Any active person is well aware of the name Under Armour. It is synonymous with big global companies like Nike, Adidas, and Puma. Started by Kevin Plank in his grandmother’s basement in 1996 (Barrabi, 2020), it is now one of the biggest names in sports athleisure wear in the United States. The company offers high quality apparel for men woman and children and a variety of costs to fit anyone’s budget. Under Armour also offers footwear and accessories for sports. Consumers have a variety of ways to shop for Under Armour products including Under Armour stores, through partnerships with major retailers such as Kohls and others, and online through the Under Armour App or their website.
Under Armour is a very profitable company constantly showing a gross profit between 1.9 billion to 2.4 billion between the years 2015 – 2019. (mergentonline.com) Below is a graph from Statista.com that shows the gross profit of Under Armour.
These are very strong earnings for a company that was started in a basement and have been consistent for 5 years.
A SWOT analysis of a company will show the company’s strengths, weaknesses, opportunities, and threats when trying to determine if they should launch a new product and where. In the case of Under Armour it would make sense to launch a new product because of the company’s strengths. Number one being because of the increase in cash reserves. Having more cash on hand means that the company can utilize its own assets to fund research and marketing for new products rather than borrowing money and increase the company’s short-term debt. Another strength is that Under Armour already has a broad product portfolio, so the company has a great amount of experience when it comes to entering new markets. Finally, Under Armours multi-channel approach will make all of the company’s products available to consumers through multiple outlets for increased visibility and increased convenience for the consumer.
What I am proposing is that Under Armour enter the nutritional supplement market. Some products can include but are not limited to protein powders, BCAA’s, multivitamins, creatine, weight loss supplements, and creatine. Though this is not a new category or product, it will be unique to Under Armour because it will be backed by the company’s reputation and they can even place it under the Project Rock Line, which is endorsed by Dwayne “The Rock” Johnson. In 2019 the revenue for vitamins and supplements in the United States was 32 billion dollars. (Statista.com) If Under Armour creates its own line of supplements with The Rock, it can use its brand and the Rock’s name to build instant credibility amongst consumers. Couple that with the multi-channel approach that the company already has in place, this should be a no brainer.
The supplement industry is a 32-billion-dollar industry in the Unites States, and now Under Armour can have a piece of that as well. Looking at the financials and investors page at underarmour.com, you can see that 67% of Under Armour’s revenue comes from the Unites States.
With room to grow globally as well and having The Rock behind its supplement line it would be a profitable advantage for Under Armout to add a line of quality nutritional supplements.
References:
https://about.underarmour.com/investor-relations/annualreport2021
Barrabi, Thomas, 2020, How Under Armour was Foundedhttps://www.foxbusiness.com/retail/how-under-armour-was-founded
Kostas Site 