Business of Sport: Under Armour gets the Hollywood treatment

  • Facebook
  • Twitter
  • G+
  • Mail
  • Pinterest
  • LinkedIn
  • Facebook
  • Twitter
  • G+
  • WhatsApp
  • Pinterest
  • LinkedIn
Under Armour are now the second most popular sportswear brand in the US.

What started in a basement has morphed into an $11 billion monster which now has the United Arab Emirates firmly in its gaze.

Nike and adidas may have dominated the sportswear landscape for decades but Under Armour are growing at an incredible rate, making some incredible waves in the process and their backstory is quite something.

Founder and CEO Kevin Plank used to traipse up and down the East coast of America with a car full of stock and hopes. And it wasn’t until a meeting with an Oscar winning director and actor that his dreams started to become a glorious, and lucrative, reality.

Fast forward to today though and his brainchild is now, incredibly, the second most popular brand in the US. Their stable boasts some of the most exciting athletes on the planet.

You only have to listen to Plank, 42, for a matter of moments to discover the kind of drive, belief and attitude which persuaded the likes of Tom Brady, Andy Murray, Jordan Spieth and NBA superstar Stephen Curry to share his vision. The Welsh rugby team and the EPL’s Tottenham Hotspur are also on board.

The Welsh Rugby Team have a unique partnership with Under Armour that will last until the end of the 2018 season.

And it was thanks to the unlikely combination of Oliver Stone and Jamie Foxx that the company stands so tall right now.

With a store in Abu Dhabi’s Yas Mall already opened and one in Dubai soon to follow, Under Armour are making their move in the “untapped” Middle Eastern sporting market. Yet, as the company continues to gain ground on market leader Nike, it seems only right to trace all the way back to 1996 and the start of this all-American success story.

With the realization a career in the NFL was not on the cards, Plank, a decent player in his University of Maryland days, turned his hand to what his football playing friends needed – shirts which stayed dry under all that heavy padding.

While they boast an impressive selection of trainers and general sportswear, it was Under Armour’s compression vests worn underneath traditional athletic shirts which set them apart. Murray, for one, is a huge fan.

“I never really liked the way my cotton t-shirt felt,” Plank told Sport360º at a glitzy Manhattan launch of Curry’s signature basketball shoe, which was superbly and hilariously compered by friend and associate Foxx.

“So I had this idea for a shirt – why doesn’t anyone make a better alternative than going from short sleeve cotton in the summer to long sleeve in the winter?

“I went to a fabrics store where I bought some material that I thought would fit the idea – synthetic in nature so it wouldn’t hold moisture. No-one had done anything like that at that time. There was a couple of things – like synthetic moisture management but no-one had ever complied compression to it.

“The company was born. My grandmother had passed away a few years before. There was this old house in Georgetown, Washington DC and I set up shop there. I was living on the third floor, my sales office was in the dining room. My inventory was in the basement.

“Everyday I wouldn’t know what would happen but I certainly never believed that it wouldn’t happen.”

Plank’s belief is infectious but everyone needs a break. His came, quite uniquely, thanks to the 1999 film ‘Any Given Sunday’ starring Al Pacino, Foxx, directed by cinematic legend Stone and involved him hurriedly stitching the Under Armour insignia into a jock-strap.

“Maybe other companies have Oscar winning actors to help promote their brand but Jamie isn’t someone who we just hired. He has a very strong relationship with our brand. Do others have that?” he asked.

“A friend of mine was the starting quarterback for the 49ers and they were playing in Washington. A friend of his said ‘oh I have just been cut but I have managed to land a role in this Oliver Stone movie about football.’

“I put a package together and sent it over the following day. I didn’t hear anything until I got a call from the costume designer the following week.

“Oliver Stone wanted it to be a very futuristic looking movie and thought our logo, the way our shirts looked was perfect. He basically wanted to make the apparel a character in the movie. Normally, you have to pay for product placement .

