After taking the company public, in 2005, Kevin Plank started to spend more in marketing and endorsements. Since Under Armour (UA) has been created in 1996 and traded publicly in 2005, Kevin Plank and UA have used the underdog mentality as the driving force for its endosement strategy.
Since its first endorsement deal in 2004 with Eric Ogbogu, a football teammate of UA founder, Kevin Plank, at the university of Maryland, UA was increasing its athletes’ endorsements as the brand has become more and more profitable. Tom Brady, one of the greatest quarterbacks of all time; Michael Phelps, the most decorated Olympian; or Lindsey Vonn, the most successful American skier in history, are some of the big names.
"We pick the athlete with a chip on their shoulder and their desire to win because it aligns with our own attitude.” said A. Lofton, UA's marketinge executive, to Fast Company
She added that the brand considers itself an "underdog brand". One of the major examples is Stephen Curry. Back in 2014, Curry was an overlooked in the NBA draft. However, UA was willing to take the risk to sign a deal with him. The brand bet on the underdog, and hit the jackpot as Curry is now one of the best players in NBA. The year after, UA’s footwear sales have been boosted by 40% according to Fortune, driven by strong demand for its basketball shoes endorsed by Curry.
However, UA did not only want Curry to be its brand ambassador to boost sales, but also to use endorsement to go global. Curry helped UA a lot to penetrate the Chinese market as basketball is the most popular sport in China and represents a valuable market with 500 million fans according to Bloomberg. That is why UA have decided to feature Stephen Curry for its annual Asia Tour to increase brand awareness among Chinese consumers and to have roots in China. In the same way, as UA is not really famous in France, the brand signed contracts with famous French athletes such as with Teddy Riner, the French 10 times World Champion of judo.
Moreover, UA’s growth strategy includes college endorsement contracts like its biggest rivals, Nike with the University of Oregon or Adidas with the University of Kansas. Maryland University is the state of UA. The brand has deep connections with the university’s football and basketball teams and became, only eight years after UA was born, the official outfitter of University of Maryland athletics. This partnership enables UA to test new products on campus and use athletes as part of its research-and-design process.
However, UA endorses not only current/former sport celebrities, but also nonathletic personalities and women to expand its target market.
The “I will what I want” 2014 marketing campaign, featuring the well-known model, Gisèle Bundchen, aimed to encourage all non-professional women athletes to never give up. UA’s strategy is also to build brand equity among women because the brand has long been known for portraying the “tough guy” in its ads. This campaign was a success as it increased by 28% the women’s sales, by 42% the traffic to its website, and surpassed Adidas by becoming the No.2 in the U.S. sportswear market. (The Washington Post) This marketing campaign targeting women also aims to compete with the brand Lululemon with its athleisure line for women.
Finally, it is not possible to talk about UA’s endorsement with not mentioning Dwayne Johnson, known as “The Rock”, as this endorsement has been ranked as the best-matched celebrity partnership by Spotted’s study in 2018. Following this endorsement, a co-branded apparel, accessories and signature shoes, called Project Rock, have been created. The collaboration has been a huge success as the first shoe line, Project Rock 1 sneaker, has been sold out in less than 24 hours the same year.
Thanks to its effective endorsement strategy, UA is now able to compete with the Big Names to win endorsement deals. In 2014, Nike and UA were competing to sign a deal with the NBA Star Kevin Durant. UA offered between $265 million and $285 million over 10 years (ESPN.com), but Nike outbid the offer.
Nonetheless, all these deals are very costly for UA and can become useless if the company enjoys fewer valuable benefits than expected. That is why, in June 2020, the brand has decided to cancel its 15-year sponsorship deal with UCLA, the largest sponsorship in college sports history worth $280 million and signed in 2016.
“Under Armour has recently made the difficult decision to discontinue our partnership with UCLA, as we have been paying for marketing benefits that we have not received for an extended time period”
The above statement is the termination’s reason that the company said to The Los Angeles Times.
In a nutshell, UA’s endorsement strategy of signing deals with celebrities, first in football, then in all sports, colleges, women and nonathletes professionals creates brand awareness, an emotional relationship with customers and sales. It also gives legitimacy among customer bases and has helped to turn Under Armour into Nike’s strongest competitor. However, UA still has a long way to go before scaring Nike that spent 10 billion USD in 2016 in celebrity endorsements.
References:
· Falquy, I. (2017, February 20). L’incroyable course d’Under Armour pour détrôner Nike un jour. Les Echos Start.https://start.lesechos.fr/societe/culture-tendances/lincroyable-course-dunder-armour-pour-detroner-nike-un-jour-1177158
· Meghan R. Murray. (2016, July 16). Under Armour’s viral campaign for the female market proved a winning strategy. The Washington Post. https://www.washingtonpost.com/gdpr-consent/?next_url=https%3a%2f%2fwww.washingtonpost.com%2fbusiness%2funder-armours-viral-campaign-for-the-female-market-proved-a-winning-strategy%2f2016%2f07%2f15%2f73c50602-42fd-11e6-88d0-6adee48be8bc_story.html
· Schlabach, M. (2020, August 27). UCLA sues Under Armour for terminating $280 million sponsorship deal with school. ESPN. https://www.espn.com/college-sports/story/_/id/29749328/ucla-sues-armour-terminating-280-million-sponsorship-deal-school
· Handley, L. (2018, August 3). Under Armour’s collaboration with Dwayne Johnson tops list of the best-matched celebrity endorsements. CNBC. https://www.cnbc.com/2018/08/03/under-armour-and-dwayne-johnson-top-celebrity-endorsements-list.html
· Rovell, D. (2014, August 20). Ball in Nike's court for Kevin Durant. https://www.espn.com/nba/story/_/id/11384303/kevin-durant-offered-massive-deal-armour-nike-right-match
· Unknown author. (2019, October 19). China’s 500 Million NBA Fans Face Loyalty Test. Bloomberg. https://www.bloomberg.com/news/articles/2019-10-09/china-s-500-million-nba-fans-face-loyalty-test-in-standoff
· Hockstein, K. (2019, January 2). Case Study: Under Armour’s “I Will What I Want”. Collage Group. https://www.collagegroup.com/2016/04/21/case-study-under-armour/
· Sykes, M. D. (2017, August 29). Kevin Durant says ‘No one wants to play in Under Armours’ while standing up for Nike. SBNation.Com. https://www.sbnation.com/2017/8/29/16220684/kevin-durant-nike-under-armour-maryland-bill-simmons
· Reuters. (2016, July 26). Steph Curry's Shoes Are Driving an Under Armour Revenue Surge. https://fortune.com/2016/07/26/stephen-curry-under-armour-shoes/
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