Loading summary
Transcript23 lines
- [00:00]
Kevin Plank
Audible subscribers can listen to all episodes of Business wars ad free right now. Join Audible today by downloading the Audible app. It's late 2014 in Baltimore, Maryland. Under Armour CEO Kevin Plank rubs his hands over his face and and leans back in his chair. He's been in his office for hours with two of his top advisors debating a decision that could redefine the company's future, and he's exhausted. He stands up and walks over to a whiteboard covered with notes, then picks up an eraser and wipes it clean. I just keep coming back to the same question. Does this move serve our core business? Planck uncaps a marker and draws a line to form two columns on the board. At the top of one column he writes buy. On the other, don't buy. Ok, let's go over it all again, starting with the pros. So why should we buy these apps? Under Armour is considering acquiring two different Fitness tracking apps MyFitnessPal, which tracks users calorie intake and exercise, and Indomondo, which offers virtual fitness training. The move would be a continuation of Under Armour's existing push into fitness tracking and an area where they're already playing catch up. Nike launched its own tracking platform, Nike, in 2006 and already has over 20 million users. It's also invested heavily in wearable technology like the Fuel band, which tracks data and connects users via the Nike ecosystem. A year earlier, in 2013, Under Armour bought MapMyFitness for $150 million, gaining access to its 20 million registered users. It was their first ever acquisition and a big step into unfamiliar territory. But now they're considering an even bolder move, buying two apps for $560 million. That's more than 15% of their annual revenue. The younger of the two executives stands up and takes the marker from Planck Under Buy. He writes, product development. From my perspective, this is a major reason to make this investment. Buying these apps will give us Data on roughly 100 million users. We'll know exactly how people exercise, when they exercise, where they exercise, and all this data will drive significant product innovation. The older executive shrugs. He takes the marker and writes, no concrete path to revenue under the don't buy column. I'm not Saying data isn't a plus, but we're talking about spending roughly $6 per user. That's a lot of money if we can't convert it into actual product sales. The younger executive snatches the marker back and writes, targeted sales. Under buy, we can do targeted ads. If data shows that a person is running in winter, we'll send them ads for our winter running line. Not to mention, these apps are popular with women. Over half their users are female. That's a customer base with real growth potential for us. Plank nods thoughtfully. He has a point, sure. But all of this is going to take labor. Innovation. Are we going to spend more mining the data than we ever will earn from it? I mean, Nike thinks the data is worth it. They have a whole suite of fitness apps. Do we really want them collecting all this consumer data while we just sit on the sidelines? Planck leans back in his chair. Spending more than $500 million on apps? That's a big risk and another step away from their bread and butter of selling apparel. But he firmly believes that data is the future, even if he's not totally sure how it's the future. He stands up, takes the marker, and he circles by. We're doing it. But for a split second, his eyes linger on don't buy, and he has a glimmer of doubt. He's chasing Nike. But are they already too far ahead?
- [04:24]
Narrator/Host (David Brown)
Being a serious business owner takes hard work, patience, and a drive to keep moving forward. So it's important to find a serious business card that goes the extra mile. With the VentureX business card from Capital One, you earn unlimited double miles on every purchase. And with big purchasing power, you can spend more and earn more. This is your sign to take your business to the next level. The Capital One VentureX business card. What's in your wallet? Terms apply seecapitalone.com for details. Adobe Acrobat your team's home base. Collaborate within a shared PDF space.
- [04:58]
Kevin Plank
You've got your docs, your plans, your specs, and then invite the crew to build. What's next?
- [05:03]
Narrator/Host (David Brown)
Talk of the teamwork? Here's an updated render.
- [05:05]
Kevin Plank
They think that this design could be a contender when somebody wonders what's the next step? Helps you finish the rest. Bolts are tight now.
- [05:15]
Narrator/Host (David Brown)
Your plan's refined. Run a smoother business when you're all aligned.
