Under Armour’s Second Chance
The Daily Record
BALTIMORE (AP) — As Olympians packed their bags to leave Sochi, Under Armour was recovering from the U.S. speedskating team’s disappointing performance.
After the company’s new, high-tech suits were initially blamed for the skaters’ abysmal results, a shift to the team’s old uniforms failed to turn around the Olympians’ fortunes. Still, while that silenced some critics and softened the public relations bruising for Under Armour, the company’s marketing strategists had aspired to so much more — the image of American medalists standing on the podium with the company’s familiar logo on their chests for millions to see.
The Baltimore-born brand had little time to dwell on what happened on the ice. It’s already warming up for its next Olympic competition: gymnastics.
In February 2013, Under Armour signed an eight-year agreement with USA Gymnastics to outfit the national team through the 2020 Olympics. It was the biggest apparel deal yet for USA Gymnastics, and the first time Under Armour would sponsor a national governing body for the summer games. And not just any sport. Gymnastics is traditionally one of the show-stopping competitions of the Summer Olympics.
The U.S. team has been wearing the brand since then. It will embark on its “Road to Rio” this fall, following the P&G Gymnastics Championships.
Under Armour’s gymnastics journey has been a short one, beginning in 2011 when Alicia Sacramone signed with the brand and helped design a custom leotard. But in two short years that journey will hit the international stage.
For Under Armour, Rio is a second chance.
2013 was a big year for Under Armour’s gymnastics presence. It signed with USA Gymnastics in February, then the University of Maryland and University of Utah announced separately that their gymnasts would begin wearing Under Armour exclusively.
Both teams offered the opportunity for maximum exposure in the college gymnastics world. Maryland has made it to NCAA Regionals for six straight years, including the most recent season.
Utah Gymnastics has won nine NCAA championships and earned second place as recently as 2008. It made the “Super Six” in the gymnastics championship bracket for 13 straight years, the last time in 2012.
Both universities already had Under Armour contracts, and the gymnastics teams had been wearing the brand for everything other than leotards and warm-up suits. Maryland, the alma mater of Under Armour founder and CEO Kevin Plank, had even worked with the outfitter several times before to create special edition leotards.
“We’re not a mainstream sport, but they agreed to dabble with it a little bit,” said Maryland coach Brett Nelligan, whose wife happens to work for Under Armour, in digital sports testing. “I just had no doubt that Under Armour would be able to produce great leos.”
Utah coach Greg Marsden took a little more convincing.
“To be perfectly honest, I was reluctant in the beginning,” he said. “I had worked with another company for 25 years.”
The other company, Alpha Factor, had a much longer history in the gymnastics world. But Under Armour promised that its quality and service would be unmatched, and it offered to replace the school’s entire inventory.
Under Armour wasn’t totally alone, either, by the time Utah signed on. As a part of the USA deal, Under Armour partnered with GK Elite to manufacture leotards.
That expertise can be valuable. A reliable gymnastics leotard not only maximizes confidence and minimizes distraction, it can directly affect scores. Athletes can face point deductions for minor wardrobe malfunctions or for adjusting their uniforms during competition.
“GK has had a long, very positive image in the gymnastics community,” said Marsden. “What they gave Under Armour the ability to do is provide their customers instantly a high-quality product with imaginative designs.”
Along with GK, the gymnasts themselves can lend expertise to their new outfitter. Nelligan said that his athletes at Maryland have already provided feedback on the leotards.
That’s typical strategy for Under Armour, said Auburn Bell, vice president of corporate marketing at Legg Mason Inc., and affiliate marketing professor at Loyola University Maryland. He expects the company is doing the same with the elite gymnasts on the “Road to Rio.”
“It’s more than just the typical sponsorship of striking a deal to put their logo on the uniform,” he said. “They really focus more on getting in the trenches with the athletes and working with them to understand from the bottom up what their needs are.”
Officials with Under Armour and USA Gymnastics declined to be interviewed for this story.
While its college contracts have covered all kinds of sports, including the mainstream crowd pleasers like football, Under Armour’s Olympics approach has been more niche.
In addition to speedskating, the company outfitted bobsledding, skeleton and Canadian snowboarding in the Winter Olympics.
Gymnastics, while popular during the Olympics, yields lackluster ratings otherwise. The 2013 P&G Championships had about 2.7 million viewers, according to “TV by the Numbers.” But prime-time coverage of the 2012 Olympic gymnastics finals had 38.7 million, according to Nielsen.
Niche sports provide the opportunity to innovate without the threat of competition from larger rivals like Nike and Adidas, which have focused on different areas. Then, by the time the Olympics come around, said Bell, the product is refined for the global stage.
“What Under Armour can do with these more narrow and niche type of verticals, it gives them the opportunity on this big stage, with a lot less risk and potentially great reward,” said Bell.
Sometimes that doesn’t work out, as with speedskating, he said. But the impact at Sochi was mitigated by the specificity of the sport and the presence of other complicating factors.
And if the next Summer Olympics is anything like the last one, the gymnastics reward could far outweigh the risk.
“You’ve got these opportunities like the Olympics that sort of instantly give you, or a company, or a brand worldwide and global kind of recognition and promotion,” said Bell. “That’s an incredible opportunity for that company.”
(Copyright 2013 by The Associated Press. All Rights Reserved.)