Under Armour looks to brand building in growth reset | WARC | The Feed
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Under Armour looks to brand building in growth reset
Under Armour, the sports apparel and footwear company, is focusing on building brand consideration and engagement at the top of the sales funnel as part of proactive measures to protect the health of its brand and reset growth trajectory, according to company executives.
Why it matters
Under Armour has been bogged down by months of discounting as it seeks to clear a glut of inventory. This can be a challenging cycle to turn around, but the brand is making the right moves towards growth by investing in brand building, rethinking distribution, and focusing on a tighter target audience.
By the numbers
- Global revenue up 3% to US$1.6 billion for the quarter.
- Revenue in North America, the brand’s biggest market, declined by 2% – largely due to discounting because of too much inventory.
Growing the top of the market
“Our plan is to not shrink the bottom of the market, but grow the top of the market. We want to get bigger as an overall brand,” said COO Colin Browne on its recent Q3 2023 earnings call.
To do this, Under Armour is focusing on middle to top funnel activations to increase awareness, engagement and consideration. The brand’s e-commerce presence has also benefited from more investment.
“When we look at the way we resonate with consumers, when we look at the data, we see that from a consideration point of view, we have a huge opportunity out there,” Browne said.
“Our focus is more about trying to elevate the brand … [that’s] how we're spending our time and thinking through the product we're developing and the stories we're telling the consumer we're engaging with,” he explained. “The entire strategic evolution that we've got in place, and we're working through, will hopefully help us deliver against that.”
Getting out of the discounting spiral
To stop a glut of inventory and subsequent discounting from undermining its brands over the long term, Under Armour is making important moves to get its distribution strategy under control.
“We've walked away from quite a bit of undifferentiated retail at this moment in time and we have no intention of going back,” Browne said, which will help protect the core product so that it doesn’t slide again.
“We're also making sure we control our liquidation at an appropriate level as well. So from the point of view of not allowing [the brand] to slide further into that trap, we're working aggressively to make sure that doesn't happen,” the COO added.
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