capital is defined as current assets minus current liabilities.
Sources: Company 10-K reports for 2015, 2013, and 2012.
EXHIBIT 1 selected Financial Data for Under Armour, Inc., 2011–2015 (in 000s, except per share amounts)
UNDeR ARMOUR’s sTRATeGY IN 2016 Under Armour’s mission was “to make all athletes better through passion, design, and the relentless pursuit of innovation.” The company’s principal business activities in 2016 were the development, marketing, and distribution of branded performance apparel, footwear, and accessories for men, women,
and youth. The brand’s moisture-wicking apparel products were engineered in many designs and styles for wear in nearly every climate to provide a per- formance alternative to traditional products. Under Armour sport apparel was worn by athletes at all levels, from youth to professional, and by consum- ers with active lifestyles. In 2013, Under Armour acquired MapMyFitness, a provider of website ser- vices and mobile apps to fitness-minded consumers
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activities. In 2016, the special emphasis being placed on products for women was expected to result in women’s sales of $1 billion.
∙ Targeting additional consumer segments for the company’s ever-expanding lineup of performance products.
∙ Increasing its sales and market share in the ath- letic footwear segment.
∙ Securing additional distribution of Under Armour products in the retail marketplace in North America via not only store retailers and catalog retailers but also through Under Armour factory outlet and specialty stores and sales at the com- pany’s website.
∙ Expanding the sale of Under Armour products in foreign countries and becoming a global competi- tor in the world market for sports apparel, athletic footwear, and performance products.
∙ Growing global awareness of the Under Armour brand name and strengthening the appeal of Under Armour products worldwide.
∙ Growing the company’s connected fitness business.
Product Line Strategy For a number of years, expanding the company’s product offerings and marketing them at multi- ple price points had been a key element of Under Armour’s strategy. The goal for each new item added to the lineup of offerings was to provide consumers with a product that was a superior
across the world; Under Armour used this acquisi- tion, along with several follow-on acquisitions in 2014–2015, to create what it termed a “connected fitness” business offering digital fitness subscrip- tions and licenses, mobile apps, and other fitness- tracking and nutritional tracking solutions to athletes and fitness-conscious individuals across the world. Kevin Plank expected the company’s connected fit- ness strategic initiative to become a major revenue driver in the years to come—in 2015, UA’s con- nected fitness revenues grew by 178 percent and generated 1.3 of total net revenues.
In 2015, 70.7 percent of Under Armour’s total net sales were apparel items, with athletic footwear products, accessories, and connected fitness offer- ings accounting for the remainder—see Exhibit 3A. Just over 87 percent of Under Armour’s 2015 sales were in North America; however, UA’s top execu- tives believed the company’s international presence was still in the infant stage (Exhibit 3B) and that there was a huge opportunity for the company to grow sales to distributors and retailers outside North America by 30 to 50 percent annually for many years to come.
Growth Strategy The company’s growth strategy in 2016 consisted of seven strategic initiatives:
∙ Continuing to broaden the company’s product offerings to men, women, and youth for wear in a widening variety of sports and recreational
Quarter 1 (Jan.–March)
Quarter 2 (April–June)
Quarter 3 (July–Sept.)
Quarter 4 (Oct.–Dec.)
Percent Change from Prior Year’s Quarter 1 Revenues
Percent Change from Prior Year’s Quarter 2 Revenues
Percent Change from Prior Year’s Quarter 3 Revenues
Percent Change from Prior Year’s Quarter 4
2010 $229,407 14.7% $204,786 24.4% $ 328,568 21.9% $ 301,166 35.5%
2011 312,699 36.3% 291,336 42.3% 465,523 41.7% 403,126 33.9%
2012 384,389 23.0% 369,473 26.8% 575,196 23.6% 505,863 25.5%
2013 471,608 22.7% 454,541 23.0% 723,146 25.7% 682,756 35.0%
2014 641,607 36.0% 609,654 34.1% 937,908 29.7% 895,201 31.1%
2015 804,941 25.5% 783,577 28.5% 1,204,109 28.4% 1,170,686 30.8%
EXHIBIT 2 Growth in Under Armour’s Quarterly Revenues, 2010–2015 (in 000s)
Sources: Company 10-K reports, 2015, 2013, 2012, and 2010.
