Successful ventures are often the result of innovation and having the ability to see opportunity in change. The sports apparel industry was basically a sector that provided basic wear for athletes and sports enthusiasts. Creativity, style and innovation were not the concern of manufacturers. It was only in the late 1990s that an entrepreneurial individual put into action his vision of providing not just the same, old kind of shirts, but something that is sporty and highly comfortable — the ideal wear for a sportsman. A Pioneer Is Born
In 1996, Kevin Plank, a former football player for the University of Maryland, began a small-time operation called Under Armour whose primary goal was to create superior shirts for athletes. He envisioned a shirt that would be cool during hot seasons, and provide warmth on cold seasons. These apparels came to be called: HeatGear, ColdGear, and AllSeasonGear. The technology involved in creating the shirts includes using a Lycra blend to provide heat and warmth depending on the season. By regulating heat, athletes no longer find themselves soaked in sweat during days of hard training.
What started as a basement operation in Baltimore turned into a multi-billion business, and gave birth to the performance apparel sector. The company currently holds at least seventy-five percent of the industry. It has about fourteen thousand stores globally, with offices in Canada, Hong Kong, Amsterdam, among others. Aside from shirts, Under Armour now sells cleats, boxer shorts, battling gloves, and sports bras. Almost a decade after its conception, Under Armour sold shares to the public in an initial public offering where stock prices rose to over $26 a piece.
Marketing, Production & Growth The company’s growth is partly attributed to its modest marketing campaigns, which rely on cost-effectiveness and innovation rather than celebrity endorsements. Almost all of Under Armour’s products are manufactured overseas in countries where labor costs are lower, such as Mexico and China. These strategies enable Under Armour to save millions of dollars. To sustain its growth, Under Armour looks into new markets to penetrate. The company’s focus is currently on men’s apparel, which gives it the opportunity to explore women’s sports apparel.
The company also believes in expanding into other markets in other countries to protect it from the effects of an unstable U. S. economy. Industry experts suggested that Under Armour, having no patent on its moisture-wicking technology, should innovate and launch more retail stores to provide their products with more exposure. Going Forward Studies made for the clothing industry revealed that in the performance apparel industry, only three percent of the growth accounts for shoes. Once more, Under Armour sees this as an opportunity for expansion.
Responding to this, Under Armour disclosed that in May 2008, it will launch a full advertising campaign for its cross-trainer shoes, in a bid to revive interest in this dwindling business. This latest project, however, will use up about thirteen percent of its 2007 revenue, raising investors’ concern of overspending on marketing. For more than ten years, Under Armour has proven itself capable of taking risks and succeeding. There are doubts regarding its latest venture and time would tell whether the company could weather another hurdle and prove that its business sense remains as good as before.