If you spend any time at under armour melbourne australia, you’ll hear that question again and again. Founder and CEO Kevin Plank really likes whiteboards, with his fantastic favorite use for these people is to create leadership maxims for his team. Outside and inside his office, whole walls of floor-to-ceiling whiteboards contain many curt principles he’s scrawled over time: Expedite the inevitable. Perfection is the enemy of innovation. Respect everyone, fear no one.
These commandments are meant much less simple inspiration or hard rules, he says, but together make up a method of “guardrails” that enable everyone under him to use as entrepreneurs by channeling his thinking. The Plank principles are drilled into new employees during the weeklong orientation, and they’re painted throughout the hallways at company headquarters, a former Procter & Game factory about the Baltimore waterfront. Think like an entrepreneur. Create as an innovator. Perform just like a teammate.
Plank provides the affect and concentration of a head coach–direct eye contact, military analogies, the environment of an individual you may not wish to disappoint. “Winning is an integral part of our culture–it’s who our company is,” he says within his lofty office overlooking the harbor. (The sole artwork behind his desk: a huge UA logo, its letters stacked to evoke arms raised in victory.) “And culture is formed on habits.” Perhaps the main guardrail, and also the company’s official mission, is wanting to “make all athletes better.” They have long equaled thinking about clothes as high-performance gear, but recently it’s adopted a big new meaning.
During the last 2 years, Under Armour has spent near to $1 billion buying and investing in three leading makers of activity- and diet-tracking mobile apps. By doing so, the business has amassed the world’s largest digital health-and-fitness community, with 150 million users. Plank envisions those users, in addition to their metrics, as being a big data engine to drive everything from product development to merchandising to marketing. Many observers, though, balked at the $710 million value of the acquisitions, questioning whether Under Armour could quickly produce any return–2 of three of the companies were unprofitable–let alone flourish 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 the core business. Plank spent more hours than he cares to count, including a large slice of his winter vacation a year ago, in a single-on-one conversations to persuade them otherwise. “It was actually important,” he says, “this not just be my decision.”
Under Armour team-sports designers, discussing concepts for uniforms and gratification gear they’re making for Plank’s alma mater, the University of Maryland.
Plank loves to point out that the real key to Under Armour’s success is the fact that he never dedicated to 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 particular insight: The cotton undershirts football players wore under their pads slowed them down once 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 create shop in their grandmother’s basement and, right before he went broke, scored his first big sale, to Georgia Tech. The corporation went on to create a totally new niche for performance apparel, IPO’d in 2005, and from now on sponsors a number of the world’s greatest athletes, including Jordan Spieth, Stephen Curry, and Lindsey Vonn.
Today, Under Armour has 13,500 employees around the globe and nearly $4 billion in revenue. But Plank is still every bit the entrepreneur, chasing audacious dreams–chief one of them overtaking Nike as being the world’s largest sportswear maker. Under Armour leapfrogged the longtime number two, Adidas, within the United states sportswear market in 2014, but worldwide it’s still third. And Nike remains far larger, exceeding $30 billion in revenue in 2015 Which can be a part of why Plank would like to move so aggressively. Nike has about a fifth as much users on its Nike platform as Under Armour does on its apps, and in 2014 the shoe giant turn off its FuelBand fitness-tracker business.
The genuine work is only beginning, though, as Plank has adopted the level of world-changing ambitions more prevalent to some Google or Facebook. He envisions that Under Armour Connected Fitness will “fundamentally affect global health.” This month–doubters be damned–the corporation will start selling a pair of biometric fitness devices and a smart scale made together with the Taiwanese smartphone company HTC. The move will put Plank in direct competition with Fitbit and Apple within the fast-growing wearables market. It’s a bold, characteristically Plankian bet–along with a “very risky” one, says Morningstar retail analyst Paul Swinand. (Morningstar and Inc. are generally owned by Joe Mansueto.)
“Under Armour has been a phenomenal success story,” Swinand says. Its stock has risen steadily–almost 2,000 percent in the decade since its IPO. “But once you’re hitting a house run every quarter in the core apparel business, why fool around using a moon shot?”
Plank rarely admits to much uncertainty or doubt, so it’s telling that he echoes Swinand in describing Connected Fitness’s ambitions as a “moon shot.” But another of his whiteboard sayings pops into your head, this particular one thanks to his friend and former Usa 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 as soon as the Under Armour founder cold-called him in July 2013. Plank explained that he or she loved Thurston’s app MapMyRun. “I run five miles 3 times weekly, I log everything, I lookup routes when I travel,” Plank began. “What exactly are you doing using the company?”
Thurston replied that he or she was about to boost more venture capital to pursue ambitious expansion plans: The company had bought several hundred domains according to every exercising, and planned to launch new releases for each. Thurston along with his investors saw MapMyFitness as poised in becoming the best digital health-and-fitness network.
A couple of weeks later, Plank and three key lieutenants showed up early in the The Big Apple offices of Allen & Company, where Thurston with his fantastic team were huddling making use of their bankers. The MapMyFitness team got about 20 mins right into a detailed PowerPoint presentation when Plank interrupted. “This really is awesome,” he stated, “but I want to stop you and go speak to Robin myself for a few minutes”–without the bankers running interference. Forty minutes later, Plank and Thurston returned, and Plank asked the MapMyFitness team if they’d like to visit Baltimore, right away, to look into the Under Armour campus.
It wasn’t 11 a.m. if the group–in addition to 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 of the campus, as well as some oatmeal cookies, for the stunned app makers. Within 2 weeks, the parties had agreed that Under Armour would acquire the startup for $150 million, and Thurston would remain atop MapMyFitness and become Under Armour’s chief digital officer.
