The mission of Under Armour is to ensure that they are able to provide the world with products that are advanced technically, whose engineering is enhanced through superior construction of the fabric, fashionable management of the moisture and innovation that is proven (Under Armour, 2007).
The under Armour products are aimed at providing catering to men, women as well as young athletes of all levels, size and shape. The products offered are limited to three major apparel lines that are consistent of HotGear for competition during the hot weather, ColdGear for cold weather together with AllSeasonGear which are specially designed to adapt to both weather. Limited athletic footwear are also offered including the football cleats. Recently, Under Armour has been on a mission geared towards creation of other footwear types specifically for other sporting activities. With the new line of product in place, there is hope that Under Armour will be able to compete at all the levels and aspects.
In the market of sports apparel has been characterized with competition which has over has been dominant in this retail industry for more than 20 years (Mercurio, 2009). The major competitors in this industry are inclusive of Adidas, Columbia Sportswear and Nike. These companies have been listed in many records as the strongest competitors to Under Armour. The foundation of Nike is dated back to 1972 whereas Adidas foundation dates back to 1924. It is obvious that the period that these competitors have been in business is long together with the market experience by far exceeds that of Under Armour in the industry, based on its foundation which is in 1996 (Under Armour, 2007.
There is in addition a striking similarity in the type of products that are carried by each company. In all these companies, they manufacture shirts that are “moisture- wicking”, various clothing for athletic use together with athletic shoe lines. In addition, the pricing is very similar; factors that have resulted in a very strong rivalry in the sports apparel companies. The intensification of this rivalry has been commensurate with the increase in the competitor number. There is a similarity in all these companies which are all in the apparel industry making Under Armour to operate in an industry characterized with intensive competition.
The Under Armour competitive advantage is enhanced by the company’s strong will for innovativeness through which it is able to come up with new products ahead of the competitors. This does not mean that these competitors do not make effort to catch up, but however, by the time they try to catch up, the company comes up with another innovative idea through which it is able to stay ahead in the market. For instance, initially, Under Armour has been involved in designing a fabric through use of a combination of elastane and polyester through which the moisture would be kept out of the body. The initial outcome was market domination depicting a competitive advantage. However, this technology was countered by Nike introduction of Dri-FIT technology. This competition was maintained a stiff level and in the process acted as a barrier to the new small companies entrants into the market, therefore creating a territory where the market can be dominated by only a few industrial giants.
Therefore, as noted above, the innovation enhances Under Armour to grow ahead of the competitors. Whereas the large competitors have a high recognition in the market, the selling of their products is mainly based on the name of the company. However, entering of Under Armour into this competitive is not very strongly attributed to its name but to the products performance and quality. Through incorporation of the existing skills of the company as well as the know-how on technology, they have the opportunity of entering new lines of the product.
Target market and product strategy
Under Armour target market is inclusive of the children, youths and adults that are physically fit. The new strategy is driving the company into exploring new markets in which it can be able to sell its products. With the ambition of succeeding on the soccer front in Western Europe, Under Armour is considering targeting Asia and South America in marketing its soccer cleat. Whereas it factual that the competitor Adidas holds the European soccer market, there is a representation of a growing market in South America and Asia, a market that is targeted by Under Armour based on the fact that there is no strong preference in the products from America. Therefore, the new target market that is spelling another dawn for Under Armour is the soccer clubs.
Under Armour has developed many products which enhance its ability to differentiate from the competitors. Through the incorporation of the LockerTag technology that was created by Plank (the initiator of Under Armour), one of the product categories of the company’s products is developed. This is aimed at offering a solution to the athlete apparel problem of getting a mix up in the locker room. In addition, other products that are created by Under Armour are; Cold Gear, Heat Gear together with All Season Gear. These categories are designed to ensure that the consumers are kept cold during the warm weather, warm during the cold weather as well as maintaining their comfort during all the weather types. In each of the gear line, a choice is also provided between three types of fit; lose, fit and compression. Through specializing on a specific line of products therefore enhancing expertise, Under Armour has been able to maintain a competitive advantage over the competitors. The company clearly knows the market that it is targeting and goes ahead to design the specific products that will maximize satisfaction to these consumers.
In order to be able to explore the areas in the world that have not been tapped, a company has to explore ways through which the distribution logistics can be improved (Thompson et al., 2007). Majority of the Under Armour products are packaged and distributed through two facilities of distribution that are located in Maryland, Glen Burnie. The high bay facility is the first distribution facility that was built in 2000. The second high bay facility was manufactured in 2003 in which 200,000 square feet is occupied by the company. Through these distribution facilities, the company is able to meet its needs in the short run. The products of Under Armour are in addition distributed in Europe through a provider of third party logistics that is based in Tilburg.
