Under Armour is jumping into the lifestyle business, launching a new category of apparel and footwear, UA Sportstyle, that it says combines both performance and style. The company will use designers, musicians and athletes from around the world to celebrate creativity and the DIY spirit it says the brand was founded on.
The launch centers around the release of the UA Forge 96 (named for the year the company started) later this month. The “dad shoe,” so-called for its super-chunky sole, is already generating buzz among sneakerheads.
And Under Armour is tapping a team of “pioneers” to help introduce it, including Malcolm Jenkins, safety for the Super Bowl champion Philadelphia Eagles, and the Japanese youth collective Tokyo Vitamin. These pioneers are scheduled to run forums in communities around the world, including live shows and workshops meant to celebrate Under Armour’s DIY spirit.
The campaign launch will include a video that follows some brand pioneers in London, Tokyo and Seoul.
An Under Armour spokesperson tells Marketing Daily that the project is led internally, rather than with an ad agency. (Its new training ads, starring Dwayne Johnson and launched earlier this spring, are from Droga5.)
For Under Armour, in the midst of a costly turnaround effort, the new collection represents a growing acceptance that the world is clamoring for lower-priced, hip and stylish shoes, not the high-end performance kicks it built its reputation on.
The NPD Group reports performance shoes continue to fall from favor, dropping an additional 5% to $1.7 billion in the most recent quarter, while sport lifestyle shoes and boots continued to gain, rising 7% to $2.9 billion.
“Athleisure has taken over the athletic footwear market, and I do not expect the performance categories to improve anytime soon,” writes Matt Powell, NPD’s senior industry advisor for the category.
That trend has punished Under Armour. And while its most recent earnings report showed a modest improvement and a stabilizing of the weak North American division, those improvements aren’t coming cheap. The company also told investors it was taking charges of up to $130 million and using them to invest in its struggling business, spending $80 million more than planned. Its net loss for the period jumped to $95.5 million, up from $12.3 million in the same period of the prior year.
Sales climbed 8% to $1.17 billion, and in North America, they eked out a 2% gain.
While sales figures beat expectations, analysts are still skeptical about Under Armour’s ability to regain its footing.
“Brand challenges remain,” writes Christopher Svezia, who follows the company for Wedbush Securities, and remains neutral. He notes that the sales gain came from cost-cutting and liquidating inventory in the off-price channel, “not brand momentum… And it is seeing higher competition among more brands in athletic apparel, with Nike coming back, Reebok seeing momentum, and Champion, Fila, Adidas, Puma, New Balance and Vans gaining share in North America.”
Overseas, the brand is more successful, including a 34% gain for the quarter in the Asia/Pacific region.
The UA Sportstyle effort has plenty of global appeal.Other pioneers introducing it include Hong Kong-based Arthur Yeti of Yeti Out; Seoul-based fashion label IISE; designer Olaf Hussein of Amsterdam’s Ølaf Citizens; London’s streetwear designer Simon Suphandagli and his Ejder label; and Serio us Klein, the Ghanaian-German rapper based in Berlin.