If you spend whenever at under armour melbourne australia, you’ll hear that question time and again. Founder and CEO Kevin Plank really likes whiteboards, and his awesome favorite use on their behalf is usually to write out leadership maxims for his team. Inside and outside his office, whole walls of floor-to-ceiling whiteboards contain many curt principles he’s scrawled over the years: Expedite the inevitable. Perfection is the enemy of innovation. Respect everyone, fear no person.
These commandments are meant not as simple inspiration or hard rules, he says, but together constitute a system of “guardrails” that enable everyone under him to operate as entrepreneurs by channeling his thinking. The Plank principles are drilled into new employees in a weeklong orientation, and they’re painted all around the hallways at company headquarters, a former Procter & factory on the Baltimore waterfront. Think like an entrepreneur. Create just like an innovator. Perform similar to a teammate.
Plank has got the affect and power of a head coach–direct eye contact, military analogies, the atmosphere of someone you do not want to disappoint. “Winning is a part of our culture–it’s who we have been,” he says in his lofty office overlooking the harbor. (The only 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, along with 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 huge new meaning.
In the last two years, Under Armour has spent in close proximity to $1 billion buying and making an investment 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 all of those users, and their metrics, being a big data engine to operate a vehicle everything 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 on your investment–2 of three of the companies were unprofitable–much less reach your goals in a space 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, such as a large chunk of his winter vacation last year, in one-on-one conversations to persuade them otherwise. “It was important,” he says, “that this not simply be my decision.”
Under Armour team-sports designers, discussing concepts for uniforms and gratifaction gear they’re making for Plank’s alma mater, the University of Maryland.
Plank loves to state that the true secret to Under Armour’s success is the fact 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 whenever 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 their grandmother’s basement and, right before he went broke, scored his first big sale, to Georgia Tech. The company proceeded to generate a totally new marketplace for performance apparel, IPO’d in 2005, 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 around the world and nearly $4 billion in revenue. But Plank remains to be 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 # 2, Adidas, from the U.S. sportswear market in 2014, but worldwide it’s still third. And Nike remains far larger, exceeding $30 billion in revenue in 2015 Which is element of why Plank wishes to move so aggressively. Nike has in regards to a fifth as many users on its Nike platform as Under Armour does on its apps, and in 2014 the shoe giant shut down its FuelBand fitness-tracker business.
The actual job is only beginning, though, as Plank has adopted the type of world-changing ambitions more prevalent into a 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 some 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 inside the fast-growing wearables market. It’s a bold, characteristically Plankian bet–and a “very risky” one, says Morningstar retail analyst Paul Swinand. (Morningstar and Inc. are both owned by Joe Mansueto.)
“Under Armour is a huge phenomenal success story,” Swinand says. Its stock has risen steadily–almost 2,000 percent inside the decade since its IPO. “But when you’re hitting a property run every quarter around the core apparel business, why mess 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 being a “moon shot.” But another of his whiteboard sayings pops into your head, this 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 then CEO of Austin-based app maker MapMyFitness, got his first taste of Plank’s high-speed force-of-will approach when the Under Armour founder cold-called him in July 2013. Plank explained he loved Thurston’s app MapMyRun. “I run five miles 3 x weekly, I log everything, I check out routes when I travel,” Plank began. “What exactly are you doing using the company?”
Thurston replied that he was approximately to raise more venture capital to pursue ambitious expansion plans: The business had bought several hundred domains according to every exercising, and planned to produce new items for every single. Thurston and his awesome investors saw MapMyFitness as poised to become the leading digital health-and-fitness network.
A couple of weeks later, Plank and three key lieutenants showed up early in the New York offices of Allen & Company, where Thurston along with his team were huddling making use of their bankers. The MapMyFitness team got about twenty or so minutes into a detailed PowerPoint presentation when Plank interrupted. “This is certainly awesome,” he stated, “but I would like to stop you and go speak to Robin myself for several minutes”–without any bankers running interference. Forty minutes later, Plank and Thurston returned, and Plank asked the MapMyFitness team if they’d like to attend Baltimore, straight away, to check out the Under Armour campus.
It wasn’t 11 a.m. as soon as the group–along with melbourne under armour outlet online, 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 in the campus, in addition to some oatmeal cookies, for the stunned app makers. Within two 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 being a top fitness app from the iPhone’s earliest days, tells the history in the new office in downtown Austin, inside a brand-new building where giant images of Under Armour athletes adorn the walls (amid, naturally, motivational mantras) and plenty of 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 companies and media companies, but he always worried they’d exploit each of the data MapMyFitness gathers about people’s personal habits in ways that might violate the trust he’d built with the city. Under Armour had simply never occurred to him as being a home for his company.
