A Comparative Analysis Of Nike And Under Armour

Mark Moulton

Professor Ottemann

December 10, 2014

2014 Term Paper

Nike & Under Armour Company Assessment

Nike and Under Armour are two of the largest sportswear and athletic shoe companies in the world. Their histories and growth are similar but they use different corporate and business strategies. Their strategies reflect their corporate structure and the personalities of their leadership. This compare and contrast paper will explore the history and development of these two corporate giants; conduct a strategic and financial analysis of each company; and compare and contrast the executive leadership, corporate strategy, acquisitions and divestments of each. The future direction of the companies over the next three to five

Plank was overwhelmed when Warner Brothers approached him in 1999 to outfit its actors in the movies “Any Given Sunday” and “The Replacements.” This was just the sort of advertising he needed for his young company to make its next jump. He realized the opportunity given to him and decided to leverage the exposure created by Any Given Sunday, by printing an add in ESPN the Magazine. This paid off tenfold as it generated a $750,000 increase in company sales, with this sales increase; Plank was able to finally place himself in the company payroll. Under Armour’s next big publicity jump happened in 2003 when the launched their first ever television commercial. This commercial publicized the phrase, “Protect this house,” which became the rallying cry for the company and revolutionize the performance apparel industry. The campaign was incredibly successful and with that Under Armour became a household name.

On November 18, 2005, Under Armour held its initial public offering. Stock went for $13 a share. At the end of the day, Under Armour became the first American based initial public offering to double on its first day of trading, in 5 years. About 12 million shares were sold allowing Under Armour to generate $157 Million. Under Armour continued its steady assent the following years and in 2010 accomplished an incredible milestone of $1 Billion in annual

Before entering an unknown product horizon, the company will investigate its viability in the product category as well as measure its competitive advantage to other companies in the niche. Under Armour’s unique ability to measure these two important factors has allowed it to create a product base which consumers have high loyalty towards.

The Under Armour brand has positioned itself in the high quality, high price, and best available in the market, category. It advertises itself as delivering higher customer value and is therefore capable of charging higher prices for their goods. With this Under Armour therefore is unable to use cost leadership as a means of attracting consumers but rather must turn to differentiation of product. Under Armour is able to differentiate itself from other apparel companies by the use of synthetic material in the production of its clothing and