Under Armour:Competitor and Market Analysis

Brian TeufelMGT 490-004Assignment #2

Professor McDermottMarch 17, 2011

Key Competitors

Other Competitors

Company PA Sales (in millions)

Total Sales(in millions)

PA sales as % of total sales

% of sales spent on R&D

Under Armour $853 $1,060 81% 33%

Nike $1,300 $19,014 7% 12%

Adidas $1,150 $11,990 9% 5%

Columbia Sportswear Company

$400 $1,484 27% 1%

Sugoi $34 $85 40% 2%

PUMA $425 $2,862 15% 4%

Quiksilver $250 $1,834 14% 3%

North Face $300 $1,400 21% 3%

New Balance Private Company

Private Company

Private Company

Private Company

Performance Apparel Industry

• New Balance• Columbia Sportswear Company• Champion

• Nike• Adidas• Under Armour

• PUMA• The North Face• Quiksilver

Generic Strategy Competitive Advantage

Low Cost Differentiation

Competitive Scope

BroadTarget

Narrow Target

Price/QualityComparison

Price

Low High

Quality

Low

High

•Under Armour

•New Balance

•Columbia Sportswear Company

•Champion

•Nike•Adidas

•PUMA

•The North Face

•Quiksilver

Sales

U.S.Europe Asia/PacificRest of North America and South Amer-icaAfricaAustralia

64%

4%

9%

1%

Performance Apparel Industry Geographic Breakdown

20%

2%

Performance Apparel Geographic Growth Rates by Company

-UA = 23.5%-Nike = 8% -Adidas = 7%-Col. Sportswear = 22%-Quiksilver = (-9%)-PUMA = 22%

-UA = 0%-Nike = 20%-Adidas = 14%-Col. Sportswear = 10%-Quiksilver = (-9%)-PUMA = 22%

-UA = 0%-Nike = 20%-Adidas = 16%-Col. Sportswear = 13%-Quiksilver = N/A-PUMA = -3%

-UA =5%-Nike = 0%-Adidas = 2%-Col. Sportswear = 30%-Quiksilver = 4%-PUMA = (-2&)

-UA = 4%-Nike = (-6%) -Adidas = 7%-Col. Sportswear = 13%-Quiksilver = (-8%)-PUMA = (-3%)

Company Core Competence/Competencies

Core Competencies -Weak/Moderate/Strong

Under Armour Innovation, Quality, R&D Strong

Nike Inspiration, Innovation, Brand Image/Loyalty

Strong

Adidas Innovation, Technology, Sustainability

Strong

Columbia Sportswear Company

Distribution, Outerwear Moderate

Sugoi Quality, Bicycle-wear Moderate

PUMA Sustainability, Value, International Football

Moderate

Quiksilver Surfwear, Quality Moderate

North Face Innovation, OuterwearEnvironmental Awareness

Moderate

New Balance Footwear, Innovation, Customer Service

Weak

Champion Comfort, Quality Weak

Company Key Brands Product Scope

Under Armour Under Armour Apparel, Footwear, Accessories

Nike Nike, Nike Golf, Air Jordan, Cole Haan, Hurley, Converse, Umbro, ect…

Apparel, Footwear, Sporting Equipment, Accessories, Caps

Adidas Adidas, Reebok, Taylor Made Golf

Apparel, Personal Care, Footwear, Sporting Equipment, Accessories, Caps

Columbia Sportswear Company

Columbia Sportswear, Mountain Hardware, Sorel,Pacific Trail

Apparel, Footwear, Accessories

Sugoi Subsidiary of Dorel Industries Inc.

Apparel, Accessories

PUMA Puma, Cobra Golf, Tretorn Apparel, Footwear, Sporting Equipment, Accessories

Quiksilver Quiksilver, DC, Roxy, Hawk Apparel, Footwear, Accessories, Sporting Equipment

North Face Subsidiary of VF Corporation

Apparel, Sporting Equipment, Camping Equipment, Accessories

New Balance New Balance, Dunham, Aravon, Warrior, Brine

Apparel, Footwear, Accessories

Champion Subsidiary of Hanes brands Apparel, Footwear, Accessories

Company Target Market Market Power(Low/Moderate/High)

Under Armour Male and female, anyone who wants to enhance performance and comfort

High

Nike Male and female, ages 18-35, physically active, athletes

High

Adidas Male and female, physically active, athletes

Moderate

Columbia Sportswear

Male and female, physically active, loves outdoor activities

Moderate

Sugoi Male and Female, physically active,loves biking and running

Low

PUMA Male and Female, physically active,loves soccer (international football)

Moderate

Quiksilver Male and female, young adult (ages 15-35), love warm weather activities (surfing/skating)

Low

North Face Male and female, young adult (ages 16-35), love cold weather activity

Low

New Balance Male and female, older adults (ages 35+), love walking/running

Low

Champion Male and female, hard working, physically active, all ages

Low

Performance Apparel is defined as anything that is worn which enhances the performance of the user.

New and existing companies are attempting to break into the PA industry every day due to the rapid growth.

The top three companies in the global PA industry include Nike, Adidas, and Under Armour

Gross sales come from company owned stores and third party retailers.

Sell products of quality which enhance performance while providing comfort to the user.