“I remember them calling me and saying ‘we need some shirts.’ So I responded with ‘well, you are going to have to pay us.’

“I had to get a lot of stock ready pretty fast. They wanted a jock strap too which is shown in the film. I started stitching our logo very quickly! They ended up paying us $43,000. It wasn’t so much about the money – more that people thought that Under Armour was special.”

The financial figures for 2014 and beyond certainly attest to that. Their share price rose 62.5 per cent last year while company revenue topped $3 billion for the first time in 2014. Since going public in late 2005, revenue and earnings growth have averaged more than 30 per cent. Under Armour stock has increased 1,022 per cent, compared to a 408 per cent gain by Nike.

“They (adidas and Nike) are each going to grow 8 per cent, our latest figures have us at 22 per cent. In the last five quarters we have grown over 30 per cent,” Plank proudly added.

While Golden State Warriors star Curry, a contender for MVP this season, and Super Bowl winning quarter-back Brady are Under Armour’s key men in the US, the signing of Murray earlier this year caught many in Europe by surprise.

A long term adidas devotee, the world no3 was impressed when speaking with Plank and instantly bought into his ethos. Murray, never one to align himself with conformity, was intrigued with the company’s slightly left-field approach and a promise to create his own line of bespoke tennis shoes to be released later this year.

World No5 Andy Murray recently signed a major four-year deal with the American firm.

Plank isn’t just interested in North America though. And it’s not just about seeing stock fly off the shelves in Abu Dhabi and Dubai. His plan delves far deeper than that. There is a serious push to get people training correctly and efficiently.

The company spent upwards of $600 million buying digital fitness apps MyFitnessPal and Endomondo.

“We see the world as an untapped market and so we are so happy to start making inroads in the Middle East. Revenue from outside the US totals 9 per cent. Our definition of becoming a global brand is to have half our revenues outside our home country,” said the man who is now worth a cool $3 billion.

“Sun and Sand have been terrific partners while we also have a great relationship in Dubai. I’ve got tremendous respect for the people we have dealt with there.

“Sheikh Mohammed is one of my favourite entrepreneurs in the world and the partnership we have there is very exciting. The new store which we have opened in Dubai, we expect to be an important brand there and in the Middle East sport is different there compared to the United States

“The structure is not there yet, the high school systems, athletes compete in the Olympics but not much else. We will help bring a healthier, more active lifestyle, introduce our thoughts on nutrition. That’s our gift.

“We don’t want to just go there and sell shirts and shoes, we want to become an active part of the community. When it comes to the Middle East , Under Armour are just getting started.”

Most popular

EPL's new TV deal has some fearing for future of game

Alam Khan 16/02/2015
  • Facebook
  • Twitter
  • G+
  • Mail
  • Pinterest
  • LinkedIn
  • Facebook
  • Twitter
  • G+
  • WhatsApp
  • Pinterest
  • LinkedIn
Winner or loser? Sky Sports' new English Premier League deal could see subscribers pay more to enjoy domestic action.

Obscene, crazy, eye-watering and staggering. The plethora of verdicts and opinions have been many on the announcement of the Premier League domestic television rights deal for the 2016-19 seasons.

– Inside Story: Why the EPL is within reach for Bournemouth
– FA Cup: Giroud inspires Arsenal as Bradford stun Sunderland
– #360view: How Coquelin became a key cog in Arsenal’s midfield

At £5.136 billion (Dh29bn) – a 70.2 per cent increase on the current agreement of £3.018bn (Dh17.06bn) – the sums were simply stunning.

Sky has paid £4.176bn (£23.6bn) for five of the seven packages on offer – 126 of 168 available live games at a cost of £11.07m (Dh62.5m) per game – while rival BT Sport bought the remaining two for £960m (Dh5.42bn).

It may have been a blind auction, but Sky went in with its eyes very much open to secure its objectives. With BT having snatched the Champions League rights from next season until 2018, it could not afford to lose its prized product.

