Stephen Curry’s Talent Does Not Guarantee the Success of Under Armour
The main ambassador of the brand Stephen Curry and his team, the Golden State Warriors have won two of the last titles of the NBA, however Under Armor experiences loose sales.
The American company Under Armour, one of the leading manufacturers of sportswear in the world, reported last week a 5% drop in quarterly sales, compared to the previous year. The company also reduced its forecast for the rest of the year. CEO Kevin Plank said in a statement, issued to know these weak results that the biggest challenge facing the company is the fall in demand for footwear and sportswear in its local market, the United States.
The Baltimore-based company has been growing internationally, with sales increasing in Europe, Latin America and Asia during the quarter. But those markets are still relatively small for Under Armour. Revenue in North America accounts for more than three-quarters of its total sales, and those sales plummeted 12% in the third quarter. These data represent a major setback for Under Armour, which was recently gaining market share at the expense of Nike and Adidas.
The unusual case of Stephen Curry
The company signed the Golden State Warriors star, Stephen Curry, a few years ago, in a highly successful movement, since Curry has won multiple NBA MVP awards and two championships. Curry, who began his professional basketball career in a discreet manner, has been improving year after year to the point of breaking several records both individually and with his team. He reached the world title with USA in 2010, when at that time he was still the «son of» Dell Curry, a great long-distance shooter in the NBA, who ended up totally eclipsed by the success of his son Stephen.
However, Curry’s own character, as well as the type of footwear he has chosen (or chosen for him), have made the success of the brand that sponsors him much lower than the other geniuses in the basket. Kobe Bryant, LeBron James, and of course very far from the brutal impact of Michael Jordan, whose advertising successes were (and still are) extraordinary.
To make matters worse, there have been reports of problems in the supply chain with the new line of Curry4 sneakers. In addition, Under Armour (UA) confirmed last Tuesday during its conference call, which will delay some products until the fourth quarter. To change this negative direction, the company should focus on its global expansion, something that, until now, has been successful. On the other hand UA is not having too much success, at the moment, attracting the consumption of its feminine products. Precisely to attract more to its feminine public potential and to reinforce the perception of the brand by the world, UA has launched its campaign Unlike Any.
Under Armor presents Unlike Any
With the participation of rap stars and, the large American sports retail group launched Unlike dedicated to outstanding sports talent five ambassadors of the brand, apart from its great star Stephen Curry. Among these personalities are Jessy Graff actress and specialist, Chinese taekwondo champion Zhang Lanxin, as well as Alpine skiing world champion Lindsey Vonn, American Ballet Theater’s first dancer Misty Copeland and world champion sprinter Natasha Hastings.
The new campaign honors the achievements of athletes who managed to go beyond gender comparisons and achieve athletic excellence. Unlike Any, covers a series of global markets, including Russia, EE. UU, Europe and China, providing support to female athletes from all over the world.
The video series was filmed by Georgia Hudson of Agile Films counting for the lyrical part with the American rapper Saul Williams, as well as with the poet and political activist Christina Dominique and Taiwan rap singer Aristophanes (Pan Wei Zhu). «The goal of our brand is to inspire women around the world to make history their own life, this campaign is a reminder that we support women, that we are on their side.» said Adrien Lofton, senior vice president of management at Under Armor.
Severe drop in stock market
The company’s shares fell 15% after publishing the results for the third quarter and will lower its sales and earnings prospects for the rest of the year.The sportswear company earned USD 0.22 per share, as revenues fell 5% to USD 1,400 million. The market consensus expected 0.19 USD in revenue of USD 1.48 billion, according to market consensus. He also announced a restructuring charge of USD 89 million. Under Armor now sees adjusted earnings per share for the full year from $ 0.18 to $ 0.20, well below its previous forecast of $ 0.37 to $ 0.40.
Kevin Plank, in the statement of results. «Due to these problems in our larger market, we believe it is prudent to reduce our sales and earnings prospects for the rest of 2017.»Before last week results, Under Armor shares were down more than 43% during this year.The problems of Under Armor seem to have a solution, but the glory days, when double-digit sales increases would appear, seem to be over, for the time being. The Stephen Curry effect, seems to have stopped being shocking.