General Environment Facing Under Armour Marketing Essay

General Environment Facing chthonic come across erupt Marketing EssayTarget in men, women and youth. ( to a lower place armours diverse w are task for men, women, and youth is complex, but the message is simple wear HeatGear when its hot, ColdGear when its cold, and AllSeasonGear between the extremes.) pagan differences. (Product transcends cultural differences and it is appealing to many athletes, regardless of nationality below fit is puisuing a adult malewide scope via regionalization.)EconomicIncrease economic condition by improving the gross sales balance and reducing the seasonal worker variability in sales, inventory efforts and distribution.Economic risk. (The degree of economic risk associated with the premium determine and low fit is feeling the effects of the current declining retail consumer food marketplace that is affecting the broader economy.)Current economic downturn challenges chthonic armor to contend against major rivals.Political/ LegalThe tele phoner full treatment with multiple licensees now by and throughout the harvest-festival development process to tick that the products atomic number 18 reorient with its brand and quality expectations. on a lower floor armor does not endure a patent on any of the materials use in its products. Therefore, it needs to be cautious in its licensing agreements so companies do not steal its know-how and bestowuce their own versions. chthonic fit signed a five- year confederation agreement in April 2009 with Cal Ripken, Jr.The intellectual quality rights laws and regulations of countries in the international market vary dramatically.Sociocultural low fit out missions is to enhance the make got for all athletes by reserveing passion, skill, and the relentless pursuit of innovation to create robes with temperature control, comfort, and flexibility. chthonic Armour has reached weak athletes, active outdoor enthusiasts, elite tactical professionals, and active lifestyle consumers.Planks shirt truly did regulate athletes body temperatures, im theatrical role to improved performance. downstairs Armour had five lines of clothing do for every climate. footwear product line visualizeed for high performance through a highly breath equal to(p) and lightweight design.Global low Armour is able to successfully penetrate the sports app bel market by apply the go out and influence of domestic and international professional teams, collegiate teams, Olympians, and individuals. under Armours products are sold worldwide, with the fraternitys headquarters located in the join States and support pipices in Hong Kong and Guangzhou, China.Under Armour sells products in 13 countries, including in-house distribution in the unite Kingdom, Germany, and France. Sales in an separate(prenominal) Western European and Asian countries are done through partnerships and third-party distributors.Under Armour do not turn over to contend with the challenges associated wit h establishing manufacturing plants in foreign countries.engineeringPlank created a man-made shirt made of high-tech material that had a snug fit designed to feel like a second skin.Products are offered through the companion website.For the first ten long time of its existence, the company was able to entertain trading operations by using off the shelf software programs.Under Armour invested in a raw(a) SAP system. This system is a key to the companys ability to extend products to list of offerings, as it allows Under Armour to manage a much diverse inventory and to ship at one time to distributors.Physical EnvironmentWhen Plank was a football game player he grew tired of having to change his damp, rotund t-shirt down the stairs his jersey, so he set out to create a unique product that would fancy the needs of all athletes.Though the materials and technology employ to create its products are not exclusive, by implementing an effective corporate strategy Under Armour ha s been able to fashion itself as a profi circuit card business and last out a key player among competitors.Use Porters Five Forces Model to kittyvass the set, footwear, and equipment sedulousness in the US. Given this analytic thinking, is the industry attractive or subfusc?Porters Five Forces ModelMedium threat to new entryUnder Armour operates in a highly competitive industry where the prevalent competitors have significant breadth of market coverage that is difficult to father an entry point. The main competitors have been publicise and establishing distribution channels, marketing agreements, and designation for many years.High threats of substitute productsUnder Armours major competitors are Nike and Adidas with comparable or competing product offerings.Under Armour does not have a patent on any of the materials employ in its products.High effectiveness of rivalry among competitorsThere is stiff competition in the athletic robes industry with companies of various sizes employing different strategies in install to attract consumers to their product and brand. The outstandingr companies continuously increase competition by spending peachy amounts of money on product innovations, advertising, and sponsorship.High bargaining power of suppliersUnder Armours customers is willing to pay the price for its products because their products have value in it. somewhat of it suppliers are commodities and thus are subject to price fluctuations for example, petroleum-based materials are used in Under Armous products and the petroleum industry has experienced significant swings in price and relative availability in recent months and years.Under Armour relies heavily on suppliers and manufacturers outside of the United States. Seventy to 75 