Shoes Marketing Project
Comparison of Adidas, Nike, and Under Armour Companies
This paper aims to compare and contrast daily stock price, economic forecast, and revenue of Adidas, Nike, and Under Armour companies and their financial strategic related to athletic departments. This paper also critiques analyzes the marketing plans of these companies and identifies long-time contracts and what benefits these contracts are providing to the athletic department. Nike Inc., Adidas, and Under Armour are the three biggest dealers in the competitive athletic attire business. Despite the fact that the athletic industry is supported by numerous different competitors, Under Armour, Adidas, and Nike are the three of the most prominent. Their apparel is universally worn in a selection of sports clubs, including the NBA. All of these companies have carved out a remarkable market share in an increasing and growing inventive industry. These companies are both in the athletic gear firms. They comprise sportswear for both women and men, making different many items such as shoes, t-shirts, tanks, pants, shorts, and sweatshirts. As the three companies look to digitally change their businesses, Adidas is focusing on a design by opening up its brand to customers and other designers while Nike is more attentive to new materials for its products. On the other hand, Under Armour focuses to make all athletes greater through passion, design, and the relentless pursuit of innovation.
In terms of their history, Adidas was found in 1948. It started in a small town in Bavaria, Germany. Adidas originated from a bitter disagreement between two brothers, Adi Dassler and Rudolph. It has its roots in Germany although it is a truly global company. Adidas headquarter is in Herzogenaurach, Germany. Nike was established as an distributer of Japanese shoes. Its predecessor started in 1964, an invention of the imaginings of Philip H. Knight who was a Stanford University business alumni. It was established in 1964 as Blue Ribbon Sports by Bill Bowerman, who was a track-and-field trainer at the University of Oregon, and his former scholar Phil Knight. It is headquartered in Beaverton, Oregon. On the other hand, Under Armour is headquartered in Baltimore, Maryland, and founded by Kevin Plank in 1996. All these companies are players in the profitable market for athletic apparel. Adidas seems to have room for growth while Nike is the giant of the productiveness. Under Armour is a pure growth play.
Adidas boasted a market capitalization of nearly $63 billion as of early November 2020. Alternatively, ADR was valued at $163 per share with a price-to-earnings (P/E) ratio of over 36 and trailing yearly dividend produce of 1.93%. In comparison, Nike had a market capitalization of approximately $203 billion as of early November 2020. Its share price was more than $129, and its P/E ratio was 76.79. Bonuses were produced at 0.79%. In contrast, Under Armour’s market capitalization was nearly $6.36 billion as of early November 2020 (James & Whitney, 2018). Its stock was trading at around $14 per share. All of these companies have their individual different branding. One thing about Nike is that it has a renewed commitment to female athletes that distinguishes it from Adidas and Under Armour, particularly in the rise of the 2019 Women’s World Cup — it sponsored 14 of the 24 teams. Adidas, Nike, and Under Armour are the most popular athletics footwear brands but Nike dominates the market with a 46 percent share as of 2017. Even though Nike is very strong in footwear, Under Armour is stronger in apparel. Nike has a greater worldwide revenue compared to its leading competitors, Under Armour and Adidas. Just the same as Nike, athletic footwear is the main significant classification for Under Armour and Adidas. In 2019, more than 50 percent of Adidas net trades were made by the footwear category. In 2019, over 50 percent of the Adidas Group net sales were generated by the footwear category.
In 2020 Nike saw a slight revenue dip from $39.1 billion to $37.4 billion in a way that was more than seven times greater than Under Armour’s whole 2019 sales of $5.3 billion (Jaworek & Karaszewski, 2020). Under Armour footwear and apparel sales of $1.2 billion through the culmination of August were edging ahead of Adidas with $1.1 billion overall United States sales, according to a Sterne Agee report (James & Whitney, 2018). Under Armour’s second-quarter net loss extended to 40 cents per share or $182.9 million, from a loss of 4 cents a share or $17.3 million a year earlier. Whereas Adidas was at first recognized as a soccer make, its possession of the other make designations creates it as a varied competitor in athletic goods and apparel. Nike is the leading all over the world. In precise, it upholds the leading market share in the athletic apparel business in North America (Jaworek & Karaszewski, 2020). The firm has made noteworthy efforts in the present years to deal with damaging insights about its labor practices in developing markets. Under Armour winded up a tough 2020. It anticipates simply modest development in earnings per share in 2021 after an entire year revenue deterioration for 2020 that was predictable to be in the high teens.
Under Armour publicized the signing of a contract with Brazilian supermodel Gisele Bundchen for its largest ever, $15 million ad promotion aimed at women. From the contract, Under Armour has become a high-class dealer to teams at the U.S. Naval Academy and Notre Dame, hence expanded into Brazil and made trademarked stores in New York City and China. Under Armour also had a long-term contract with NFL that allowed the brand to be displayed on accessories like gloves during games. Nike also had a contract signed with NFL whereby they decided to extend their partnership for another eight years. From the contract, Nike will continue to supply all 32 NFL teams with sideline apparel and uniform until 2028. On the other hand, Adidas penned a long-term contract with Manchester United in a £750m deal over 10 years. In conclusion, each company has its own financial strategies related to the athletic department.
James, C. R., & Whitney, K. (2018). Under Armour: repositioning for the global stage. The CASE Journal.
Jaworek, M., & Karaszewski, W. (2020). The largest athletic apparel, accessories and footwear multinational companies: economic characteristics, internationalization. Journal of Physical Education & Sport, 20.