SBD/Issue 31/Sponsorships, Advertising & Marketing

Under Armour Aims To Surpass Nike As Biggest Basketball Brand

Bucks G Brandon Jennings Will Endorse The
Launch Of Under Armour's Debut Micro G Line

Under Armour on Saturday launched its debut basketball shoe line, Micro G, in its efforts to "take on Nike," according to Matt Townsend of BLOOMBERG BUSINESSWEEK. Under Armour Chair & CEO Kevin Plank said, "Our goal for getting into basketball is to be number one. I’m 38. I’ve got a long time.” With its foray into basketball shoes, Under Armour "confronts not just Nike’s 95 percent market share and the billions it spends on marketing." SportsOneSource analyst Matt Powell indicated that "sales of basketball shoes in the U.S. have slid for the past three years as fewer people play the sport." Waddel & Reed Financial analyst Nathan Brown cautioned that "another failure in athletic shoes could hurt Under Armour’s long-term prospects." Brown: "If the basketball shoe doesn’t do well there will be questions because now you’ll have strike two and critics will say this company can’t ever be a footwear company." Plank contends that Under Armour has "learned from its previous missteps." He called the decision to promote the company's training shoe in an '08 Super Bowl ad three months before it hit stores "pretty cocky." Plank said that the release of the Micro G, endorsed by Bucks G Brandon Jennings, "will be a less splashy affair." Townsend noted there are "no big ad buys," and a "small number of pairs will land at national retailers" and urban stores. As Plank prepared for the shoe's launch, he "exhorted his employees to start thinking of Under Armour as a footwear brand not just an apparel maker." He told them to "cut the word 'apparel' from voicemail messages and trashed a mat in the company’s headquarters featuring the word." Plank added: "I called our marketing team and said go through this building and find anything that says we are only an apparel brand and throw it away" (BLOOMBERG BUSINESSWEEK, 10/22). Under Armour Senior VP/Footwear Gene McCarthy said that the company "will be taking things slowly in building a relationship with customers," noting that it is "next fall when Under Armour will move more confidently" (Portland OREGONIAN, 10/23).

ADDING POWER TO THE LINEUP: In this week's SPORTSBUSINESS JOURNAL, Terry Lefton reports Under Armour is "close to completing a deal that would gain it the rights to manufacture performance footwear with MLB logos and the ability to use its stable of baseball players in advertising wearing MLB uniforms." Sources indicated that "no apparel rights will be included in the deal, and that the first Under Armour MLB shoes are expected at retail by early next year." The company's MLB endorsers include Rays P Rafael Soriano, Nationals 3B Ryan Zimmerman and Baseball HOFer Cal Ripken Jr. (SPORTSBUSINESS JOURNAL, 10/25 issue).

Launch Of The LeBron 8 Marks Start Of
Important NBA Season For Nike

READY FOR TIP-OFF: In Portland, Allan Brettman reported Nike tomorrow night will "roll out its new LEBRON 8 shoe" as Heat F LeBron James "takes the court in his first regular season game" for his new franchise. The launch marks the "beginning of an important season for Nike, which dominates the basketball shoe market to a degree not often seen in clothing and apparel circles." Smaller companies are "on the horizon, hoping to carve market share away from Nike," and the Oregon-based company is "being forced to look increasingly overseas for new customers, mindful that the U.S. appetite for basketball shoes, apparel and equipment may not grow much more." SportsOneSource's Powell noted Nike in the past "has used James in commercials that established the Nike brand and did not necessarily sell a shoe or specific product." He said, "It will be interesting to see whether (Nike) pulls back on the branding things they've done with him. It will depend a lot on what happens on the court" (Portland OREGONIAN, 10/23). Meanwhile, Brettman reported adidas is banking on its new "Fast Don't Lie" campaign, "linked to the launch of the NBA season this week, to attract customers like never before -- and perhaps grow the company's low single-digit share of the U.S. basketball shoes market." adidas VP/Global Basketball Lawrence Norman said that the effort, featuring Magic C Dwight Howard and Bulls G Derrick Rose, "will be the single biggest ad campaign in the company's history" (Portland OREGONIAN, 10/23).

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