In order to facilitate the production and retailing of the products, a retailer’s physical facility is usually very essential. Under Armour have an office in Hong Kong which not only acts as the retail outlet bot also supports the efforts of sourcing, manufacturing together with quality assurance. In addition, the China office is used for the purpose of providing support to quality assurance in the effort to develop the high quality footwear products. The Maryland distribution facility is readily available to the customers who have specific needs. In this retail shop, there is a stock of various fabrics and various colors which in addition assists in building and shipment of the products that are on strict deadlines. Through these stores, a competitive advantage is enhanced to the company through ensuring it has the ability to provide a specialized service to the customers.
The promotion and marketing at the global level is triggered when a strategy is adopted that enhances selling of the company products to athletes that register high performance together with the professional and collegiate level teams. This strategy is implemented through sponsorships, agreement with the athletes at the individual level together with direct sale of the products to the managers of teams and athletes. This results to Under Armour uniform, socks, gloves together with other apparel items being seen in the field therefore making the product an exposure to various audiences who are potential customers through magazines, television and other events of live sports. With this exposure, an authenticity is established in the field based on the fact that these products can be seen by the consumers as they are being worn by athletes’ renown for high level of performance.
When it comes to promotion and media, the company’s men and women are featured in various publications such as magazines together with advertisement being carried on regular basis in various publications that are sport specific and in outdoors.
The pull strategy is used by Under Armour implying that there is pulling down of the product demand from the bottom down. There is no need for much assistance to the customers in their product purchase. This is based on the assumption that for example by the time a consumers looks for Head Gear, they have knowledge on its use. No assistance will be required in making the decision to purchase. Typical of the Under Armour strategy of pull, a good advertising amount is usually used in product promotion.
In order to ensure that they are able to maintain a steady competition with the major giants in the market, Under Armour realizes the need for investing in marketing campaigns that are more confident and competitive. Some of the applied strategies are inclusive of release of the fashion line of product in which their performance materials are featured together with the market attraction to the youths. Other strategies that have been incorporated have been making collaborative commercials with refreshing drinks together with the invitation of the celebrity appearance in the advertisements which enhances creation of an association with the customers. The marketing and sales on the basis of business to business has been the focus and in order to ensure that a larger market is gained, the drive has been towards tailoring the customer. Through the incorporation of TV commercials, a national recognition of the brand it usually enhanced.
Competitive advantage in promotion
Under Armour has been able to incorporate the modern means of promotion which has been through its website. This has given the company a competitive advantage through their ability to influence their customers in unique way in which the modern technology is utilized. This form of promotion has enhanced the company to create a center where there can be an interactive media in which the items can be purchased online. It is possible for any item to be bought which is simply enhanced through going and navigating into the website of the company. Through this approach, the customers are not only able to learn about and purchase the products of the company but also are provided with the customer service whereby various issues can be solved in relation to the available products. In addition, this website is a cheap media whereby the company connects and informs the potential customers about the new offers, the new products and advantages among other information.
Pricing strategy and tactics
Various issues are usually considered in the pricing strategy. The strategy is aimed at revenue maximization in the long run. Setting of price is done with a careful consideration of the competitors and for Under Armour, the price is mainly been maintained at the mid-range. Nike, being a more experienced competitor in the market has adopted the lower range pricing strategy through which its prices are relatively cheap in comparison to those of Under Armour and Columbia Sportswear which is also another major competitor. There is however maintenance of a price differentiation between the competitors’ products and in most cases, there are times when the prices are usually at the highest levels between the two competitors (Under Armour and Columbia Sportswear).
In the process of determining the price of a product, the price adaptation by the customer is usually considered by the company because through this approach, there is enhancement of developing long term customers as well as success in the referral program (NetMBA, 2008). For competitive pricing establishment, cumulative quantity discount is adopted together with special discounts on shipment to encourage the customers into placing orders for more purchases. Price adaptation has also enabled Under Armour to become successful in the business growth based on the number of customers together with the profitability.
The process of integration for Under Armour began being non- existent based on the fact that the Plank (the founder) has pondered the company’s idea. To enhance implementation of the adopted system, the company has in the past had to integrate the employees with other firms to ensure that its projects are finished in a manner that is timely. Through the incorporation of the technology, it has been possible for the company to form integration with the sales, finance, distribution and production associates. With the company’s direction being headed for the future, there is a possibility of even more integration in the company. As the expansion spreads to other countries, exploration is done on how distribution logistics can be enhanced in these areas.
Through the incorporation of the competitive advantage as well as the competency, Under Armour has a high potential of emerging as a leader in this market. This competitive advantage can be enhanced in design, manufacturing and development of apparel that are characterized with high quality.