Richard Keys, who fronted the pay-TV broadcaster’s football coverage when the Premier League was launched in 1992 and is now at Qatar-owned BeIN Sports, believes Sky overpaid.

“I’m staggered by the amounts of money being paid for this deal,” he said. “BT would appear to have got more value for money. It looks as though Sky panicked. Most experts reckon it has overpaid by some £300m (Dh1.69bn). Subscribers can expect some hefty increases in their monthly fees. And, of course, subscribers are fans who ultimately end up paying for everything.”

Sky has said it will soak up the costs in other areas, but such a major investment appears a massive gamble in a climate where football fans are struggling financially to afford subscriptions as well as tickets for live games.

“Sky really did break the bank to land what it has,” says Ben Rumsby, sports news correspondent for the Daily Telegraph.

“It can afford this, just. For Sky, if this is so important as a business it trumps everything else, then what it has spent can be justified.

“But when you look at the fact it faced no serious opposition this time and could have got it for a helluva lot cheaper than they did, then yes it is an obscene amount of money and they have overpaid. But that’s the beauty and deviousness of the Premier League auction. It makes fools out of everyone except the Premier League and its clubs.”

Chris Kamara, though, believes this was a statement of intent from Sky. The former footballer, a regular on the sports channel since 1999, said: “Sky Sports, as long as the Premier League has been around, has had the rights. So to lose it would be catastrophic.

“It was never a thought it would lose out, but when there is competition and BT coming in and buying the Champions League then you have got to worry. This has sent out a message that Sky is serious.”

The deal has emphasised just how much the Premier League has become a valuable commodity.

Sky Sports will be showing 126 of the 168 live English Premier League matches.

With overseas TV rights also expected to top £8bn (Dh45.2bn) later this year, the EPL is the richest domestic league in football, and the second richest in the world behind the NFL.

Chief executive Richard Scudamore says “competitive and compelling football” has helped attract more viewers and made the league a British institution in the same vein as the Royal Family.

But where clubs will benefit from the riches – the 2016/17 champions could get more than £150m (Dh847m) and the bottom club £99m (Dh559.6m) – and, inevitably, help them meet the requirements of UEFA’s Financial Fair Play rules, Scudamore has endured criticism over how the deal could damage English football in the long-term.

The biggest concern is about clubs spending the windfall too lavishly, and wastefully, in desperate attempts to stay, or get into the top flight, and higher wages for players while low-paid stadium staff are not even being paid the living wage.

Vociferous calls have been made too for more of the cash distributed to support grassroots football and reduce ticket prices.

Scudamore said it was not “set up for charitable purposes”, and former UK Government Sports Minister Gerry Sutcliffe says the onus is on the Football Association to ensure the league and clubs act. “That’s part of the problem, the power the Premier League holds over the FA,” he said. “And the FA, as the governing body, is not strong enough to be policing what the Premier League does – and that needs to change.

“I’m not a critic of the Premier League, it’s a good product. But the money needs to be negotiated in a better way so it can get down to the grassroots, to junior football, to help the development of grounds and development of coaching.

Pressure, he adds, could also come from Sky, BT and the PFA, “to make sure it’s very clear and very structured that this money will go down to the grassroots of the game”.

That was something Sutcliffe, along with former Culture Minister Andy Burnham, tried to drive through Government legislation.

Beneficiaries should essentially also include the fans as Malcolm Clarke, chairman of the Football Supporters’ Federation (FSF), said: “Without us there wouldn’t be a television product to generate all this income. In the past we have been the one group to miss out on this. We almost feel like extras on a film set but they get paid. Perhaps now they have enough money to pay us to go matches!

“The Premier League keeps saying we fill the ground, and there’s some truth in that, but there’s strong evidence the numbers include less from low income and middle incomes and are getting older. It’s almost becoming a middle-class activity which is not good for the game.”

The FSF has around 500,000 members, individuals or through affiliated supporters’ clubs, and Clarke says they also advocate more money being filtered down to the grassroots, and from the EPL to the Football League and Confer-ence clubs, but not on inflated transfer fees or wages.

