Under Armour Swot Analysis

Benchmark

While Nike, the leader in the sporting industry, had a revenue of $24 billion in 2012, Under Armour achieved revenues of $1.8 billion in 2012. 58% of Nike sales come from out of the US, compared to only 5.9% of UA sales. Nike has around 20,000 retail accounts in the US, and more than 20,000 retail accounts in foreign countries. UA owns about 25.000 retail stores around the world, mostly in North America. They have the opportunity to earn higher sales by expanding their business more in foreign countries. It would also provide them with the recognition they need for their brand image. Nike spent $2.71 billion for advertising and endorsements in 2012. Their marketing strategy included endorsement contracts for over 1,000 famous athletes

Their investments in research and development exceeded those of Adidas, and aided their growth in the market. However, its distribution networking is not as effective, and they have very low patent protection. Nike and Adidas manufacture a broader array of products for their customers than does UA. Furthermore, although UA has a high brand loyalty, their reputation is still not approaching those of Nike and Adidas, which are brands recognizable almost everywhere. As shown in the competitive strength analysis table in Appendix E, Nike has the highest overall strength, 8.10, Adidas in the middle with 7.70, and UA the least with a score of 7.10. Thus, there are high implications that UA can exceed Adidas and Nike’s market share in the future. UA is at net competitive disadvantage against both rivals. It has to develop strategies that could eliminate the barriers that are affecting its performance. Some offense strategies include constructing a successful distributing network that could reach the utmost consumers worldwide, increasing marketing budget for more brand awareness, and increasing its product line. Its low patents rights require a defensive strategy. The company should try to take the rights for its technology in order to protect its assets and gain competitive advantage in the

They also face a high competitive capabilities of sport companies as it is an active market with many sellers and buyers.

Key success factors in the sport industry include technological, manufacturing, distribution, and marketing factors. For this reason, UA chould use these factors to adopt strategies that eliminate industry threats. UA should increase their geographical coverage and brand image to increase their market presence. They should also develop their supply chain management along with their marketing plans. The following defines the strategic issue along with the recommendation that UA should act on to improve their overall company:

Strategic Issue

The strategic issue faced is “How can Under Armour expand