If you spend any moment at under armour outlet, you’ll hear that question repeatedly. Founder and CEO Kevin Plank really likes whiteboards, with his fantastic favorite use on their behalf is usually to write down leadership maxims for his team. In and out of his office, whole walls of floor-to-ceiling whiteboards contain a large number of curt principles he’s scrawled over time: Expedite the inevitable. Perfection may be the enemy of innovation. Respect everyone, fear no person.
These commandments are meant less simple inspiration or hard rules, he says, but together constitute a method of “guardrails” that allow everyone under him to function as entrepreneurs by channeling his thinking. The Plank principles are drilled into new employees during a weeklong orientation, and they’re painted all over the hallways at company headquarters, a former Procter & factory in the Baltimore waterfront. Think just like an entrepreneur. Create like an innovator. Perform just like a teammate.
Plank has got the affect and power of a head coach–direct eye-to-eye contact, military analogies, the air of someone you do not desire to disappoint. “Winning is part of our culture–it’s who we have been,” he says within his lofty office overlooking the harbor. (The only real artwork behind his desk: a giant UA logo, its letters stacked to evoke arms raised in victory.) “And culture is created on habits.” Perhaps the most crucial guardrail, along with the company’s official mission, is trying to “make all athletes better.” It has long equaled considering clothes as high-performance gear, but recently it’s taken on a large new meaning.
Within the last 2 yrs, Under Armour has spent near to $1 billion buying and buying three leading makers of activity- and diet-tracking mobile apps. By doing this, the business has amassed the world’s largest digital health-and-fitness community, with 150 million users. Plank envisions all of the users, in addition to their metrics, being a big data engine to operate a vehicle anything from product development to merchandising to marketing. Many observers, though, balked with the $710 million price of the acquisitions, questioning whether Under Armour could quickly produce any roi–a pair of the 3 companies were unprofitable–let alone reach your goals in an area that shares little with making shirts and shoes. Longtime staffers worried the moves would crimp company performance, affect bonuses, or divert focus from your core business. Plank spent more hours than he cares to count, including a large slice of his winter vacation a year ago, in just one-on-one conversations to persuade them otherwise. “It was important,” he says, “that the not just be my decision.”
Under Armour team-sports designers, discussing concepts for uniforms and performance gear they’re making for Plank’s alma mater, the University of Maryland.
Plank enjoys to state that the important thing to Under Armour’s success is the fact he never focused entirely on all the reasons it couldn’t happen. A former Division 1 college football player, Plank famously bootstrapped Under Armour’s launch in 1995 equipped with one simple insight: The cotton undershirts football players wore under their pads slowed them down whenever they became soaked with sweat. After prototyping a moisture-wicking, formfitting alternative–made of fabric for women’s undergarments–and testing it on ex-teammates, Plank set up shop in his grandmother’s basement and, just before he went broke, scored his first big sale, to Georgia Tech. The business proceeded to produce a whole new niche for performance apparel, IPO’d in 2005, and now sponsors a few of the world’s greatest athletes, including Jordan Spieth, Stephen Curry, and Lindsey Vonn.
Today, Under Armour has 13,500 employees all over the world and nearly $4 billion in revenue. But Plank continues to be every bit the entrepreneur, chasing audacious dreams–chief and this includes overtaking Nike because the world’s largest sportswear maker. Under Armour leapfrogged the longtime number two, Adidas, inside the U.S. sportswear market in 2014, but worldwide it’s still third. And Nike remains far larger, with over $30 billion in revenue in 2015 Which is a part of why Plank desires to move so aggressively. Nike has about a fifth several users on its Nike platform as Under Armour does on its apps, as well as in 2014 the shoe giant de-activate its FuelBand fitness-tracker business.
The genuine effort is only beginning, though, as Plank has adopted the kind of world-changing ambitions more common to some Google or Facebook. He envisions that Under Armour Connected Fitness will “fundamentally affect global health.” This month–doubters be damned–the company will start selling a set of biometric fitness devices along with a smart scale made together with the Taiwanese smartphone company HTC. The move will put Plank in direct competition with Fitbit and Apple in the fast-growing wearables market. It’s a bold, characteristically Plankian bet–plus a “very risky” one, says Morningstar retail analyst Paul Swinand. (Morningstar and Inc. are properties of Joe Mansueto.)
“Under Armour is a huge phenomenal success story,” Swinand says. Its stock has risen steadily–almost 2,000 percent within the decade since its IPO. “However when you’re hitting a house run every quarter on the core apparel business, why fool around using a moon shot?”
