Case Study Under Armour

Topics: Sport, Revenue, Sports equipment Pages: 6 (1816 words) Published: June 8, 2015
Case #5 Under Armour- Challenging Nike In Sports Apparel
Shuying, Sai
1 Industry & Market:
Under Armour was founded in 1996. The founder is Kevin Plank, a former football player who played for University of Maryland. At first, it started with a simple idea that making sports T-shirt more comfortable when players wear it. After 15 years, Under Armour became a big company who already spread their market into different country. In sporting goods market, Nike and Adidas are the two industry-leaders. Now Under Armour compared quite favorably with Nike and Adidas. 2 External Environment:

·there is a trend for more and more people to pay attention to the healthier lifestyle and most of customers start to focus on doing exercises during daily life.(Culture) ·the customer group already spread to different aged, genders, nations. Those customers have different kinds of demands on the sports products. (Culture) ·female customer’s number is increasing. They have more demand on the sports goods. Color, style, fitness and so on. (Culture) ·the global market on sport goods is booming. For under armour, the business is still focus on domestically, its international business is still not as well as Nike, Adidas. Industry leaders, like Nike, Adidas or reebok, they build up many factories in developing counties, which promote the development of their countries’ sports goods, brands. China is an example. Now there are many brands appear in Chinese sports goods market. (International economic: market share- international) ·customer always like high performance (best-cost) goods. (Consumer psychology) ·Under Armour build its company in a developed market, but it has its featured products. (Economic: market share) ·once there is a salable good appear, other companies will try to manufacture similar product to compete with it. (Technology) 3 Internal Environment:

·Under Armour has a good brand image in his customers. Rely on its featured sportswear, under armour has already establish its reputation in those customers. (Brand power) ·as a younger brand, Under Armour is narrow to spread its market share. (Market share-domestically) ·since sports goods is a mature market, Under Armour has little possibility to be beaten by new entrants. (New rivals) ·easy to be replaced. Since there are so many different brands of sports goods, it is easy for under armour to be replaced by other brands. For example, if a customer cannot find the shoes he wants in under armour’s store, he will turn to other brands store for shoes with similar style or function. ·the supplier power is low.

·the pressure from leading brands, like Nike, Adidas, will influence the development and spread of under armour. 4 Financial Analyses:
·based on the Selected Financial Data for Under Armour, the net income in 2008 has a slide reduce, but after that, the net income is increasing. So is it when we see the net income per common share. It shows that the stock performance is not so good in 2008 like other years. ·before UA change its name, in 2000, the operating income is 0.7 million. In 2005, this income become 32.7 million. ·company’s average growth rate is 25%.

·The company stock was trading in the $72 to $78 range in January 2012. Following the announcement of better-than-expected first quarter 2012 earnings and management forecasts of full-year 2012 revenues of $1.78 to $1.80 billion, Under Armour's stock climbed to $102.70 per share in the last week of April 2012. 5 Economic Condition for Industry:

Thanks to the increasing global demand of sport products, the UA’s market share and the sales growth is increasing. The modern technology and product’s design let the sports companies’ condition better than several years before. The competing between different companies are intensely than before. 6 Key Trending Factors:

Lifestyle & Fashion (customer’s demand)
Technology on manufacture (product’s design)
New marketing (new market or new customer group)
7 swot Analysis:...
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