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In sharp contrast to a sweat-soaked cotton T-shirt that could weigh two to three pounds, HeatGear was engineered with a microfiber blend featuring what Under Armour termed a “Moisture Transport Sys- tem” that ensured the body would stay cool, dry, and light. HeatGear was offered in a variety of tops and bottoms in a broad array of colors and styles for wear in the gym or outside in warm weather.
ColdGear Under Armour high-performance fab- rics were appealing to people participating in cold- weather sports and vigorous recreational activities like snow skiing who needed both warmth and moisture-wicking protection from a sometimes overheated body. ColdGear was designed to wick moisture from the body while circulating body heat from hotspots to maintain core body temperature. All ColdGear apparel provided dryness and warmth in a single light layer that could be worn beneath a jersey, uniform, protective gear or ski-vest, or other cold-weather outerwear. ColdGear products gener- ally were sold at higher price levels than other Under
alternative to the traditional products of rivals— striving to always introduce a superior product would, management believed, help foster and nour- ish a culture of innovation among all company per- sonnel. According to Kevin Plank, “we focus on creating products you don’t know you need yet, but once you have them, you won’t remember how you lived without them.”8
Apparel The company designed and merchan- dised three lines of apparel gear intended to regulate body temperature and enhance comfort, mobility, and performance regardless of weather conditions: HEATGEAR® for hot-weather conditions, COLD- GEAR® for cold-weather conditions, and ALLSEA- SONGEAR® for temperature conditions between the extremes.
HeatGear HeatGear was designed to be worn in warm to hot temperatures under equipment or as a single layer. The company’s first compression T-shirt was the original HeatGear product and was still one of the company’s signature styles in 2015.
EXHIBIT 3 Composition of Under Armour’s Revenues, 2012–2015
B. Net Revenues by Geographic Region (in thousands of $)
2015 2014 2013 2012
Dollars Percent Dollars Percent Dollars Percent Dollars Percent
North America $3,455,737 87.2% $2,796,374 90.7% $2,193,739 94.1% $ 997,816 93.7%
International 454,161 11.5 268,771 8.7 138,312 5.9 66,111 6.3
Connected fitness 53,415 1.3 19,225 0.6 1,068 0.0 — —
Total net revenues $3,963,313 100.0% $3,084,370 100.0% $2,332,051 100.0% $1,063,927 100.0%
Sources: Company 10-K reports, 2015, 2013, 2012 and 2010.
2015 2014 2013 2012
Dollars Percent Dollars Percent Dollars Percent Dollars Percent
Apparel $2,801,062 70.7% $2,291,520 74.3% $1,762,150 75.6% $ 853,493 80.2%
Footwear 677,744 17.1 430,987 14.0 298,825 12.8 127,175 12.0
Accessories 346,885 8.8 275,409 8.9 216,098 9.3 43,882 4.1
Total net sales $3,825,691 96.6% $2,997,916 97.2% $2,277,073 97.6% $1,024,550 96.3%
License revenues 84,207 2.1 67,229 2.2 53,910 2.4 39,377 3.7
Connected fitness 53,415 1.3 19,225 0.6 1,068 0.0 — —
Total net revenues $3,963,313 100.0% $3,084,370 100.0% $2,332,051 100.0% $1,063,927 100.0%
A. Net Revenues by Product Category (in thousands of $)
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In early 2014, UA introduced a new premium run- ning shoe, the SpeedForm Apollo, with a retail price of $100. Kevin Plank believed this new shoe model, which was a follow-on to the $120 SpeedForm RC introduced in 2013, had the potential to be one of the company’s defining products and help take UA to the next level in the market for athletic footwear, particularly in the running shoe category where the company was striving to make major inroads. UA’s marketing tagline for the SpeedForm Apollo was “this is what fast feels like.”
