Under Armour’s Big Digital Play
The sports brand is making savvy moves into the wearables market, surpassing misguided apparel giants with software plays. Is an overthrow imminent?
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Having recently surpassed Adidas, Under Armour is now the second largest fitness apparel brand in the U.S. and is clawing at the heels of Nike.
And if we’re talking wearable devices, it’s taken a massive step forward as the Swoosh has stumbled. Last year, Nike axed its FuelBand. Then just last week Nike announced that users can use the Nike+ Fuel app—without the brand’s hardware. The move tacitly acknowledges what we already knew: Nike misfired on wearables and is ditching the hardware space entirely in favor of integrating its app with Apple’s HeathKit.
In the meantime, Under Armour has adopted a completely different approach.
At the start of February, the company bought MyFitnessPal for $475 million and Endomondo for $85 million. That purchase balloons Under Armour’s digital user base of athletically inclined people to over 120 million when you combine the 30 million MapMyFitness subscribers, which Under Armour acquired in 2013.
That’s when Robin Thurston, chief digital officer at Under Armour, joined the apparel giant. The former head of the MapMy brands brought his entire team to Under Armour because he was excited about the resources the big company could bring to the development table. “There are thousands of trainers, physiologists, behaviorists at Under Armour,” Thurston says. “Imagine what happens when they start to design apps and products around user experiences.”
The end game is to harness the company’s research on athletic performance to build better apps, wearables, and even apparel, says Thurston. Under Armour will be able to collect a broad range of data from sports including skiing and snowboarding (Under Armour makes whole lines of snowsports apparel, including a new three-layer GoreTex outerwear set), running, soccer, football, and CrossFit. As for wearable hardware to track all these activities, Thurston says there are products in the works.
“There are thousands of trainers, physiologists, behaviorists at Under Armour. Imagine what happens when they start to design apps and products around user experiences.”
While Under Armour won’t use an individual’s personal metrics, it will want to know—broadly and anonymously—how users exercise and even the gear they use, says Thurston. Because beyond making better apps, Under Armour wants to make better gear.
Currrently, “the feedback loop is a little sloppy,” he says. Under Armour doesn’t know, for example, whether CrossFitters are working out in running shoes and runners are running in CrossFit shoes. With the app, users could opt to share the products they use and why. “We don’t care if it’s not made by us. We think we can learn a lot from this information we’re not learning now,” says Thurston.
Of course, Under Armour’s goal is to sell equipment and make money. One way to push app users into the company’s apparel is to reward them with coupons or points that count toward Under Armour purchases. Another way: to use the platform as a way to get gear ads to consumers.
And that gets us to one of the company’s main challenges: not alienating the loyal communities who already use the apps it has purchased.
Phil Beene, co-founder and president of the fitness app Nudge, says Under Armour needs to understand its users before making any changes to their data or inundating them with ads. Outdoor athletes tend to use multiple platforms, depending on their sport, he says. Maybe Snocru for skiing, a Garmin head unit for cycling, MapMyRun for running, and Strava to share PRs and post to Strava. Under Armour would do well to recognize its role as a fitness app platform that has an open sharing environment compatible with third-party apps. If there’s any question that a brand isn’t dominant on all fronts, the best hedge, according to Beene, is to let users share and use data broadly.
You just have to think back on the uproar Instagram caused in 2013 when it launched McDonalds ads in user newsfeeds to understand what he’s talking about. The backlash against the marketing content was fierce, and evidence of what happens when a rabid app user base gets fired up about a change of ownership. “Community is really hard to get right,” Beene says. He speculates users will rebel if Under Amour’s apps get invaded by a flurry of Under Armour ads.
According to Thurston, the company has no current plans to advertise on the platform or restrict users’ data. “We’re not going to advertise to you, we’re not going to say you can’t share your data with other apps. And we’re not going to tell you that because you’re being more active you should buy a bunch of Under Armour shorts.”
In the near term, Thurston says the company’s goal behind the new fitness app acquisitions is simple—get people to work out more frequently.
“The more we can inspire them personally, with apps, then we’ve got this huge pool of people exercising more, and there’s a massive social benefit in that.”