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SBJ/February 28 - March 6, 2005/Forty Under 40
Published February 28, 2005
KEVIN PLANK, UNDER ARMOUR
BY TERRY LEFTON
Everyone in the $37 billion sports apparel industry knows what is best for Under Armour. Every industry veteran knows the performance apparel company should get out now — before they are outwitted by the sharp minds at Nike. Fold their tent, before an established competitor like Russell Athletic crushes them with superior manufacturing and distribution. Sell out now and move to the beach, before Reebok leverages its athletic shoe muscle to squeeze in more competitive apparel product.
|• Age: 32|
|• Titles: President and founder|
|• Company: Under Armour|
|• Education: B.A., business, University of Maryland, 1996|
|• Family: Wife, D.J.; son, James, 19 months|
|• Career: Founded company at 24|
|• Last vacation: Vail, Colo.|
|• Last book read: "Pour Your Heart into It: How Starbucks Built a Company One Cup at a Time" by Howard Schultz|
|• Last movie seen: "The Aviator"|
|• Greatest achievement: Marriage, my son and winning the city championship in high school football. The ball from that game is my most prized possession.|
|• Greatest disappointment: We had our first women's line ready to go in 2001 and ended up killing most of it because it was disappointing. Torching $700,000 worth of product wasn't an easy decision, but it was the right one.|
|• Business advice: Know what you're good at and what you're not good at. That's where a lot of business mistakes are made.|
The truth is, while every sports apparel company is now making performance athletic underwear, even with 300 or so products and more than $200 million in sales forecast for 2005, Plank is in the business of brand building. Regardless of the relative merits of Nike’s Dri-Fit or Reebok’s NFL Equipment performance line, neither company will ever have a brand name more suited to a product than Under Armour.
Like so many stories of business success, the brand name’s derivation was an accident. Plank, who played football at the University of Maryland, had already told his family his company was going to be called “Body Armour,” but it turned out that there were already bulletproof vests and body shops with that brand. When Plank’s brother snidely asked how “Under Armour” was doing, the name stuck — and it cleared trademark registration.
As the company is attacked on all sides by competitors, the biggest question now is how elastic the Under Armour brand is. The answer will determine if it’s a one-trick pony, or whether it will continue as one of the most sought-after names in the me-too, markdown-plagued world of sporting goods retail.
“We have the opportunity to be one of the great brands in this business,” said Plank, who began his business on savings and credit card loans in his grandmother’s basement. “The good news is that with our track record, if we see a new category, retailers will give us an opportunity.”
Plank counts Starbucks Chairman Howard Schultz as an inspiration, and the similarities are striking: Both companies grew based on a superior product and without massive marketing budgets.
“You don’t try to out-Nike Nike,” Plank says.
Under Armour’s longevity will depend on whether the company can apply the same kind of marketing savvy to other product lines.
“The best thing we make is our story — the way we communicate with our consumers,” Plank said. “Technical fabric [like the kind used in the compression shorts that were the inspiration for Under Armour’s original T-shirts] was around a long time before us. We just figured out a compelling way to explain it to consumers.”