To capitalize on a recently signed long-term endorsement contract with pro basketball superstar Stephen Curry, Under Armour began marketing a Stephen Curry Signature line of basketball shoes in 2014; the so-called Curry One models had a price point of $120. This was followed by a Curry Two collection in 2015 at a price point of $130, a Curry 2.5 collection (at a price point of $135) during the NBA playoffs in May–June 2016, and a Curry Three collection in fall 2016. Under Armour sought to leverage its signing of pro golfer Jordan Spieth to a 10-year endorsement contract in early 2015 by introducing an all-new golf shoe collection in April 2016—Spieth had a spectacular year on the Profes- sional Golf Association (PGA) tour in 2015 and was named 2015 PGA Tour Player of the Year, an honor based on votes by his peers; the 2016 golf shoe col- lection had three styles, ranging in price from $160 to $220. Also in 2016, Under Armour debuted its first “smartshoe” (called the SpeedForm Gemini 2 Record Equipped) at a price point of $150; smartshoe models were equipped with the capability to connect automatically to UA’s connected fitness website and record certain activities in the wearer’s fitness track- ing account. Another high-tech shoe introduced in Q1 2016, called the UA Architect and priced at $300, had a 3-D printed midsole; initial supplies sold out in 19 minutes at the company’s website. New 3-D iterations were scheduled for launch later in 2016.
To support the company’s attempt to rapidly grow its sales of athletic footwear, UA had doubled the size of its footwear team to 230 people in 2015 and planned to add more staff in time for the 2016 Summer Olympics and other important 2016 sport- ing events.
Accessories Under Armour’s accessory line in 2016 included gloves, socks, headwear, bags, knee- pads, custom-molded mouth guards, inflatable
Armour gear lines. A new ColdGear Infrared line, with a new fabric technology, was introduced in fall 2013 and in 2015 zip-up ColdGear items utilized the company’s MagZip™ zippers, a magnetic quick zip closure that the company claimed “fixed zippers.”
AllSeasonGear AllSeasonGear was designed to be worn in temperatures between the extremes of hot and cold and used technical fabrics to keep the wearer cool and dry in warmer temperatures while preventing a chill in cooler temperatures.
Each of the three apparel lines contained three fit types: compression (tight fit), fitted (athletic fit), and loose (relaxed). In 2016, Under Armour intro- duced apparel items containing MicroThread, a fab- ric technology that used elastomeric (stretchable) thread to create a cool moisture-wicking microcli- mate, prevented clinging and chafing, allowed gar- ments to dry 30 percent faster and be 70 percent more breathable than similar Lycra construction, and were so lightweight as to “feel like nothing.” It also began using a newly developed insulation called Reactor in selected ColdGear items and introduced a new apparel collection with an exclusive CoolS- witch coating on the inside of the fabric that pulled heat away from the skin, allowing the wearer to feel cooler and perform longer.
Footwear Under Armour began marketing footwear products for men, women, and youth in 2006 and has expanded its footwear line every year since. Its 2016 offerings included football, base- ball, lacrosse, softball, and soccer cleats; slides; performance training footwear; running footwear; basketball footwear; golf shoes; and outdoor foot- wear. Under Armour’s athletic footwear was light, breathable, and built with performance attributes for athletes. Innovative technologies (Charged Cushion- ing®, ClutchFit®, Micro G®, and SpeedForm®) were used to provide stabilization, directional cushioning, and moisture management, and all models and styles were engineered to maximize the wearer’s comfort and control.
New footwear collections for men, women, and youth were introduced regularly, sometimes monthly and often seasonally. Most new models and styles incorporated fresh technological features of one kind or another. Since 2012, Under Armour had more than tripled the number of footwear styles/models priced above $100 per pair. Its best-selling offerings were in the basketball and running shoe categories.
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was the second-best-selling item (behind Curry Two footwear models) on UA’s e-commerce website in the first quarter of 2016. Kevin Plank was so enthusias- tic about the long-term potential of Under Armour’s connected fitness business that he had boosted the company’s team of engineers and software develop- ers from 20 to over 350 during 2014–2015.
Licensing Under Armour had licensing agree- ments with a number of firms to produce and market Under Armour apparel, accessories, and equipment. Under Armour product, marketing,
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