Under Armour Case Analysis

Under Armour Case Analysis

Karen M. Flener

Strategy and Competition, BUSN-6200, S1, Section OD

January 25, 2015

Abstract

Billions of dollars are spent annually in the sporting goods and healthy living industries today.  One of the top competitors is Under Armour.  This case analysis will allow us insight into the birth of a new company with an unconventional product in addition to including a situation analysis, assumptions and missing information, problem definition, development of alternatives and evaluation of alternatives and recommendations to management.  Additionally a SWOT analysis will give us understanding the companies’ strengths, weaknesses, opportunities and threats; if the company has a sustainable competitive advantage (if so, why and how); and the companies’ evolution and current strategy.  We will also include a value chain analysis which will identify value creating activities.  All combined we can garner a look at one of the most successful companies in the sports industry from its humble beginnings to where it is today.  

Under Armour

     Under Armour, at its infancy, was the product of a single thought of a University football player who, after practices and games, his and his team mates cotton T-shirts were covered with sweat and thought there has to be a better way.  Founder and CEO of Under Armour, Kevin Plank, set out on a mission after graduation from the University of Maryland.  He wanted to develop a T-shirt that would stay light even in the harshest weather conditions.  To do so he went through New York’s fabric district to find materials that would solve the problem and work to meet his goal.  After making his first proto-type he shared his new product with former team mates and others who had since taken their careers into the NFL.  He received their feedback, completed revisions and developed his final product, just one product.  A T-shirt that wicked moisture away from the body, was light, comfortable and kept athletes cool and dry without weighing them down.  With his product, now developed as he had envisioned, he took his next step to start up his company, in his grandmothers’ basement.  For startup capital, he maxed out all of his credit cards.  His first sale was 12 months later and the momentum of his companies’ success has not stopped.  Less than 20 years later, Under Armour is one of the worlds’ leading innovators in the performance apparel and accessories industry.

     One of Under Armour’s competitors is Nike and their slogan is “Just Do It”.  Similarly, Under Armour focuses on the “I Will”.  Their Wills include:  “I will act like a global citizen, I will think like an entrepreneur, and I will create like an innovator.  They also have what they call their 4 pillars of greatness:  make a great product, tell a great story, provide great service and build a great team (http://www.underarmour.jobs/our-mission.asp).     The company has since grown to a multi-billion dollar global firm.  Please see attachment one for a copy of a portion of the press release dated January, 2014 regarding the company’s performance in 2013 (copied from Under Armours’ website, (http://www.underarmour.jobs/downloads/UA_News_2014_1_30_Earnings.pdf).