“We would all like to see the best players at our clubs but if you talk to most fans now, they will say but that’s got to be balanced,” he adds.

“We don’t want to see the best players at any price, with the rest of the game being destroyed, the football pyramid – from the Premier League to the lower leagues – being weakened and fans still not getting any benefit through ticket prices.

The English Premier League is the biggest football league in the world.

“Until we can get the FA to be a much firmer governing body, all we can do is keep shining the light of publicity on this. The truth is every time there’s a new deal, we’ve thought the bubble might burst. But far from bursting it gets even bigger.

“I think there could be a back-lash given the sheer scale of this. If the Premier League is not seen to do significantly more, then people will simply say ‘sod this’. It’s about us putting enough pressure on owners to make changes. Hopefully the more enlightened leaders will listen and try to influence the rest.” Rumsby believes this could be “a footballing utopia” in England if the money is used properly.

“Everybody could be a winner. But history tells us that greed tends to win out.”

Compromise is clearly key if history is to be changed, but Kamara also thinks this deal could be surpassed.

“When there’s competition and you have to stay one step ahead of the opposition, then yes,” he adds.

“I don’t think anyone could have envisaged what has happened since 1992. When it changed from the old First Division to the Premier League, the old-school were saying it will never work, it will never take off. But within one season every-one’s opinions had changed.

“Football is getting bigger and better. We have got a great product, some of the best footballers in the world – and that comes at a price.”

Most popular

#360Business: City target lasting legacy

Alam Khan 15/12/2014
  • Facebook
  • Twitter
  • G+
  • Mail
  • Pinterest
  • LinkedIn
  • Facebook
  • Twitter
  • G+
  • WhatsApp
  • Pinterest
  • LinkedIn
All encompassing: City's new academy includes a 7,000 seater stadium for reserve and women's fixtures.

“We are building a structure for the future not just a team of all-stars.”

The message, written in bold in the open-plan reception and meeting area of the new Etihad Campus’s main building speaks volumes.

– Mansour's City vision realised through impressive academy

– Man City open new Dhs1.1bn training complex

Those words from Sheikh Mansour bin Zayed Al Nahyan, UAE deputy prime minister and minister of presidential affairs, came six years and three months ago after he bought Manchester City and brought Abu Dhabi into the footballing spotlight.

They also provided a far greater insight into his long-term ambition for the Premier League club than the £32.5 million (Dh187m) record purchase of Robinho days earlier.

There’s no disguising the fact City have spent heavily to transform them into champions.

Annual accounts for 2013/14 revealed a £23m (Dh132m) loss – including a £16m (Dh92m) penalty for breaching UEFA’s Financial Fair Play rules – but their income of £347m (Dh2 billion) was a £76m (Dh438m) increase on the previous year.

The figures also showed Sheikh Mansour had invested £1.15bn (Dh6.63bn) during his tenure, but big-money signings were allied to their project to create training facilities to develop youth, support a men’s and women’s team, and help regenerate the local community.

As he watched the official unveiling of the £200m (Dh1.15bn) campus – a 190-metre walk over a bridge from the Etihad Stadium – and featuring Etihad Avenue as its central street to emphasise the primary sponsorship of the UAE airline, Academy director Brian Marwood said he had to keep pinching himself at how the dream had become a reality.

He witnessed City’s rise since joining in 2009, and believes Sheikh Mansour deserves respect for breathing life into the club as well as the previously neglected suburbs of Gorton and Beswick.

“We made a statement of intent six years ago with our owners and people perhaps disrespected them in terms of what they were going to do,” he told Sport360°.

“But now people have seen they can create a winning team on the pitch and they can create something unique off the pitch with these facilities. It’s gone beyond money and I hope people now begin to give Sheikh Mansour a lot more credit.

“Not only has he regenerated a football club, he has regenerated a huge part of Manchester and should rightly get the credit he deserves.”