per centum of the textile used in its products comes from only six suppliers, lending to Under Armours weak position relative to its suppliers.Low bargaining power of buyersUnder Armour has developed unique products that consumers value.The customer is willing to pay the price because the Under Armour product has value in it.Who are Under Armours main competitors? How do they measure up against these competitors? Classify the competition under the 3 Is framework agile competition, be competition, invisible competition.Competitor analysisCompetitorsNike.Adidas combined with Reebok.Columbia Sportwear.SportHill.Immediate competitionThe immediate competitor is Nike. Nike is the leader in athletic shoes and captured half of the athletic shoe market. Footwear is new product line that was launched by Under Armour in fourth quarter of 2006. Under Armour is likely to introduce other athletic shoe like basketball shoe in future. It is a challenge of Under Armour to drive into athletic shoe market because Nike has already captured most of the market share in footwear.Another immediate competitor is Adidas. Adidas, who is the second largest athletic dress up manufacturer in the world by and by mergi ng with Reebok. The apparel is major revenue of Under Armour. In year 2007, the apparel dominated 84% total sales of Under Armour. Reebok second largest manufactured in athletic apparel manufactured, so the union between Adidas and Reebok become the immediate competitors for Under Armour.Impending competitionThe impending competitor of Under Armour is SportHill. SportHill utilizes the expertise of elite athletes to perfect its design and innovative new products. It is well known for quality, comfort and reliability. Their clothing can be found globally in most major retailer stores and can be purchased online. Therefore SportHill poses a threat to Under Armour. covert competitionThe invisible competitor of Under Armour is its suppliers. The intellectual place rights in technology, fabrics and processes used to manufacturer Under Armour products are principally owned by their suppliers and not unique to Under Armour.The lack of patented product rights, intellectual property right s in foreign countries, and a heavy reliance on comparatively few third-party suppliers and manufacturers could adversely affect the commodious-term sustainability of the profligate. comport a SWOT analysis to bring in Under Armours strengths and weaknesses. employ the table below, conduct a SWOT analysis identifying the firms strengths, weaknesses, opportunities and threats in the table below.SWOT AnalysisStrengthsEmployees work as one team. Plank manages his company with a unique team-driven style. Under Armour is one team and my frolic is to help ensure we operate and actualize as one team. whole leadership. Planks drive to keep trying even during difficult times when it seemed the company might never flourish is what made it possible. He knows every construction of it because at one time he actually did the work himself.Under Armour sells products in 13 countries, including in-house distribution in the United Kingdom, Germany, and France.Under Armours accessories categor y is developed and managed directly by Under Armour.Under Armour possesses an efficient operations and distribution network. SAP system has the ability to annex products to its list of offerings, as it allows Under Armour to manage a more than diverse inventory and to ship directly to distributors.WeaknessesLow level diversification. 84% of its revenue comes from athletic apparel and gear.Highly dependent upon premium priced products that are closely related.OpportunitiesUtilizing broad-based, frequently free endorsements and well-received publicity, Under Armour has also reached regular athletes, active outdoor enthusiasts, elite tactical professionals, and active lifestyle consumers. triumph was initially slow in coming, but once Plank made his first big sale to Georgia Tech University, Under Armour grew rapidly.During 2007, Under Armour increased its marketing initiatives by opening self-owned retail and outlet stores.By leveraging its licensing partners (JR286, Inc. and USG), Under Armour can earmark a wider range of brand products to its customers.Under Armour signed a five-year partnership agreement in April 2009 with Cal Ripken, Jr., a retired professional baseball game player, to be their official uniform representative. Under Armour feels this is a great probability because Ripken previously was partnered with Nike.ThreatsThe main competitors have been advertising and establishing distribution channels, marketing agreements, and cite for many years.There is stiff competition in the athletic apparel industry with companies of various sizes employing different strategies in order to attract consumers to their product and brand. The larger companies continuously increase competition by spending large amounts of money on product innovations, advertising, and sponsorship.Under Armour faces several issues and challenges. These challenges entangle the current economic downturn, competing against major rivals such as Nike and Adidas/Reebok, and mainta ining a affirmatory brand image despite setbacks, such as the recent back out of its mens protective athletic gear.The lack of proprietary product rights, intellectual property rights in foreign countries.A heavy reliance on relatively few third-party suppliers and manufacturers. Under Armour relies heavily on suppliers and manufacturers outside of the United States. 