- [05:19]
Kevin Plank
Do that with Acrobat. Learn more@adobe.com Dothatwith acrobat from Audible Originals I'm David Brown, and this is Business Wars. In 1996, University of Maryland football player Kevin Plank founded Under Armour, pioneering performance wear designed to wick away sweat and boost athletic performance. Over the next two decades, the company expanded its product line and built a dedicated customer base among athletes who saw the brand as gritty and authentic. By 2015, Under Armour had become the second largest sports apparel company in the United States. Only Nike was ahead of it. Now Plank is determined not just to compete, but to surpass the industry giant in both technology and retail sales. But in its quest to take on Nike, Under Armour is at risk of drifting away from what may it successful in the first place. This is Episode two Dropping the ball. In early 2015, Under Armour buys MyFitnessPal and Indomondo for over $550 million. The company hopes the data they gather from these apps will help them target ads and drive product innovation, but they also see it as part of a larger transformation. Under Armour doesn't just want to be an apparel company, it also wants to be a tech company. The company's putting all of its eggs into the wearable tech basket so that eventually their shirts, shoes and other products will collect fitness data and help wearers track their performance and overall health. But developing this kind of technology is a large and costly undertaking. And while this vision takes shape, Under Armour is counting on a major revenue driver. Steph Curry's signature shoe line. It's 2015 near Portland, Oregon. Under Armour senior director Aaron Miller lies flat on a surfboard, rising and falling with a swell. The ocean is cold and the sky is still gray, but out here he can finally think. Miller is a relatively new hire at Under Armour. He joined the company a year and a half ago after spending the previous 18 years with Nike. When Under Armour hired him as senior director of footwear, he was excited to help the younger company grow. But as he plays back the conversation he had earlier that day, he feels like he made a mistake coming here. The company is preparing to launch the Curry 2, the second edition of Golden State warriors star Steph Curry's signature shoe, later this year. The first edition sold out quickly, so Under Armour wants to capitalize on the hype and manufacture even more units of the Curry 2. Generally, Miller agrees with this choice, but Under Armour executives want to produce a lot more six times as many Curry 2s as Curry ones, and Miller thinks that's way too many too soon. He doesn't think there's enough demand for that many shoes. The overstock will end up getting sold at a deep discount, and in the long term, this over saturation could hurt demand for future editions of the shoe. Miller believes the way to create a brand with lasting cachet is to keep consumers wanting more. You have to make the shoe rare so the resellers are hyped to find and sell the shoe. Miller has explained this to his colleagues repeatedly. This kind of expertise is why he was hired away from Nike, but he feels like everything he says falls on deaf ears, the executives say they just feel it in their gut that they should produce more. Over the past year and a half, Miller has learned just how much Under Armour executives base their decisions on gut feelings and how loyal they are to each other. Many of the top level executives go back to the earliest days of the company. It feels like a club Miller can't break into. He catches another wave and pops up on his board, holding steady for a few seconds, carving against the swell. For a brief moment, everything feels aligned. Then the wave loses shape and he slows, wobbling before dropping back into the water. That's the thing about waves. You can't force them to be bigger than they are. And that's how it feels. At Under Armour, Miller often feels like he's paddling against a current that won't change direction. As he catches his breath, he comes to a realization. He doesn't want to work there anymore. He's tired of fighting battles he can't win. The company is obsessed with growth, but they're ignoring the people who can help them achieve it. Miller exhales before paddling out again. He's had enough. Under Armour can figure out their shoe strategy without him. When the Curry 2 launches in October 2015, production numbers are indeed significantly higher than the Curry 1. Although Under Armour doesn't release the exact number. And just as Aaron Miller predicted, inventory piles up and the shoes hit the discount table. It's not a great look for a brand trying to create the next cultural touchstone, the new Air Jordans. Then, in mid-2016, Under Armour releases a low top version of the Curry 2. The all white design is quickly roasted online for looking like a dad's shoe, something a senior citizen might wear. Twitter users unleash their best jokes. What's your best name for these new Steph Curry shuffleboard lows? Hi, Under Armour. Did you steal these from my grandma? Do the new Steph Curry Under Armour shoes come with a pack of Werther's Hard candies? You get the idea. The message is loud and clear. This is not a hip shoe. But despite the mockery, the low top sells well within a month of hitting the market, they sell out online. It's a victory for Under Armour, but it also speaks to the confusion around what the brand stands for. In the early days, Under Armour's identity was clear. They made apparel that boosted performance. The brand promised that whatever your level of fitness, if you wore Under Armour's products, you would be a better athlete. But the reaction to The Low Top Curry 2 centers around its appearance, not its functionality. Still, Under Armour isn't concerned with this shift in the conversation. They're going full speed ahead to catch up to Nike, and they've decided to go back to their roots in 2016. When UCLA's contract is up with Adidas and the school puts out a call for bids, Under Armour is determined to win. Not only will it help the company keep expanding into the college market, it will give Under Armour a firmer toehold on the west coast, where Nike currently has the advantage given that their headquarters are in Oregon. Under Armour signs a record breaking deal estimated to be worth $280 million. Under the terms of the agreement, the company will provide shoes and apparel to UCLA's athletes for 15 years. But around the same time, in May 2016, just as under Armour feels like it's flying high, it faces a major setback. The retailer Sports Authority announces plans to close all of its 450 stores. At its heyday, Sports Authority was the largest sporting goods chain in the country, but it struggled in recent years and took on heavy debt. They faced increased competition from rival Dick's Sporting Goods as well as from online shopping. These factors finally proved too much for the chain. It's a big blow to Under Armour. The company had expected to generate $163 million in sales through Sports Authority for the remainder of the year. Now they'll have to slash these estimates. And the timing couldn't be worse. Under Armour has increased its spending over the past year as it works to develop wearable technology and expand its digital presence. The company's projected net income for 2016 is already nearly half what it was in 2015, and now it's about to take another major hit. Under Armour needs to find a way to replace the sales they're losing from Sports Authority, and quickly. Even disciplined companies can make poor decisions under pressure, and Under Armour is about to make a major fumble.