The proof is in the product, which has left many in awe. Even Lionel Messi, according to his Argentina team-mate and City full-back Pablo Zabaleta after a visit for their friendly with Portugal.

With 16 pitches, a 7,000-seater stadium for the juniors and women’s team, an accommodation block, a sixth-form College to serve its local community and scholars, it is a significant step above their old Carrington base.

“They have everything here to be a good professional, and we can’t ask for more; we have everything here,” said Zabaleta.

Women’s team captain and England international Steph Houghton added: “To be able to come in here and call it home, you are going to be inspired.”

City looked at 70 different sports facilities worldwide, including the Australia Institute for Sport, the LA Lakers and Barcelona, and had 19 different designs before choosing the current one.

But Marwood added: “It would be wrong to say we just cut and paste. We did a lot of research, we found some things that were good and some things that were bad.

“But we have a lot of very talented people within the building who came up with a lot of really good ideas that we wanted to integrate and that’s the blueprint of all of those things.”

Chief Infrastructure Officer Jon Stemp helped put it all together and said: “It feels like six-year maternity and it’s special to see it complete. It’s going to leave a legacy. The connection to Abu Dhabi is deep rooted, but we have also learnt so much from how they want to do things.

“Their way of being respectful, their way of being understated and developing our club under those same values has been incredible. It’s given us a clear direction about how to do things.”

City have a clear direction for the future too. With two league titles in three seasons, they have not only challenged neighbours United’s standing as the No1 club in Manchester, but also the No1 attraction for the area’s most promising youngsters and beyond.

That has not gone unnoticed among past heroes of both clubs either.

Colin Bell, the revered City midfielder, said: “Who wouldn’t want to come to train and play at this place? There can’t be anything like this in the world.

“To have the money to buy players and then to look at the best youngsters and get them when they are young, that’s the best of both worlds and that’s what City are trying to do. Of course it will help them become the best.”

Paul Scholes, who came through the ranks at United as part of the famous ‘Class of 92’ side along with David Beckham, Ryan Giggs,Nicky Butt and the Neville brothers , Gary and Phil, too was impressed with what he saw.

He said City have now raised the stakes to an extent where his former club should be concerned. While current United chief Louis van Gaal disagreed and said the quality of coaching will prove key, it is the future that will determine who’s right.

There will no doubt be pressure on City to deliver. Yet it is something they accept and welcome, even if the success is not instant.

Marwood said: “We keep challenging ourselves every day. It’s like the Champions League. People say you must be disappointed at not doing as well as you hoped and yes we are, but it’s not stopping us.

“It would be great to have four or five players who have come through this system playing in our first team. It’s a challenge but that’s the challenge we set ourselves.”

One person relishing that challenge is Patrick Vieira, City’s head of the Elite Development Squad (EDS) and no stranger to success himself during his playing career with clubs such as Arsenal, Internazionale and City.

A World Cup and European Championship winner with France too, he knows what it takes to get to the very top.

Describing the City Football Academy as being on a “different level” to other training centres, he said: “The gap is massive from under-21 to first team, and we need to find the way to bridge the gap.

“Now we have one of the best, if not the best, facilities in the world. We have a clear idea about how we want to play at this club, and everything is there.

“All we need now is time, which you always need with young players. We have to get our heads down and keep working harder.”

The sight of 18-year-old Jose Pozo, part of his EDS team, starting in Saturday’s 1-0 win at Leicester will offer hope to players such as Manchester-born midfielder Kean Bryan.

“It’s a lot of pride when you get to the top, especially when you are a local boy,” said the England Under-19 international. “People look at City as a money club and always spending, but you need to be good to be at that top level. You need to work hard and it’s not a given that it will happen.”

Bell agreed with that attitude, adding: “You can’t just click your fingers and get the best team in the world. It takes time.

“But, with the money [backing] and the players, I now expect City to win the title every year. Is that pressure? No. It’s just a question of time – and it will happen.”

Most popular