Under Armour Essay

3529 Words Jul 2nd, 2016 15 Pages
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Under Armour Enters the Basketball Shoe Market

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This case was written by Professors George E. Belch and Michael A. Belch. It is intended to be used as the basis for class discussion rather than to illustrate either effective or ineffective handling of a management situation.

The case was compiled from published sources.

Company Background

Under Armour (UA) was founded in 1996 by Kevin Plank, a former Maryland football player, who began by selling compression clothing that could “wick” sweat away from the body to
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The product placement and ESPN The Magazine ad led to a dramatic increase in website traffic and sales, and helped jump start the nascent company. A similar situation arose in 2003. This time it was sports cable giant ESPN who came calling, asking UA to be part of their new HBO series about football players called “Playmakers.” ESPN thought that since everyone in locker rooms seemed to be wearing Under Armour, it would be more realistic if the players in the movie were shown in UA clothing. At about this same time, the original “We Must Protect This House” commercial featuring “Big E” (Eric Ogbogu), an NFL football player, was released. The combination of the product placement in the series and the commercial again led to yet another major gain in sales. Perhaps even more importantly, the commercial immediately became immensely popular. Fans began holding up signs saying “We must protect this house” at college and NFL football games and the tagline would be shown on scoreboards during critical parts of games as a crowd prompt. David Letterman talked about the commercials on his late night television show, and mentions by Oprah Winfrey led to the line becoming part of the American lexicon. UA was off and running. In 2005 Under Armour went public and the stock nearly doubled the first day it was traded. Since becoming a public company, UA has had a compound annual growth rate of 33 percent, with sales reaching $856

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