Plank rarely admits to much uncertainty or doubt, so it’s telling which he echoes Swinand in describing Connected Fitness’s ambitions as a “moon shot.” But another of his whiteboard sayings comes to mind, this particular one thanks to his friend and former United states Special Operations commander Admiral Eric Olson: Nobody ever won a horserace by yelling “Whoa!”
Robin Thurston, co-founder after which CEO of Austin-based app maker MapMyFitness, got his first taste of Plank’s high-speed force-of-will approach once the Under Armour founder cold-called him in July 2013. Plank explained that he loved Thurston’s app MapMyRun. “I run five miles 3 x a week, I log everything, I check out routes after i travel,” Plank began. “What are you doing with the company?”
Thurston replied that he or she was about to increase more venture capital to pursue ambitious expansion plans: The company had bought several hundred domains depending on every exercise, and planned to launch new services for every. Thurston with his fantastic investors saw MapMyFitness as poised to become the best digital health-and-fitness network.
A couple of weeks later, Plank and three key lieutenants showed up early at the Ny City offices of Allen & Company, where Thurston and his team were huddling because of their bankers. The MapMyFitness team got about 20 mins into a detailed PowerPoint presentation when Plank interrupted. “This is certainly awesome,” he explained, “but I would like to hold you back and go talk with Robin myself for a couple minutes”–without any bankers running interference. Forty minutes later, Plank and Thurston returned, and Plank asked the MapMyFitness team if they’d like to see Baltimore, immediately, to look into the Under Armour campus.
It wasn’t 11 a.m. when the group–together with under armour shoes online, who’d been waiting on the airport to hitch a ride on Plank’s jet–pulled up at Under Armour headquarters. Former Washington Redskin LaVar Arrington opened Thurston’s door, and offered a tour from the campus, and also some oatmeal cookies, on the stunned app makers. Within 2 weeks, the parties had agreed that Under Armour would get the startup for $150 million, and Thurston would remain atop MapMyFitness and grow Under Armour’s chief digital officer.
Thurston, a onetime professional cyclist who maintained MapMyFitness’s position as a top fitness app in the iPhone’s earliest days, tells the storyline in his new office in downtown Austin, in the brand-new building where giant images of Under Armour athletes adorn the walls (amid, of course, motivational mantras) and many hundred new engineers along with other tech employees work. In the beginning, Thurston says, Under Armour’s interest had been a puzzler. He’d entertained partnering with insurance providers and media companies, but he always worried they’d exploit all of the data MapMyFitness gathers about people’s personal habits in ways that might violate the trust he’d created with the city. Under Armour had simply never occurred to him as being a home for his company.
But one thing Plank did in that private meeting in New York City was pull up an idea video Under Armour had created earlier that year called “Future Girl.” It showed a young woman starting a morning workout in clothes that have been touch-sensitive and can contact data displays and in many cases change color using the tap of a finger. “I made this for you,” Plank thought to Thurston. (In truth, it had run as a TV commercial; Plank explained it was actually designed for someone like Robin 02dexipky though “I didn’t know who Robin will be.”) He wanted to be sure that Thurston wouldn’t bolt once the sale, but would instead see a fascinating opportunity and lead it. Under Armour had always been a tech company, in its way, Plank explained–however it had struggled with digital.
At Under Armour headquarters, workers’ breaks often involve workouts, similar to this one with an artificial-turf field overlooking Baltimore’s Inner Harbor.
None of the products inside the “Future Girl” video existed then–and a variation of merely one is hitting the market now–but merging performance products with performance data and interactive technology was a top Under Armour priority, given Plank’s instinct that that’s where the world was going. Plank had directed a team many years earlier to make an “electric” product, and they’d think of the E39 compression shirt, which in fact had sensors embedded in the material to track an athlete’s heartbeat. The shirt launched with the 2011 NFL training combine to much fanfare, but a simplified consumer version–a sensor-equipped chest band–had only niche appeal. That experience made Plank realize Under Armour couldn’t take on hardware businesses that employ thousands of engineers and constantly come out incremental innovations.
“It’s absurd you are aware much more about your car or truck than you understand your body,” says Plank. He’s betting athletes’ personal data will turbocharge their fitness and Under Armour’s future.
“It’s very normal for the product company–which happens to be really what Under Armour is–to get gone along the path of trying to generate hardware,” says Thurston. “They understand the distribution channels, they realize how to sell products, they learn how to market them. But as they started doing their homework on what was happening from the space, they discovered that the strength [of digital fitness] was actually locally.”