75% of the fabric used in its products comes from only six suppliers.Conduct a Value mountain chain analysis to identify value-creating activities.Value Chain AnalysisFirm infrastructureThe companys operations from Planks grandmothers basement moved out into a manufacturing warehouse in Maryland.Human resource managementHaving been part of a sports team, Plank manages his company with a unique team-driven style. Under Armour is one team and my job is to help ensure we operate and execute as one team.Many of his first employees were his college classmates and teammates. Most of them are stillness with Under Armour and play important roles in management.In order to facilitate its international expansion, Under Armour hired several new executives with experience in international business, most notably Peter Mahrer.Technology developmentAt the end of Under Armour first year of operations, Under Armour had five lines of clothing made for every climate, and the companys operations were moved out of Planks grandmothers basement into a manufacturing warehouse in Maryland. after(prenominal) Under Armour went public in 2006, Under Armour invested in a new SAP system. This system is the key to the companys ability to add products to its list of offerings, as it allows Under Armour to manage a more diverse inventory and to ship directly to distributors.ProcurementUnder Armour relies heavily on suppliers and manufacturers outside of the United States. 75% of the fabric used in its products comes from only six suppliers.Inbound logisticsFor the first ten years of its existence, the company was able to sustai n operations by using off the shelf software programs.OperationsUnder Armour licenses its brand found to independent manufacturers for other miscellaneous products such as bags, socks, headwear, eyewear and watches. The company works with multiple licenses directly throughout the product development process to ensure that the products are aligned with its brand and quality expectations.Outbound logisticsAfter Under Armour went public in 2006, Under Armour invested in a new SAP system. This system is a key to the companys ability to add products to its list of offerings, as it allows Under Armour to manage a more diverse inventory and to ship directly to distributors.Products are offered through the company website and retailers, and the company stores in the United States, Europe, Japan, Canada, southern Africa, Australia and New Zealand.Marketing and salesProducts are offered through the company website and retailers, and company stores in the United States, Europe, Japan, Canada , South Africa, Australia and New Zealand.ServiceWhen customers would request products that Plank had not created, he would respond, Of running we make that and then immediately go to work with suppliers and contractors to deliver on his promise.What is Under Armours business-level strategy? Is the strategy appropriate to offset the forces in the industry? Conduct an analysis of Under Armours business strategy by using the 4 Ps Framework. The 4 Ps Framework is used to understand a companys strategy based on itsPosition (Mission, Values, and Vision)Priorities (what is important to the firm in the dead and long terms)Payments (what it will spend its money on to reach those priorities)Performance (how it will measure success)PositionThe task at hand was to simply make a superior T-shirt and nobody more.Under Armours mission is to enhance the experience for all athletes by applying passion, science and the relentless pursuit of innovation to create clothing with temperature control, comfort and flexibility.Under Armours stated goal is to be a leading developer, marketer, and distributor of branded performance products.Ever since its inception in 1996, Under Armours leaders have strived to achieve the companys vision of becoming the worlds leading performance athletic apparel brand by employing a differentiation strategy through innovation.PrioritiesFor misfortunate term, there appears to be a trend that sales are higher(prenominal) in the third and fourth quarters of each year, aligning with the football and basketball seasons and the traditional holiday gift-giving season in the United States.For long term, Under Armour has been able to quickly earn loyalty after a customer has had one or two good experiences with their purchase.PaymentsFor short term, Under Armour has contemplated putting more emphasis on its baseball product line to improve the sales balance and reduce the seasonal variability in sales, inventory efforts and distribution.For long term, they have the technology in the fabric and the design and the features satisfy what the athlete needs. Their model is getting to the athletes-supplying them with great product that helps them perform better.PerformanceThis is further evidenced by a 133 percent compound annual growth rate and an equally immense increase in operating income from $5.7 million to $52.5 million between the years 2003 and 2007. As of 2007, Under Armour had $606 million in sales revenue, far-off surpassing its first years revenue in 1996 of $17 thousand.Do you recommend any changes to its strategy and/or foresee any challenges? dependableness on suppliers. Under Armour relies heavily on few third-party suppliers and manufacturers. Under Armour should try to find more suppliers for their fabric. Even if the price of fabric rises or suppliers stop supplying the company, Under Armour still has other suppliers to carry on its business.Strategies for competition. There is a stiff competition in the athletic appar el industry. Under Armour should do more advertising to bring awareness to people about the companys brand. This way, Under Armour could have more competitive advantages in the market.Lack of patents. Under Armour should apply for patents for its products innovations to prevent other competitors from duplicating its products.