Performance Apparel Industry Defined

2002 2006 2010 20140

1

2

3

4

5

6

7

8

2.83.3

6.4

7.6

Global Performance Apparel Sales ($ bil-lions)

Global Performance Apparel Sales ($ bil-lions)Linear (Global Per-formance Apparel Sales ($ billions))

18% Inc.

Market Analysis

• The Performance Apparel industry has grownrapidly in the past four years and it is expected to continue to grow rapidly the next four years.

52% Inc. 15% Inc.

Performance Apparel Growth Rates

15% 22%9%

4%

2%

7%

Trend Opportunity/Threat

Comment

Sales increase (15%+) Opportunity Will continue to grow

Quality over price Opportunity Consumers want value for their money

Increase in technological innovation

Opportunity Compression apparel is currently the big thing in PA

People becoming more physically active

Opportunity Market to entire market, not particular segments

Increase in cost of raw materials/resources

Threat Find ways to negate such costs

Eco-friendly design Opportunity More consumers will buy product and feel they are helping the environment

Fashion friendly Opportunity Consumers feel better when wearing something fashionable (esp. women)

New competitors entering market

Threat Create high barriers to entry and superior product

Moving towards all ages (older generation)

Opportunity Market to entire market, not particular segments

Key Trends in PA

Company

Corporate Social Responsibility

Mission Statement

Marketing Vision/Strategy

Under Armour

Innovation, Inspiration, Reliability, and Integrity

Make all athletes better through passion, science, and the relentless pursuit of innovation

-Athlete Endorsements-Commercials/Slogans (“Click clack” and “We must protect this house”)-Event and team sponsorships

Be the world’s #1 performance athletic brand

Nike Sustainability, Innovation, Quality

Bring inspiration and innovation to every athlete in the world.

-Brand Image-Brand promotion-Athlete and team sponsorships

Experience the emotions of winning and crushing the competition.

Adidas Sustainability, Innovation, Environmental Awareness

Strive to be the global leader in the sporting goods industry with sports brands built on a passion for sports and a sporting lifestyle

-Brand Image-Focus on international marketing-Athlete and team sponsorships

Enhance social and env. performance in the company and the supply chain, thereby improving the lives of the people making our products. 

Strategic Layout of Competition

Company Corporate Social Responsibility

Mission Statement

Marketing Vision/Strategy

Columbia Sportswear

Responsible business practices balancing economic goals with social and environmental considerations

Provide consumers the greatest quality outdoor gear while keeping them safe

-Increase on-line marketing -Stick to what we know and show consumers advantage of products

Continue to internationalize and provide high quality products to outdoor enthusiasts

Sugoi Innovation, Excellence, Value

Make excellent performance athletic wear for bikers and various other activities

_Increase global awareness of brand_Prove quality and uniqueness to consumers

Every garment that carries the Sugoi name is still designed, developed, and made in Vancouver, Canada

PUMA Sustainability, work towards a more eco-friendly world, global peace, Quality

Stay true to our values; inspire the passion and talent of our people working in sustainable, innovative ways, and do our best to be Fair, Honest, Positive, and Creative

-Sponsor international football and cricket players and teams-Increase presence in other markets

PUMAvision- create a safer, more peaceful, and more creative world than we know today

Strategic Layout of Competition

Company Corporate Social Responsibility

Mission Statement

Marketing Vision/Strategy

Quiksilver Touch people worldwide and improve quality of life, quality

Become the leading global youth apparel company

Focus is social media

Maintain our core focus and roots while bringing our lifestyle message of board riding, independence, creativity and innovation to this global community

North Face

Send famous athletes overseas and give back as much as they can; innovation; consumer-focused

Never stop exploring -Goal is to increase brand awareness-Social marketing

Our passion is beyond setting records and achieving fame, it's all about changing our lives and those people who inspire us to aim for extraordinary dreams

New Balance

New Balance Foundation; Make consumers value worth their money

Demonstrating responsible leadership, we build global brands that athletes are proud to wear, associates are proud to create and communities are proud to host

-Word of mouth-Athlete sponsorships

Continue to give back to all communities and provide excellent products to excellent consumers

Champion Ethical business practices, protect environment, quality

Anticipate what consumers want and innovate to meet those needs in comfort, fit, and value

-Social media-Athlete endorsements

world-class consumer goods company with a distinctive competence in operating a low-cost global supply chain

Strategic Layout of Competition

Social media has impacted the PA industry positively, increase in sales due to easier communication between consumers.

Consumers can give feedback (+ and -) in a relaxed environment.

Consumers can also socialize with other consumers to discuss PA products.

Marketing has been most effected by social media with sites such as Facebook, Twitter, Foursquare, and LinkedIn. ◦ PA companies can market to larger groups of

consumers at a much cheaper cost.

Social Media Importance

Nike and Adidas are Under Armour’s primary competition in the performance apparel industry.

Nike and Adidas have jumped UA in total PA sales even though PA accounts for only 7% of Nike’s and 9% of Adidas’s total turnover.

Under Armour would be the global leader in performance apparel sales if they were as successful internationally as they currently are in the U.S.

Asia and North America are fueling growth in the performance apparel industry with Europe also growing.

The performance apparel market is growing at a rate of higher than 15% and it is expected to continue to increase for the for seeable future.

Conclusions