- [15:07]
Narrator/Host (David Brown)
Foreign.
- [15:12]
Indira Varma
This is a message from sponsor Intuit. TurboTax tax deadline looming, and you're stuck in the dark. We've all been there. Sending documents to a tax pro, then playing the waiting game, constantly checking for updates that seem to never come. Soon enough, TurboTax changes that match with a TurboTax full service expert and get unlimited support on your taxes at no extra cost. Even during evenings and weekends throughout tax season. Simply upload your documents and watch your return progress in real time while you focus on what matters to you. TurboTax experts work to maximize your refund, ensuring you get every dollar you deserve. No more chasing updates or wondering if Everything's on track with TurboTax Expert full service. You'll have the confidence of knowing exactly where your taxes stand every step of the way. Real time Updates only in iOS mobile app. Now this is taxes intuit TurboTax. Visit TurboTax.com to match with your expert today.
- [16:11]
Narrator/Host (David Brown)
I'm Indira Varma and in the latest season of the Spy who we open the file on Larry Chin, the spy who outplayed Nixon. For decades, Chin was embedded deep inside US Intelligence. Then comes an opportunity. Richard Nixon's secret plan to reopen relations with China. Information Chin can place directly into Mao's hands. But the CIA has a weapon of their own. A Chinese mole ready to defect. How long until Chin's gig is up? Follow the Spy who now wherever you listen to podcasts.
- [17:00]
Kevin Plank
It's mid-2016 in Baltimore, Maryland Under Armour CEO Kevin Plank sits at the head of a conference table surrounded by his top executives. Plank has called an emergency meeting following the news that Sports Authority has declared bankruptcy and is liquidating. The team needs to come up with a way to replace those sales. They've landed on a potential solution, but it comes with risks. Plank takes a sip of coffee, then folds his hands together in front of him. Look, I know this is a different kind of partner than we've historically worked with, but a deal with Kohl's has a lot of upsides, and maybe it's time to try something different. Historically, Under Armour's retail partners have been sporting goods stores, places that cater to their primary consumer base, recreational athletes and fitness buffs. But Kohl's is a big box department store known for selling a broad assortment of clothing and accessories and for its aggressive discounting. At the far end of the table, a younger executive nods his head. Yeah, Kohl's will help us reach women. That's a market we've been struggling to grow in for a long time. I think it's a good move. But across from him, another executive leans forward. Yeah, but at what cost? Dick's Sporting Goods is our biggest retailer. If we move into Kohl's and they start undercutting prices, we risk damaging that relationship. Plank nods slowly. I hear you. I value our relationship with Dick's, and I don't want to jeopardize that either. We're going to have to be careful. We need to be strategic about what products we sell through Kohl's so we don't eat into sales. At Dick's, we've been talking about developing a more casual line of clothing, something that can, you know, compete in the new Athleisure space. A partnership with Kohl's could help that line reach the right market, don't you think? But the other executive still isn't sold. Sure, maybe down the line, a partnership with Kohl's makes sense. But right now, do we really have enough product differentiation to avoid overlap, or are we just inviting price competition? Come on. Look, Kohl's really wants more athletic wear. They want this. We want this. We can make this work. The older executive turns to Plank. Kevin, it's your decision. What do you want to do? Plank looks between the two executives. Well, I think it's worth the risk. But Nike and Adidas sell at both Kohl's and Dick's. They've figured out how to manage it. So can we. In July 2016, Under Armour announces its partnership with Kohl's and the plan to start selling their clothes there in early 2017. The company frames the decision as an evolution, a massive opportunity to reach new consumers. And you know what? In the short term, it might be. But here's the tightrope. Distribution builds revenue, but it can dilute identity. When you expand into a discount heavy channel, you're not just adding shelf space. In a way, you're signaling to consumers what your product is worth. Retail partners notice, customers notice. And once shoppers get trained to wait for 30% off, good luck retraining them. Opening more doors sounds good for growth until you realize you may have just opened the wrong doors. Under Armour continues to expand aggressively. In 2016, the company signs a lease to occupy the former FAO Schwartz building on Fifth Avenue in Manhattan. It'll turn the 53,000 square foot building into a flagship store. The company also invests in developing a casual women's line to entice female shoppers and compete with athleisure giant Lululemon, a brand that was founded just a few years after Under Armour and has been growing rapidly by expanding beyond yoga pants and into a broader range of sportswear, including a men's line. Under Armour hopes that its Curry 3 shoe release will offset all this spending. The company's optimistic that demand will be high and help buoy revenue. In fall 2016, the Curry 3 launches at $140, $10 higher than the Curry 2. But the shoe struggles. The CEO of Footlocker tells reporters that the shoe is selling much slower than past editions, and