In the event you spend any moment at under armour outlet, you’ll hear that question repeatedly. Founder and CEO Kevin Plank really likes whiteboards, and his awesome favorite use to them is to create leadership maxims for his team. In and out of his office, whole walls of floor-to-ceiling whiteboards contain dozens of curt principles he’s scrawled throughout the years: Expedite the inevitable. Perfection may be the enemy of innovation. Respect everyone, fear no one.
These commandments are meant not as simple inspiration or hard rules, he says, but together comprise a system of “guardrails” that enable everyone under him to function as entrepreneurs by channeling his thinking. The Plank principles are drilled into new employees throughout a weeklong orientation, and they’re painted throughout the hallways at company headquarters, a former Procter & Game factory about the Baltimore waterfront. Think such as an entrepreneur. Create just like an innovator. Perform just like a teammate.
Plank provides the affect and concentration of a head coach–direct eye-to-eye contact, military analogies, air of someone you do not would like to disappoint. “Winning is an element of our culture–it’s who we have been,” he says in the lofty office overlooking the harbor. (The sole artwork behind his desk: a giant UA logo, its letters stacked to evoke arms raised in victory.) “And culture is formed on habits.” Perhaps the most significant guardrail, along with the company’s official mission, is seeking to “make all athletes better.” They have long equaled contemplating clothes as high-performance gear, but recently it’s taken on a major new meaning.
During the last 2 years, Under Armour has spent close to $1 billion buying and investing in three leading makers of activity- and diet-tracking mobile apps. In so doing, the organization has amassed the world’s largest digital health-and-fitness community, with 150 million users. Plank envisions all of the users, as well as their metrics, being a big data engine to operate a vehicle from product development to merchandising to marketing. Many observers, though, balked with the $710 million expense of the acquisitions, questioning whether Under Armour could quickly produce any return–2 of three of the companies were unprofitable–much less reach your goals in a location that shares little with making shirts and shoes. Longtime staffers worried the moves would crimp company performance, affect bonuses, or divert focus through the core business. Plank spent more hours than he cares to count, including a large chunk 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 simply 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 loves to point out that the key to Under Armour’s success is that he never dedicated to all of 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 after they became soaked with sweat. After prototyping a moisture-wicking, formfitting alternative–made from fabric for women’s undergarments–and testing it on ex-teammates, Plank put in place shop in his grandmother’s basement and, just before he went broke, scored his first big sale, to Georgia Tech. The organization went on to generate a totally new niche for performance apparel, IPO’d in 2005, and from now on 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 remains every bit the entrepreneur, chasing audacious dreams–chief and this includes overtaking Nike as being 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 That is component of why Plank would like to move so aggressively. Nike has with regards to 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 actual jobs are only beginning, though, as Plank has adopted the type of world-changing ambitions more usual to your Google or Facebook. He envisions that Under Armour Connected Fitness will “fundamentally affect global health.” This month–doubters be damned–the corporation will begin selling a couple of biometric fitness devices plus a smart scale made in partnership with the Taiwanese smartphone company HTC. The move will put Plank in direct competition with Fitbit and Apple inside the fast-growing wearables market. It’s a bold, characteristically Plankian bet–as well as a “very risky” one, says Morningstar retail analyst Paul Swinand. (Morningstar and Inc. both are belonging to Joe Mansueto.)
“Under Armour has become 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 home run every quarter on the core apparel business, why fool around having 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 pops into your head, this one thanks to his friend and former U.S. 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 he loved Thurston’s app MapMyRun. “I run five miles thrice per week, I log everything, I search for routes when I travel,” Plank began. “What are you doing together with the company?”
Thurston replied that he or she was approximately to increase more venture capital to pursue ambitious expansion plans: The corporation had bought several hundred domains depending on every physical activity, and planned to produce new releases for each and every. Thurston and his investors saw MapMyFitness as poised to get the key digital health-and-fitness network.
A couple of weeks later, Plank and three key lieutenants showed up early with the New York offices of Allen & Company, where Thurston and his awesome team were huddling making use of their bankers. The MapMyFitness team got about twenty minutes into a detailed PowerPoint presentation when Plank interrupted. “This can be awesome,” he explained, “but I want to stop you and go talk to 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 visit Baltimore, without delay, to check out the Under Armour campus.
It wasn’t 11 a.m. once the group–in addition to under armour outlet australia, who’d been waiting in 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, to the stunned app makers. Within 14 days, 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 being a top fitness app in the iPhone’s earliest days, tells the storyline within his new office in downtown Austin, within a brand-new building where giant images of Under Armour athletes adorn the walls (amid, of course, motivational mantras) and several hundred new engineers and also other tech employees work. In the beginning, Thurston says, Under Armour’s interest was actually a puzzler. He’d entertained partnering with insurance providers and media companies, but he always worried they’d exploit each of the data MapMyFitness gathers about people’s personal habits in ways that could 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 first thing Plank did because private meeting in New York was pullup a concept 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 also change color with all the tap of any finger. “I made this to suit your needs,” Plank said to Thurston. (In reality, it had run being a TV commercial; Plank told me it had been created for someone like Robin 02dexipky though “I didn’t know who Robin could be.”) He wanted to make certain that Thurston wouldn’t bolt once the sale, but would instead see a fantastic opportunity and lead it. Under Armour had for ages 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, such as this one upon an artificial-turf field overlooking Baltimore’s Inner Harbor.
