We Must Protect This House! - Under Armour Bursts Onto the Scene Thanks to Founder Kevin Plank

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Thirteen years ago, Kevin A. Plank, a senior at the University of Maryland and a player on the school’s varsity football team, came up with a simple idea for a better, more comfortable football undershirt that would wick away moisture from one’s body rather than absorb it. This idea was sparked from Plank’s dislike for the cotton T-shirts he had always worn under his football pads. He was annoyed at the way they would always become drenched with sweat or rain after he played in them and then he hated how the shirts would proceed to stick uncomfortably to his skin. The opportunistic Plank took note of how cycling outfits, skiers’ clothing, and even football undershorts at the time were made from special synthetic, moisture-wicking fabrics. He figured that this same clothing material could be used to engineer revolutionary skin-hugging T-shirts that were lighter than regular cotton undershirts and could be sported comfortably underneath one’s football pads: “The idea was to create a T-shirt that wouldn't hold moisture--more important, that wouldn't hold the moisture's weight.” 4

This simple plan to “build a better football undershirt”1 became the blueprint to Mr. Plank’s grassroots business venture. One day, Plank grabbed a pair of his shorts containing the moisture-wicking material, tore off the content label, bought the same material from a local fabric store, and paid a tailor over $400 to sew several shirts for him. He then had some of his teammates try out the new shirts. They fell in love with the shirts, and soon Plank found himself commuting to New York’s garment district, where he had hundreds of the new moisture-wicking shirts made. Immediately after his graduation from Maryland in 1996, Plank, determined to convert his idea for these athletic undershirts into a viable product that customers would buy, furiously set to work designing the shirts in the basement of his grandmother’s townhouse in Washington, DC—and Under Armour was officially born. Over a decade later, Plank’s hard work has paid off as Under Armour Inc. has become a leading competitor in the athletic performance apparel industry. With an annual average growth of nearly 250 percent, Under Armour actually holds a market share of over 70 percent.

In 1996 as a senior football player at UMD, the idea I had was for alighter, better tee-shirt than the one that was offered. So, the option was to go out and create a better tee-shirt and that is how Under Armour got started. It started with one shirt for football for warm weather and evolved into all weather gear for any activity.3

Kevin Plank’s innovativeness, hardworking nature, and determination were all on full display early on in Under Armour’s start up phase as he desperately worked to put his product on the map. After acquiring the sleek, moisture-wicking material, Plank set to work, tirelessly developing his athletic shirts. His initial marketing strategy early on was to pitch his product to several of his friends and former teammates from Fork Union Military Academy, where Plank spent one year after high school, as well as those he knew from the University of Maryland who had made it to the National Football League. He would then take this a step further and market his shirts to college football teams and then to NFL teams. Plank was spending tons of his own money to fund his business venture, and early on things were not looking up for him. He recounts this in an Inc.com article:

I probably had about 20 grand in the bank when Under Armour started. A lot of money for a college kid. I ended up going to just under $40,000 in credit card debt spread across five cards. In the summer of 1997, I was totally broke--so broke I needed to go to my mom's house to ask if she minded cooking dinner for me. I needed for her to feed me. Then all of a sudden I started getting my first round of orders… 4

Mr. Plank devoted tremendous time and effort into marketing his shirts, and after a couple years, it all seemed to finally begin paying dividends for him. Slowly the offers began to trickle in. Then they began pouring in. Plank made his first major sale to the Georgia Tech football team. Slowly, and seemingly out of nowhere, Under Armour began to become a hit. College football programs, like Arizona State University, and NFL teams like the Atlanta Falcons, showed tremendous interest in Plank’s athletic shirts—The Atlanta Falcons actually wore his undershirts during Super Bowl XXXIII in 1999. 5 In 1998, NFL Europe signed Under Armour to be its official supplier of athletic performance apparel to its teams. Eventually a number of famous professional athletes became Under Armour fans, which did wonders for Kevin in terms of advertising and marketing. Football stars like Jerry Rice, Jeff George, and Plank’s college teammate Frank Wycheck began regularly sporting his revolutionary athletic shirts: “We convinced these big tough football players to start wearing tight-fitting synthetic shirts, which was completely new and different.” 1 In addition to these players, big names in other sports, including all-pro baseball pitcher Roger Clemens, and slugger Barry Bonds fell in love with Under Armour as well. In fact, Bonds wore Under Armour during the entire 2001 MLB season, the season he became the new homerun king. This free form of advertisement brought Under Armour legitimacy and an authenticity that regular advertising never could. Young athletes all over the country and even across the globe who always looked up to these sports stars would now see that Under Armour logo on them.The ESPN series, Playmakers, gave Under Armour a lot of exposure by having the characters—professional football players on a fictional team—wear all Under Armour gear. The movie Any Given Sunday did the same. 6 The message that Plank was trying to get across was that Under Armour enhances performance—if important athletes were wearing Under Armour and were getting the most out of it then it must really help anyone perform at a higher level: “We don't pay athletes millions to wear our brand. We don't have to. Our model is getting to the athletes--supplying them with great product that helps them perform better.” 4

