Lakehead University COMM 200 Under Armour Case Analysis-verified by experts-GRADED A+

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Table of Contents Executive Summary......................................................................................................................2 Identification............................. ... ....................................................................................................3 Background.................................................................................................................................3 Strategies....................................................................................................................................3 Objective and Goals....................................................................................................................3 Problem Statement......................................................................................................................4 Internal Analysis...........................................................................................................................4 SWOT Analysis..........................................................................................................................4 Financial Analysis.......................................................................................................................5 Value Chain Analysis..................................................................................................................6 External Analysis..........................................................................................................................7 Industry Overview......................................................................................................................7 Competition Analysis..................................................................................................................8 Perceptual Map...........................................................................................................................9 Five Forces Analysis...................................................................................................................9 PESTEL Analysis......................................................................................................................11 Consumer Analysis...................................................................................................................11 Key Success Factors and Uncertainties.....................................................................................12 Analysis of Alternative Solutions...............................................................................................12 Decision Matrix...........................................................................................................................14 Recommendations.......................................................................................................................15 Action Plan..................................................................................................................................16 Contingency.................................................................................................................................16 Appendix.....................................................................................................................................17 Exhibit 1: Strategic Fit Test......................................................................................................17 Exhibit 2: Financial Analysis – Stock Performance..................................................................17 Exhibit 3: Financial Analysis – Profitability Ratios..................................................................19 Exhibit 4: Compound Annual Growth Rate 2010 to 2013........................................................20 Exhibit 5: Value Chain Analysis...............................................................................................21 Exhibit 6: Segment Chart..........................................................................................................22Executive Summary This report was undertaken to provide Under Armour executives with an analysis of the company’s overall situation and to recommend a set of actions to improve the company’s future prospects. Under Armour has a financial objective to increase sales by 71% from 2013 to 2016. Under Armour’s strategic plan must change to address achievement of the key success factors of the industry which are continued technological advancement and innovation, quality and performance in product and services, product variety and to continue growing brand awareness and image. The methods of analysis used in the report include a summary of past and present strategies used by Under Armour including a strategic fit test which demonstrates that Under Armour has crafted a winning strategy which provides the company a good basis for its changing business plan and strategy. An internal analysis including a SWOT assessment, financial analysis and value chain analysis is performed to determine Under Armours strengths to build upon as well as isolating areas for improvement. The internal analysis emphasizes Under Armour’s strength in product innovation and successes in sales and achieving market share within North America. The internal analysis exposes Under Armour’s limited global presence and highlighted opportunities outside of North America. The external analysis provides an industry overview, competition analysis (including a perceptual map displaying Under Armour’s position in the market), five forces, PESTEL and consumer analysis. The external analysis displays areas within the market for Under Armour to grow where they are clearly behind industry leaders Nike and Adidas from a global perspective. Under Armour has room to grow in market segments outside of athletes and in product development by adding or expanding other athletic apparel lines such as footwear. The complete analysis and evaluation of 5 various alternatives leads to a recommendation that Under Armour has the financial resources to undertake the creation of Under Armour Concept Shops in addition to expanding product range and research and development. Both of the alternatives chosen address the industry’s key success factors as well as working well in 1 | P a g econjunction with one another in providing the new products developed an Under Armour brand store to highlight them. Identification Background Under Armour was originally founded as KP sports in 1996 by Kevin Plank, a former United States college football player with the mission “to make all athletes better through passion, design, and the relentless pursuit of innovation”. Under Armour is the originator of performance athletic apparel made from innovative, lightweight, synthetic materials designed to keep athletes cool and dry. Strategies Under Armour started out using a focused differentiation strategy, as they entered the market focusing primarily on male athletes and using innovative technology to create apparel designed to wick away perspiration, regulate body temperature and improve comfort. The popularity of these products rapidly grew and the company went from selling directly to individual athletes to athletic teams primarily at the collegiate level. Currently, Under Armour has progressed towards a board differentiation strategy with the offering of a widening product line and ongoing innovative technological advances. As the company continues to grow, they find themselves competing against sportswear giants such as Nike and Adidas. A key element that has allowed the company to compete against such rivals that are bigger in size, more established and with more capital is innovation. The company continues to focus on producing items that are superior to traditional products. As the company climbs to the top they recognize a need to expand their marketing efforts, in particular the use of sponsorships and endorsements with star athletes. Under Armour also saw an opportunity to expand globally and secure a leadership position in the global market. After conducting three tests to evaluate the merits of UA’s strategy, the results show that the company has overall crafted a strong winning strategy providing the company an exceptional backbone for their business plan. UA has grown at an impressive pace since the start and is well positioned to continue to grow in the global market based on their solid strategies and ability to adapt to their internal and external conditions (See Exhibit 1). 2 | P a g eObjective and Goals Under Armour’s financial objective is to generate $4 billion sales revenue by 2016, which is a 71% increase from the 2013 sales level. Kevin Plank will need to re-evaluate the current strategy and develop a new one that will strengthen their organization while weakening competitors. Problem Statement Under Armour’s performance has been favourable since its inception, however, there is huge potential for growth. The company’s strategic plan must change to address their need to deliver more value to its customers and generate better business results. With revamping their strategic plan; the company may potentially be risking more than near-term disruption that will affect the company’s long-term viability. Internal Analysis An internal analysis is performed on Under Armour to identify and evaluate its competency, cost position and competitive viability in its marketplace. SWOT Analysis The SWOT Analysis provides a useful framework for analyzing UA’s strengths and weakness, as well as its external opportunities and threats. Strengths:  Strong brand name and company image – able to build a reputable and authentic brand in a short period of time. [Show More]

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