UA: Playing the Olympics Like a Champ

The Winter Olympics is traditionally a big blown-out non-event in the world of sports marketing. Yes, brands make noise about their innovations and new product. But let’s face some facts, most people don’t walk the Streets wearing those luge unitards.


Under Armour is the exception as it relates to brand impact, however. Why? Three of the many holes in its portfolio it has yet to fill are 1) International, 2) Higher-end cold weather outerwear, and 3) Women.  This event gave a lay-up opportunity to show the world that it’s not just a US football brand, and UA soared over a few defenders’ heads and jammed it.


Under Armour is taking full advantage of the 2010 Vancouver Winter Olympics through its official, unofficial, and individual sponsorships.  The ground work was laid in 2002 when UA joined the U.S. Ski Team as a supplier and has blossomed into high profile coverage through official sponsorships of the U.S. Freestyle Ski Team (aerials, moguls, and ski cross), U.S. Bobsled Team, U.S. Skeleton Team, and the Canadian Curling Teams (as an FYI, Curling in Canada is second only to Hockey as a National pastime). 


UA’s unofficial sponsorship can be seen underneath the outerwear with its performance base layers that are worn by most of the US athletes on the slopes.  If you’re watching the games, chances are that you noticed.  I’d argue that this trumps individual sponsorships in this instance. But Under Armour has also invested around cross-over athletes like Lindsey Vonn.  UA compared Vonn’s potential at the Winter Olympics of winning 5 gold medals to Michael Phelps amazing accomplishments of 8 gold medals at the 2008 Summer Games. That’s a bit of a stretch, but heck, UA endorsed Phelps last week last week, so even if they are wrong that still have the Big Man.  


Why Vonn and Phelps?  In the end, the athletes need to either win, but really, they need to capture the hearts and minds of viewers around the world. One of the more powerful ways to do this is by partnering with athletes with broad crossover appeal. By ‘crossover appeal’ I mean Vonn making it into the swimsuit issue of Sports Illustrated (see below), and Phelps endorsing UA’s product for purposes nothing having to do with water – but simply the training apparel/footwear to help him build form. This is also akin to someone like Maria Sharapova for Nike (who has been on the cover of SI and Vogue in the same month), where no one can justify the investment on tennis sales alone, but across a much broader product set.


Under Armour downplayed the impact of the Winter Olympics on their 4Q call and only mentioned it as a small opportunity to be seen as a global player. Our sense is that they fully baked this in to their SG&A guidance, but lowballed revenue opportunity as well as the longer-term brand implications.


See stats below for the market opportunity for UA in the Ski/Snowboard outerwear market. Its current share is sitting between 1-2%. Yes, that’s almost as small as its footwear market share. Big opportunity.


On a related note…Under Armour won the seventh Doc DesRoches Award (other winners include Rossignol, Spyder, and SmartWool) for recognition as an SIA member and U.S. Ski Team supplier for its promotion of the Team's brand and athletes. Under Armour was acknowledged for the national print and TV campaign around World Champion Lindsey Vonn. Check out the commercial:


Zach Brown


Hedgeye Retail 


UA: Playing the Olympics Like a Champ - Endorsements image 1


UA: Playing the Olympics Like a Champ - Endorsements image 2


UA: Playing the Olympics Like a Champ - Lindsey Vonn


UA: Playing the Olympics Like a Champ - Snow Market Size


UA: Playing the Olympics Like a Champ - US Winter Olympics UA Team


UA: Playing the Olympics Like a Champ - US Ski Team Website honoring UA


UA: Playing the Olympics Like a Champ - UA Webstie Image Shot


Cartoon of the Day: Hard-Headed Bears

How's this for "hard data"? So far, 107 of 497 S&P 500 companies have reported aggregate sales and earnings growth of 4.4% and 13.2% respectively.

read more

Premium insight

McCullough [Uncensored]: When People Say ‘Everyone is Bullish, That’s Bulls@#t’

“You wonder why the performance of the hedge fund indices is so horrendous,” says Hedgeye CEO Keith McCullough, “they’re all doing the same thing, after the market moves. You shouldn’t be paid for that.”

read more

SECTOR SPOTLIGHT Replay | Healthcare Analyst Tom Tobin Today at 2:30PM ET

Tune in to this edition of Sector Spotlight with Healthcare analyst Tom Tobin and Healthcare Policy analyst Emily Evans.

read more

Ouchy!! Wall Street Consensus Hit By Epic Short Squeeze

In the latest example of what not to do with your portfolio, we have Wall Street consensus positioning...

read more

Cartoon of the Day: Bulls Leading the People

Investors rejoiced as centrist Emmanuel Macron edged out far-right Marine Le Pen in France's election day voting. European equities were up as much as 4.7% on the news.

read more

McCullough: ‘This Crazy Stat Drives Stock Market Bears Nuts’

If you’re short the stock market today, and your boss asks why is the Nasdaq at an all-time high, here’s the only honest answer: So far, Nasdaq company earnings are up 46% year-over-year.

read more

Who's Right? The Stock Market or the Bond Market?

"As I see it, bonds look like they have further to fall, while stocks look tenuous at these levels," writes Peter Atwater, founder of Financial Insyghts.

read more

Poll of the Day: If You Could Have Lunch with One Fed Chair...

What do you think? Cast your vote. Let us know.

read more

Are Millennials Actually Lazy, Narcissists? An Interview with Neil Howe (Part 2)

An interview with Neil Howe on why Boomers and Xers get it all wrong.

read more

6 Charts: The French Election, Nasdaq All-Time Highs & An Earnings Scorecard

We've been telling investors for some time that global growth is picking up, get long stocks.

read more

Another French Revolution?

"Don't be complacent," writes Hedgeye Managing Director Neil Howe. "Tectonic shifts are underway in France. Is there the prospect of the new Sixth Republic? C'est vraiment possible."

read more

Cartoon of the Day: The Trend is Your Friend

"All of the key trending macro data suggests the U.S. economy is accelerating," Hedgeye CEO Keith McCullough says.

read more