Mr. Plank encountered stern competition in the athletic clothing market as most entrepreneurs do when entering an established market. However, Plank truly believed Under Armour had a huge advantage over its competitors, even the sporting apparel giant Nike, because its products performed the best. He felt that the professional athletes that wore Under Armour did so because they felt it gave them an edge over the competition:

They wear it because theybelieve. They believe it gives them an edge,it makes them just a little bit better, and gives them anedge, it makes them just a little bit better, and gives them that performance that they're looking for on thefield...Thesetype of unpaid endorsements, though, they don't occur because people like us, they don't occur because we're lucky, they occur because of product, great, great product, and it's not who writes the biggest check, but who has the most compelling product story. We believe this is part of our focus on performance. For Under Armour great product is all about performance.2

Ever the innovator, Plank expanded Under Armour by developing new products and entering into new markets. From moisture-wicking undershirts, Plank has introduced ColdGear apparel for the winter, HeatGear apparel for the summer, AllSeasonGear, athletic apparel for all sports ranging from basketball to golf, women’s sports apparel, children’s sports apparel, and recently, Under Armour entered the athletic shoe market, releasing moisture-wicking football and baseball cleats. Under Armour has grown tremendously over the years, and is still growing today. National retailers like Dick’s Sporting Goods, one of Under Armour’s biggest retail partners, now carry Plank’s products and sell them to consumers all over the U.S. Part of the reason for this growth can be attributed to Plank’s overall marketing strategy, which allows him to compete with the corporate giant that is Nike, which came up with its own line of moisture-wicking athletic clothing. In addition to the endorsements from famous athletes, Plank utilizes catchy slogans and simplistic marketing messages that resonate with the consumer:

As I said, we are a product company first and foremost…one of the best products that we manufacture as a company is our story, the way we communicate a very complex message of technology and simplify it for the consumer for them to understand, and there's a couple of ways that we do that. One of those simplified net marketing messages is the way we talk to the consumer through our media. It's concepts and campaigns like our 'Protect This House' campaign, which is something that's built much more equity beyond the 30 seconds we could afford to buy on television, but is now echoed across playing fields across the country. It's things like our new 'Click-Clack' campaign, which is our introduction into cleated footwear. It's the sound that an athlete makes when they step on concrete with their cleats before they step onto the field. It's the way that we resonant with the consumer, and I think the results speak through our performance. 2

This type of advertisement, along with player endorsements and superior product development has helped Plank steal customers away from Nike and has proven to the corporate world that scrappy underdogs can compete with the big dogs.

In 1996, Under Armour had one employee and grossed $17,000. Today, Under Armour, now based in Baltimore, MD, has about 1000 employees and made over $600 million in revenue in 2007 with a net income of about $52.6 million. Under Armour now has licensing deals with Major League Baseball and the National Hockey League estimated at about $10 million. The company also supplies athletic apparel to many college football teams and almost every NFL team. In November 2005, Under Armour raised $112 million in its initial public offering. In fact, this was the most successful IPO by an American company in 5 years. While Under Armour has had tremendous success, Kevin Plank still remains ambitious and continues looking for ways to further grow his company into even more of a powerhouse in the sports apparel industry. He is in the process of going global with Under Armour, introducing the company’s products in Europe, Asia, and other places overseas. Plank has always been an opportunist and a great salesman. He talks about how as a kid he was always looking for ways to make money and how his first real business was bootlegging T-shirts. Overall, Plank attributes his success to three things: “people, product and drive.” 3

My overall impression of Mr. Plank, who is a graduate of my high school, St. John's College High School in Washington, DC, is that he was not necessarily the smartest guy, but he was smart enough to recognize an opportunity and determined enough to make the most of it in order to reach his entrepreneurial goals. He was an extremely hard worker who remained focus in the face of adversity. Plank organized his goals and assumed risk in order to reach them. He proves that if you have a heart, the will, and the determination you can succeed in anything you put your mind to. In the entrepreneurial respect, Plank identified his niche market, developed a unique, new product that appealed to the people in that market, and then utilized a superior marketing strategy to endorse his product.