- The Washington Times - Thursday, February 5, 2009

Under Armour started with clothes, then moved into cleats and cross-trainers. Now the Baltimore-based company has entered its broadest market yet with a line of running shoes.

The apparel and footwear manufacturer debuted six running shoes during Super Bowl weekend in Tampa, Fla., offering a new competitor in a marketplace that already has a ton of players.

The debut of the running shoes comes one year after the introduction of the Under Armour cross-trainer, which the company promoted using a high-profile commercial during Super Bowl XLII. This year, Under Armour stayed out of the television ad game but did have a strong presence in Tampa during Super Bowl festivities.

“The running shoe launch was definitely more hand-to-hand combat,” Under Armour senior vice president Steve Battista said. “We had thousands and thousands of kids, adults, athletes come through our combines and let them run on the treadmill and try them out and then direct[ed] them to retailers in Tampa where they could buy right there.”

The running shoe market is large and competitive, with dozens of companies, including Nike, Adidas, Asics and New Balance, vying for at least $2.5 billion worth of business. Moreover, runners are fiercely loyal to their shoes and are loath to switch brands. But Battista said Under Armour’s market research suggests a new product might be well-received.



“The encouraging thing is that whether you speak to a run specialty dealer or one of the big box retailers when it comes to the category of running, they are thirsting for a brand with a new story that can come in and be disruptive,” he said. “And if there’s one thing Under Armour can guarantee is that we’ll be disruptive with every launch we do.”

The features of the Under Armour shoe line include a “FootSleeve” that hugs the foot and keeps it from sliding, and each of the six shoes - four road and two trail - are designed for a specific arch type.

For Under Armour, the running shoe launch is part of a steady but fast-moving strategy to become one of the largest sports-related companies in the world. The company started as a niche maker of clothing designed to stay cool and dry during workouts. Since then, it has moved into footwear while also sponsoring several major college athletic departments, the Senior Bowl and a series of football training combines.

Until now, the majority of its sales have been U.S. based, but the new shoe should allow it to boost international sales while also tapping into a large market of female athletes.

“I’d say we’re definitely the preferred brand of the ‘team girl,’ but now with the launch of running it allows us to go for a slightly older demographic, with women who maybe don’t compete on the field anymore but still work out regularly,” Battista said. “And the positive thing we’re hearing from our focus groups is that the ‘team girl’ does not stop working out and competing once their playing days are over in college and high school. The sport and workout of choice is by far hitting the treadmill or a road race.”

Of course, Under Armour is launching the new shoe line during the worst economic recession in the past quarter-century. It fourth-quarter earnings, announced last week, fell by half over the same period a year ago, while sales fell from $105.7 million to $103 million. At least one financial analyst warned that the timing of the shoe launch was not ideal.

Battista, however, said it was important for the company to continue pursuing growth opportunities during the economic downturn.

“We had a plan and strategy in place,” he said. “The milestones we had in place, from football cleats to training shoes to running shoes to eventually basketball shoes. Those milestones were put in place for a reason, and we have a very deliberate cadence. Obviously we’re aware of what’s going on, and you have to make adjustments, but at the same time, you can’t change your strategy.”

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