How Will Your Favorite Sneaker Brand Perform in 2018? | Under Armour ($UA) ($UAA)

Originally posted on ARCH-USA

 

Under Armour $UA, $UAA

Current Share $14.75/$15.92

2017 Recap:  I was speaking with an analyst/writer for Benzinga and we were discussing Bitcoin and he asked me what I thought. I said I didn’t know enough, but if I had any money in pocket (which I don’t since I basically lost half a million a year ago) I would go all in on Under Armour especially since the share price dropped all the way down to 10.31 and 11.48 last month. He laughed and said I had to be kidding. I explained to him that Under Armour has a very simple fix and the most important thing they can do is to let the market know that they screwed up. They did that early in the year by axing the culprit of the brands problems Connected Fitness.

Under Armour Reports Third Quarter Results (NYSE:UAA) | UA is Humbled, But I’m Hopeful

The 3rd Quarter brought a challenge that UA has never seen, their first sales decline. The problem for UA was a long time coming and the brand took the time for reflection before the holiday season. Several top level execs moved on and the layoffs from earlier in the year shaped the rest of 2017. The brand had several bright spots however and in those moments lies my reasoning behind telling the writer from Benzinga that UA was a buy and would bounce back to the mid to high 20s by the Fall of 2018 if they played their cards right and actually created momentum internationally and if they capitalized on a revitalized design element in footwear with the Curry 4. I guess I need to state more clearly what those bright spots were:

The Curry 4 and Threadborne

Women’s Marketing

Opening multiple international stores

Doubling down on China

Even with the number of success stories during the year none of the moments appeared to be capitalized on and I’ve hinged my hopes for the growth I expect on the follow through of the moments in 2017.

2018 Analysis: IF, capital IF, UA actually takes the time to develop better marketing strategies they can find their way into the minds of the North American market. If they fail here at home those efforts will pay off internationally. Right now they’ve worked considerably on video marketing via YouTube, but the strategy is very flawed. It is good that after three years of declining marketing with video that the brand has taken a considerable step forward, but they have undercut that momentum by relying on influencers who are NOT loyal to the brand. The gains created from their new found marketing strategy will be short term and unfortunately the connection is not organic, it’s paid. I do realize that social media is no longer capable of going viral without paying to play, but they have in their wheelhouse a considerable amount of talent that is being considerably underutilized.

In short, I place a lot of value on UA’s potential growth and success on their marketing team because I feel that they’ve done a solid job of creating product. The problem isn’t in the product to me. It’s in remaining consistent in delivering content to the masses. The brand has one of the worst websites as it relates to driving engagement on their platform. Nike and adidas both have “news” sites/ blogs to enhance search and delivery of information. Jordan Brand has air.jordan.com and Nike uses Nike news and SNKRS. adidas has Gameplan A and adidas news. Under Armour is the only brand of the Big Three to not have any in house content creation to share their stories. They rely solely on social and while I know it works, it’s a long term mistake.

When you consider that Under Armour had two of the most powerful campaigns this year in the #Impretty and #UnlikeAny campaigns, add in on top of that they had Sloane Stephens win a grand slam and Under Armour was the most important brand in women’s sport this year. The result? Nothing. If you ask the average person about either of those hashtags they wouldn’t know a thing. Ask them about Sloane and nothing. Ask them about Jessie Graff completely destroying American Ninja Warrior and they wouldn’t have any idea she is an Under Armour athlete. UA’s marketing has missed so much it’s the only reason I have a hard time going all in on the brand.

Add to this the fact that UA has the best roster of boxers they could use a strategy that I labeled “NICHE OUT” when discussing what Under Armour should be promoting and spending money on. Under Armour has in its arsenal the top player in almost every sport, but when you go to their website you can’t even find the athletes they sponsor. There is no quick access to the stories of their athletes. The underdog (UA) acts like it’s the big dog and that’s a mistake.

2018 Prediction: Under Armour is already climbing back in the stock market. That has to do with the fact that the brand is making moves at the top and people are actually excited about the brand again with the design of it’s latest shoes. Add into that HOVR and you have the potential for Under Armour to shake up the sneaker world… but only if they take the time to build narratives. Right now the brand doesn’t have anything on their site building the narrative around HOVR. In a recent article I talked about my E.N.D.E.A.R.S© concept. UA is failing to create compelling stories around their products and they are failing to introduce them in a sequential manner that builds excitement. I think UA could have the type of break out year that adidas had last year… the problem is they don’t quite have a true grasp on the marketing they should be doing to reach that type of break out. I mean think about it. Christmas is always one of the biggest days in sneakers because of the annual NBA games. Both Nike and adidas dropped campaigns this year. Under Armour’s most famous player was injured and because the brand has failed to build the story of another athlete on their roster not a single website talked about UA. It’s this type of failure that could haunt UA throughout 2018 although they have almost everything it takes to kill it this year.

Chris on FacebookChris on GoogleChris on LinkedinChris on TwitterChris on Youtube
Chris
Chris
Founder, Writer and Webmaster at ARCH & CBP
Chris B. is the founder of ARCH.

The ARCH network is unlike other sneakerhead sites. ARCH is a more informative look into sneaker culture. By presenting information about the business of sportswear through marketing analysis, updates on stock prices and introductions to new brands and styles, the site is easily distinguished from the everyday site only giving you release dates.

You can follow me on Twitter or any of the links above.
  • Wow I just read the post , dude wa right when he said they needed to hire you now