Plank also knew it would take years to build a community like Thurston’s. “It wasn’t that we didn’t be aware of right solutions to be seeking from engineers. I didn’t know the correct questions to ask,” Plank admits. “I’m a sporting goods guy.”
Once the MapMyFitness acquisition closed at the end of 2013, Plank and Thurston proceeded uncharacteristically slowly, spending time to create priorities for Under Armour’s digital transformation. Thurston identified four key pillars of health–sleep, fitness, activity, and nutrition–which he depending on Plank’s “make all athletes better” mission. Once that vision snapped into focus, Plank saw a chance not only to be considered a collector of human activity data but in addition being the central processor that turns that data–no matter what whose device or app collected it–into useful insights. “OK. Let’s get it done,” he told Thurston 1 day at the end of 2014. By the following March, they had spent more than half a billion dollars acquiring two more companies: San Francisco-based MyFitnessPal, a nutrition-tracking system for anyone to log the meals they eat, and Copenhagen-based Endomondo, a private-training course whose users are almost entirely away from Usa Under Armour suddenly had not just the world’s largest digital fitness community but countless engineers and reams of user data as well.
Merely one big question loomed: How could any one of that will help Under Armour chip away at Nike’s dominance, or at a minimum sell a lot more workout shirts?
Across the railroad tracks in the Under Armour campus, the lowest redbrick building houses the company’s innovation lab, where president of product and innovation Kevin Haley leads a team of biomechanists, designers, engineers, plus a psychologist to develop shoe and apparel concepts. You will find weather chambers to re-create different exercise scenarios, devices that stretch and compress materials, gait-analysis systems, washers and dryers, 3-D printers, laser cutters, and countless other machines. The deeper you enter in the long, narrow lab space, the greater number of secretive the operations. The prototyping room is locked down coming from all but several select employees and executives, who must pass a biometric scanner to enter.
Prior to taking on the innovation lab, Haley created the Under Armour consumer insights department. At the beginning, “the trick of the success was that people were the consumer,” Haley says. “Kevin had been a football player. He just knew. But slowly, we got over the age of our consumer.” The corporation stopped bragging about not using focus groups and started tapping its sponsored athletes for product insights, sending researchers to search in people’s closets, and running surveys online.
What Under Armour didn’t know with much precision, though, was how people used its products after buying them. “You only know if someone swipes a charge card or not,” as Haley puts it–and also that only happens once or twice a year for virtually any customer. “We call something a basketball shirt, but is the guy using it to football practice? Will be the boyfriend shirt he gives to his girlfriend something she wears as pajamas?”
But armed with data from Connected Fitness apps, Haley says, he is able to take design cues from 150 million individuals who, having downloaded a fitness app, are precisely the potential audience: “There’s unbelievable data in there. You know their running pace, how far they go, how frequently they go. You literally know what type of Greek yogurt they normally use.”
It’s too soon to discover many new releases as a result of each of the new data–developing some gear often takes 18 months–but Haley points to 1. The organization learned from MapMyFitness data the average run is 3.1 miles–“not a few miles, not five miles, but 3.1,” Haley says. So when it got to making the Speedform Gemini athletic shoes, which was released last January to largely rave reviews, the business added “charged foam” padding tailored to that particular sort of run.
“The toughest question for people like us is not really, Are available cool technologies available?” says Haley. “It’s, What would you like me to be effective on? This offers us unbelievable insight that’s both incredibly broad and deep, with the exact same group of people we’re marketing toward.” That might be especially useful in both huge growth opportunities for Under Armour. More than 60 percent of Connected Fitness’s users are women, who take into account just 30 percent of Under Armour’s apparel sales. Even though approximately 11 percent of its sales are international, 35 percent of the Connected community is beyond the United states
Still, our prime-stakes bet on Connected Fitness will probably be slow to pay off. Under Armour recently increased its projections for the following two years, estimating which it would nearly double net revenue by 2018, to $7.5 billion (up coming from a previous estimate of $6.8 billion). Only $200 million–a paltry 2.7 percent–can come from Connected Fitness. But Thurston likens his digital community to “using a Super Bowl-size audience each day,” and one of the most immediately practical moves will likely be using those apps as being a marketing channel. A feature called Gear Tracker, for instance, allows under armour sale melbourne users to log the footwear they use when they go running, and have a reminder when their mileage suggests it’s a chance to buy new ones. A partnership with Zappos makes ordering replacements easy.