In today’s market spectrum, Under Armour is considered part of a competitive market. A competitive market is a market with many sellers, selling similar products with free entry and exit. There are natural barriers that can make entry and exit for a company difficult, such as problems in raising capital and situations called economies of scale (Mateer 2016). These natural barriers can cause problems for companies trying to compete against the larger and more experienced companies such as Under Armour, Nike, and Adidas. Competition is what is driving Under Armour in the market. Its two biggest competitors are Nike, and Adidas. Nike was founded in 1964 (O’Reilly 2014), and has a net worth of 15.9 billion, and Adidas was founded in 1949 and has …show more content…
Under Armour has recently increased its number of ads, and sport stars. Sport stars such as Michael Phelps, Stephen Curry, and Misty Copeland have been huge advertisers for the company, which has helped in competing against Nike. In the collegiate world, Nike is the main sponsorship, but Under Armour has six division one schools, and twelve other colleges that it is currently sponsoring (Under Armour). This number is most likely to grow each year as the company is still in the earlier stages of developing. According to Fox Buisness reporter, Thomas Barrabi (Barrabi 2016), Under Armour recently partnered with UCLA and Cal Berkley by offering to pay $280 million in cash over 15 years. These contracts will help Under Armour’s market along the West Coast. USA today compares the companies, Nike and Under Armour in order to aid investors looking into the stock market. Under Armour has a higher growth rate than Nike, most likely because it is a newer company that is still expanding and taking advantage of new opportunities that are presented. Nike has a higher value when compared to Under Armour, simply due to the fact that Nike has been around for over fifty
Under Armour is not only focus on football product; it expanded segments to baseball, hunting, fishing, running, mountain sports, skiing, hockey, and golf.
Under Armour and Nike are very close competitors in the athletic wear for sports and recreational use. Both Under Armour and Nike have goods and bads but at the end of the day Under Armour is a better company, with a better clothes line. Nike came out over thirty years before Under Armour, but Under Armour has by far surpassed Nike in popularity and style. In another thirty years when Under Armour has been out as long as Nike today, Under Armour will be more superior than Nike in the athletic field. Nike will eventually be over ran by nike and will be a small company like Adidas
Nike is a major power structure in the global economy, a financial land marketing powerhouse. On every level, they practice diversity, they are socially responsible, and Nike gives back to those who are less fortunate. Nike seems to keep improving on every level of business there innovative and never seem to stop looking for new ideas to keep the consumer excited waiting to see what next. Financially Nike has come from nothing five hundred dollars and an idea. This is what America is made of entrepreneurial-minded individual, which believes in an idea and make it come true with just a few dollars.
As Nike is an international company that has their product selling worldwide, they have countless of competitors, including many domestic local firm. However, not all of these companies have the power to compete with Nike, only a few international companies are Nike¡¦s major competitors, for instance, Adidas and Reebok.
They could overtake Adidas if they continue with their innovative strategy because they’re only $3.5 billion away. Since now-a-days consumers are all about technology and new innovative products, if Under Armour continues with their innovative strategy they will continue to see an increase of financial growth, become a major competitor for Adidas, and a closer competitor to Nike.
Nike knows how the game is played they have been a large competitor in the market for a long time. Where as Under Armour began its business in the late 90’s, coming into the game with little resources under a significant goal to make. As the CEO and founder of Under Armour, Kevin Plank says, “Boy there’s a lot of talk out there.” He was talking about a large tweet that had been going around saying that Under Armour was going to sell to Nike. According to Daniel Roberts a reporter at Cable News Network (CNN) that the enormous $21-billion-in-sales Nike, was going to buy the $1.4 billion lower competitor Under Armour. Now just look at those numbers for a second and ask yourself, which company looks more successful. Nike has the potential to wipe Under Armour off the face of the market; Nike has also spread to a variety packed market.
Under Armour is a leading athletic clothing line directed towards the overall athlete who is looking for the most comfort during extracurricular activities. The mission of the company is, "to provide the world with technically advanced products engineered with exclusive fabric construction, supreme moisture management, and proven innovation. In short, every Under Armour product is doing something for you; it's making you better."
Under Amour Company ventured into a market segment that was overcrowded, it had thousands of companies that competed against each other. Out of the many companies involved in the trade, the two most formidable threats seemed to be orchestrated by Nike and Adidas. These are two giant sports apparel and footwear, which pride themselves as having been long term veterans in the industry. Nike in particular was christened as the ultimate shoe and athletic apparel company with revenues of $18.6 billion, net income of $1.9 billion and more than thirty two thousand employees globally in the year 2008. This makes it the largest athletic shoe and apparel seller in the world.
The sports apparel and accessories industry has a highly competitive market. Businesses are constantly competing for elite athletes to sponsor, raw materials, and every opportunity to expand. Under Armour is able to not only survive but thrive in this market because of their ability to think outside of the box. They are constantly creating new and exciting products that help athletes everywhere.
Nike’s goal is to remain unique and different from others in terms of the items offered on the market. Arguably, Nike belongs to a monopolistically competitive market as there only a few organizations with the ability to regulate the amount charged for their product which means they cannot make their prices high as this is likely to make customers move on to other available choices (Nike, Inc., 2012). However, Nike can find a balance between the prices to charge for their products and remaining competitive with other companies in the industry. Nike has formed a distinction between the appearance and performance of their footwear and that of their competitors. Although products are differentiated from other companies, they still influence each other because they are items of the same
Indeed, even with the lower evaluated substitutes from its principle rival, Adidas, the organization figures out how to make the most offers of its exceptionally estimated products(Esty, and Winston,2010). Its upper hand comes significantly from its tremendous advancement limit, high item quality, mark acknowledgment and in addition its solid chain of conveyance. In the year 2015, the organization recorded the most noteworthy number of patent rights in the US. Every one of these developments are gone for meeting the different client tastes and inclinations. Subsequently, even with the high value, the clients can purchase the quality related with them, as they trust that they get the estimation of their
Nike Inc. was founded in 1962 by Bill Bowerman and Phil Knight as a partnership under the name, Blue Ribbon Sports. Our modest goal then was to distribute low-cost, high-quality Japanese athletic shoes to American consumers in an attempt to break Germany's domination of the domestic industry. In 2000 Nike Inc. not only manufactured and distributed athletic shoes at every marketable price point to a global market, but over 40% of our sales came from athletic apparel, sports equipment, and subsidiary ventures. Nike maintains traditional and non-traditional distribution channels in more than 100 countries targeting its primary market regions: United States, Europe, Asia Pacific, and the Americas (not including the United States).
Nike American Sportswear generated revenue of 7495 million US dollars in 2014, which was almost double of 2009 revenue of Nike Sportswear (Statista, 2015).The sales of (Athletic) Sportswear of Nike 90 million US dollars, however, the sale of Adidas Sportswear (Competitor of Nike) was 25 million US dollars, which was not even one third of Nike Sportswear sales (Statista, 2015).Nonetheless, the return on assets and equity are 13.41% and 26.43% respectively (Yahoo Finanace, 2015).
Under Armour has always set aggressive targets for themselves and they should not change that now. The leadership team believes that “a 3% share of the (athletic footwear) market would nearly double UA’s total revenue” (Wheelen, Hunger, Hoffman, & Bamford, 2015, 2012, 2010), and this should be another one of the metrics that Under Armour monitors and grows.
Since its inception in 1949, adidas have been a leader in innovation; which is also their main competitive advantage in the market place. Along with innovation, the company differentiates itself in the market place with its strong brand equity, supported by a strong global marketing and advertising program.