But the first thing Plank did for the reason that 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 were touch-sensitive and might contact data displays and in many cases change color using the tap of the finger. “I made this for yourself,” Plank believed to Thurston. (In reality, it had run being a TV commercial; Plank explained it was manufactured for someone like Robin 02dexipky though “I didn’t know who Robin would be.”) He wanted to ensure that Thurston wouldn’t bolt once the sale, but would instead see a fantastic opportunity and lead it. Under Armour had 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, like this one upon an artificial-turf field overlooking Baltimore’s Inner Harbor.
Not one of the products within the “Future Girl” video existed then–along with a variation of one is striking 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 several years earlier to produce an “electric” product, and they’d develop the E39 compression shirt, which had sensors baked into the fabric to follow an athlete’s heart rate. 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 compete with hardware businesses that employ 1000s of engineers and constantly prove incremental innovations.
“It’s absurd you know 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 to get a product company–which is really what Under Armour is–to possess gone along the path of trying to create hardware,” says Thurston. “They are aware the distribution channels, they understand how to sell products, they understand how to market them. But as they started doing their homework of what was happening within the space, they discovered that the strength [of digital fitness] was actually in the neighborhood.”
Plank also knew it might take years to build a community like Thurston’s. “It wasn’t i didn’t be aware of right strategies to be seeking from engineers. I didn’t have any idea the correct things to ask,” Plank admits. “I’m a sporting goods guy.”
Following the MapMyFitness acquisition closed at the end of 2013, Plank and Thurston proceeded uncharacteristically slowly, spending time to set priorities for Under Armour’s digital transformation. Thurston identified four key pillars of health–sleep, fitness, activity, and nutrition–which he based upon Plank’s “make all athletes better” mission. Once that vision snapped into focus, Plank saw a chance not just to be described as a collector of human activity data and also to get the central processor that turns that data–no matter what whose device or app collected it–into useful insights. “OK. Let’s undertake it,” he told Thurston 1 day in late 2014. From the following March, that 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, an individual-training curriculum whose users are almost entirely outside of the United states Under Armour suddenly had not only the world’s largest digital fitness community but a huge selection of engineers and reams of user data too.
Merely one big question loomed: How could any one of that help Under Armour chip away at Nike’s dominance, or at best sell a lot more workout shirts?
Across the railroad tracks through 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. 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 enter in the long, narrow lab space, the greater number of 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 penetrate.
Before taking across the innovation lab, Haley created the Under Armour consumer insights department. In early stages, “the secret of the success was we were the buyer,” Haley says. “Kevin had been a football player. He just knew. But slowly, we got more than our consumer.” The business stopped bragging about not using focus groups and started tapping its sponsored athletes for product insights, sending researchers to check 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 merely know if an individual swipes a credit card or perhaps not,” as Haley puts it–as well as that only happens a few times a year for virtually any customer. “We call something a basketball shirt, but is definitely 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, they can take design cues from 150 million people that, having downloaded an exercise app, are exactly the target market: “There’s unbelievable data in there. You understand their running pace, how far they go, how frequently they go. You literally determine what make of Greek yogurt they normally use.”
It’s too early to see many new services on account of all of the new data–developing some gear often takes eighteen months–but Haley points to just one. The corporation learned from MapMyFitness data how the average run is 3.1 miles–“not a couple of miles, not five miles, but 3.1,” Haley says. When it came to making the Speedform Gemini running shoe, which was released last January to largely rave reviews, the corporation added “charged foam” padding tailored to that particular sort of run.
“The toughest question for people is not, Are there any cool technologies around?” says Haley. “It’s, What do you need me to work on? This gives us unbelievable insight that’s both incredibly broad and deep, using the same population group we’re marketing toward.” That could be especially helpful in the two huge growth opportunities for Under Armour. A lot 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 from the sales are international, 35 % in the Connected community is beyond the United states
Still, the high-stakes bet on Connected Fitness will likely 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 coming 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 “developing a Super Bowl-size audience daily,” and probably the most immediately practical moves will probably be using those apps being a marketing channel. A function called Gear Tracker, for instance, allows under armour outlet melbourne users to log the shoes they normally use every time they go running, and obtain a reminder when their mileage suggests it’s time and energy to buy brand new ones. A partnership with Zappos makes ordering replacements easy.