Thurston, a onetime professional cyclist who maintained MapMyFitness’s position as a top fitness app from the iPhone’s earliest days, tells the storyline in their 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. At the beginning, Thurston says, Under Armour’s interest was really 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 would violate the trust he’d designed with the neighborhood. Under Armour had simply never occurred to him as being a home for his company.
But the initial thing Plank did in that private meeting in New York 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 had been touch-sensitive and can call up data displays and in many cases change color together with the tap of your finger. “I made this for you,” Plank thought to Thurston. (In truth, it had run being a TV commercial; Plank explained to me it was made for someone like Robin 02dexipky though “I didn’t know who Robin can be.”) He wanted to make certain that Thurston wouldn’t bolt right after the sale, but would instead see a thrilling opportunity and lead it. Under Armour had always been a tech company, in the way, Plank explained–but it really had struggled with digital.
At Under Armour headquarters, workers’ breaks often involve workouts, similar to this one upon an artificial-turf field overlooking Baltimore’s Inner Harbor.
None of the products in 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 the location where the world was going. Plank had directed a team several years earlier to make an “electric” product, and they’d think of the E39 compression shirt, that have sensors baked into the fabric to monitor an athlete’s pulse rate. The shirt launched on 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 contend with hardware companies that employ a huge number of engineers and constantly turn out incremental innovations.
“It’s absurd that you know more details on your car than you understand the body,” says Plank. He’s betting athletes’ personal data will turbocharge their fitness and Under Armour’s future.
“It’s very normal to get a product company–which happens to be really what Under Armour is–to obtain gone along the path of trying to generate hardware,” says Thurston. “They are fully aware the distribution channels, they learn how to sell products, they learn how to market them. But as they started doing their homework on which was happening from the space, they saw that the strength [of digital fitness] was really locally.”
Plank also knew it could take years to construct a community like Thurston’s. “It wasn’t i didn’t are aware of the right strategies to be seeking from engineers. I didn’t know the best questions to ask,” Plank admits. “I’m a sporting goods guy.”
Following the MapMyFitness acquisition closed in late 2013, Plank and Thurston proceeded uncharacteristically slowly, taking time setting priorities for Under Armour’s digital transformation. Thurston identified four key pillars of health–sleep, fitness, activity, and nutrition–which he based on Plank’s “make all athletes better” mission. Once that vision snapped into focus, Plank saw the opportunity not just to be a collector of human activity data but additionally to get the central processor that turns that data–no matter whose device or app collected it–into useful insights. “OK. Let’s undertake it,” he told Thurston one day in late 2014. Through the following March, they had spent over fifty percent a billion dollars acquiring two more companies: San Francisco-based MyFitnessPal, a nutrition-tracking system for individuals to log their meals, and Copenhagen-based Endomondo, a private-training program whose users are almost entirely away from U.S. Under Armour suddenly had not merely the world’s largest digital fitness community but numerous engineers and reams of user data as well.
Just one big question loomed: How could any of that assist Under Armour chip away at Nike’s dominance, or otherwise sell far more workout shirts?
Throughout the railroad tracks from the Under Armour campus, a low redbrick building houses the company’s innovation lab, where president of product and innovation Kevin Haley leads a team of biomechanists, designers, engineers, as well as a psychologist to produce shoe and apparel concepts. There are 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 more secretive the operations. The prototyping room is locked down from all of the but a few select employees and executives, who must pass a biometric scanner to penetrate.
Before you take on the innovation lab, Haley came up with Under Armour consumer insights department. Early on, “the key of our success was we were the consumer,” Haley says. “Kevin was a football player. He just knew. But slowly, we got older than our consumer.” The business 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 simply know if a person swipes credit cards or otherwise,” as Haley puts it–and also that only happens once or twice a year for almost any customer. “We call something a basketball shirt, but is definitely the guy wearing 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 people who, having downloaded a fitness app, are exactly the target market: “There’s unbelievable data in there. You know their running pace, just how far they go, how many times they go. You literally know what make of Greek yogurt they utilize.”
It’s too soon to find out many new services because of each of the new data–developing a sheet of gear typically takes eighteen months–but Haley points to just one. The organization learned from MapMyFitness data the average run is 3.1 miles–“not a couple of miles, not five miles, but 3.1,” Haley says. And once it got to making the Speedform Gemini athletic shoes, that was released last January to largely rave reviews, the corporation added “charged foam” padding tailored to this sort of run.
“The toughest question for all of us is not, Are available cool technologies available?” says Haley. “It’s, What would you like me to function on? This offers us unbelievable insight that’s both incredibly broad and deep, with similar group of people we’re marketing toward.” Which can be especially useful in both the huge growth opportunities for Under Armour. Over 60 % of Connected Fitness’s users are women, who are the cause of just 30 percent of Under Armour’s apparel sales. Even though no more than 11 percent from the sales are international, 35 % from the Connected community is outside of the Usa
Still, our prime-stakes bet on Connected Fitness is going to be slow to get rid of. Under Armour recently increased its projections for the next 2 years, estimating it would nearly double net revenue by 2018, to $7.5 billion (up from a previous estimate of $6.8 billion). Only $200 million–a paltry 2.7 percent–should come from Connected Fitness. But Thurston likens his digital community to “possessing a Super Bowl-size audience every day,” and one of the most immediately practical moves will be using those apps as being a marketing channel. An attribute called Gear Tracker, as an example, allows under armour outlet melbourne users to log the sneakers they use every time they go running, and acquire a reminder when their mileage suggests it’s time to buy brand new ones. A partnership with Zappos makes ordering replacements easy.