Not one of the products from the “Future Girl” video existed then–and a variation of one is hitting the market now–but merging performance products with performance data and interactive technology was really a top Under Armour priority, given Plank’s instinct that that’s in which the world was going. Plank had directed a team several years earlier to make an “electric” product, and they’d put together the E39 compression shirt, that have sensors a part of the material to monitor an athlete’s heart rate. The shirt launched in 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 contest with hardware businesses that employ a large number of engineers and constantly come out incremental innovations.
“It’s absurd you are aware of much more about your car than you know about 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 is really what Under Armour is–to possess gone on the path of attempting to create hardware,” says Thurston. “They know the distribution channels, they learn how to sell products, they understand how to market them. But because they started doing their homework on which was happening in the space, they saw that the strength [of digital fitness] was really in the community.”
Plank also knew it will take years to develop a community like Thurston’s. “It wasn’t which i didn’t understand the right answers to be seeking from engineers. I didn’t have any idea the proper questions you should ask,” Plank admits. “I’m a sporting goods guy.”
After the MapMyFitness acquisition closed at the end of 2013, Plank and Thurston proceeded uncharacteristically slowly, taking time to set priorities for less than Armour’s digital transformation. Thurston identified four key pillars of health–sleep, fitness, activity, and nutrition–he according to Plank’s “make all athletes better” mission. Once that vision snapped into focus, Plank saw an opportunity not just to be considered a collector of human activity data but in addition being the central processor that turns that data–regardless of whose device or app collected it–into useful insights. “OK. Let’s practice it,” he told Thurston one 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 people to log their meals, and Copenhagen-based Endomondo, a personal-training program whose users are almost entirely outside the Usa Under Armour suddenly had not merely the world’s largest digital fitness community but countless engineers and reams of user data at the same time.
Only one big question loomed: How would any one of which help Under Armour chip away at Nike’s dominance, or otherwise sell much more workout shirts?
Throughout 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 formulate shoe and apparel concepts. There are actually 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 go into the long, narrow lab space, the greater secretive the operations. The prototyping room is locked down from all of but a couple of select employees and executives, who must pass a biometric scanner to enter.
Before you take over the innovation lab, Haley created the Under Armour consumer insights department. Early on, “the key of our own success was we were the buyer,” Haley says. “Kevin was actually a football player. He just knew. But slowly, we got over the age of our consumer.” The business stopped bragging about not using focus groups and started tapping its sponsored athletes for product insights, sending researchers to appear 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 just know if someone swipes a credit card or otherwise,” as Haley puts it–and even that only happens a few times each year for virtually any customer. “We call something a basketball shirt, but will be the guy using it to football practice? Is definitely the boyfriend shirt he gives to his girlfriend something she wears as pajamas?”
But equipped with data from Connected Fitness apps, Haley says, he is able to take design cues from 150 million people that, having downloaded a training app, are exactly the target audience: “There’s unbelievable data in there. You realize their running pace, how far they go, how frequently they go. You literally know what type of Greek yogurt they utilize.”
It’s too early to see many new products on account of all of the new data–developing a bit of gear often takes 18 months–but Haley points to one. The corporation learned from MapMyFitness data how the average run is 3.1 miles–“not one or two miles, not five miles, but 3.1,” Haley says. And once it got to making the Speedform Gemini running footwear, which had been released last January to largely rave reviews, the company added “charged foam” padding tailored to that kind of run.
“The toughest question for people is just not, Are there cool technologies on the market?” says Haley. “It’s, What do you want me to work on? This offers us unbelievable insight that’s both incredibly broad and deep, with similar group we’re marketing toward.” That might be especially useful when you are the two huge growth opportunities for Under Armour. More than 60 percent of Connected Fitness’s users are women, who account for just 30 percent of Under Armour’s apparel sales. Even though no more than 11 percent of the sales are international, 35 % of your Connected community is away from Usa
Still, our prime-stakes bet on Connected Fitness is going to be slow to repay. Under Armour recently increased its projections for the upcoming two years, estimating it would nearly double net revenue by 2018, to $7.5 billion (up from your previous estimate of $6.8 billion). Only $200 million–a paltry 2.7 percent–will come from Connected Fitness. But Thurston likens his digital community to “having a Super Bowl-size audience every single day,” and one of the most immediately practical moves will likely be using those apps as being a marketing channel. A characteristic called Gear Tracker, for example, allows under armour sale melbourne users to log the sneakers they prefer every time 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.