Under Armour's market value tumbles by roughly $600 million. Sales of the Curry 3 never pick up. Retail partners heavily discount the shoe, but there's still, inventory overload online, Under Armour reduces the price by almost 30%. To outsiders, the move reeks of desperation. Under Armour blames a softening market for signature shoes. But others, including former Nike employee Aaron Miller, believe this is the long tale of over saturating the market. With Curry 2s, it's exactly what he warned would happen. And now, by having to heavily discount the Curry 3, Under Armour is damaging the brand. You know, scarcity isn't just a sneaker head trick. It's oxygen for any brand that's trying to play it cool. When you flood the market, you don't just lower prices, you lower mystique. Growth feels good in the moment. Six times the inventory looks like six times the ambition. But the problem is brand equity compounds slowly and can evaporate fast if your logo ends up on the discount rack. Customers don't forget easily. Sometimes the hardest thing in business isn't scaling up, it's holding back. Between the spending spree and the disappointing sales, Under Armour's 2016 revenue falls short of expectations. After 26 consecutive quarters of at least 20% growth, their fourth quarter growth falls to 12%. The one bright spot in their 2016 report is their partnership with Kohl's. Early sales are strong, but the long term effects are just beginning. It's mid-2017 in Coraopolis, Pennsylvania. Dick's Sporting Goods CEO Edward Staat paces his office fuming. He's just gotten the sales numbers for the last quarter, and sales of Under Armour are down across the board. He knows why. To find the answer, all he has to do is walk into the Coles in Robinson Township, five miles away. There he'll see an array of Under Armour products, all marketed at a steep discount. Sure, there are some products that Dick's doesn't carry, but Stack bets over half for products that Dick's does carry. And why would a consumer come over to Dick's and pay full price when they can get it for significantly less? At Kohl's, Stack picks up a stress ball from his desk and gives it a tight squeeze. The only way he'll be able to compete is to lower prices himself, maybe even offer price matching. But ultimately, that just means Dix is going to lose revenue, all because Under Armour decided to partner with Kohl's. The most galling part is that he's not convinced this is the right move for Under Armour. Maybe the deal with Kohl's will buoy the company's sales for a few quarters, but in the long run, this partnership will hurt Under Armour. He's certain of it. Stack isn't looking forward to telling Dick's investors that their revenue is down due to increased discounting by competitors, but he has a plan to recapture those sales. Dick's has been developing their own line of in house sportswear. At this point, it makes sense to devote more square footage to their own products and less to Under Armour. There was a time when he would have felt bad about this decision, especially given his close relationship with Kevin Plank. But not anymore. Under Armour has made it clear that it's every company for itself. We all know that saying, right? It's just business, nothing personal, as if the other guy's not going to feel it. True, retail isn't sentimental, but don't kid yourself. If there's anything we've learned on business wars, it's this business is built on relationships. Remember the handshake deal that turned Sriracha into a household name? When things broke down between the owner and the supplier of the peppers, the whole brand almost lost it all. See, the moment you weaken your partner's economics, you're inviting them to become your competitor. And sometimes worse. In response to slowing growth, Under Armour makes a number of leadership changes. The most significant move is hiring retail veteran Patrick Frisk to serve as president and chief operating officer. Frisk formerly worked for VF Corporation, overseeing brands like the North Face. Under Armour hopes that Frisk's three decades of experience and outsiders perspective will help Under Armour recapture the magic and reposition the company as a true challenger to Nike. But in summer 2018, another crisis hits. Under Armour gets word that Steph Curry is considering leaving. Even though sales for the Curry Three were soft, Curry is still hugely important to the brand. He's the main driver of the company's footwear business, generating an estimated several hundred million dollars of revenue in fiscal year 2017 and lending the brand cultural legitimacy too. Curry is a superstar, considered One of the NBA's most marketable athletes, known for reigning threes from anywhere on the court. He's won three championships with the Warriors. It would be a real blow to Under Armour's image if he left. So Plank and Frisk fly across the country to convince him to stay. It's summer 2018 in Northern California. After a cross country flight from Baltimore, Under Armour CEO Kevin Plank steps into a car alongside the company's coo, Patrick Frisk. The car winds through quiet suburban streets before taking them to their final destination, a meeting with their most important athlete, Steph Curry. When Plank and Frisk arrive, Curry and his agent are waiting for them. After some small talk, Plank gets down to business. He wants to clear the air. He knows there's tension between Under Armour and Curry. He's here to reset and talk honestly about where things stand. Curry doesn't hesitate. He says he's disappointed with the Curry 3 sales. It seems like the first two versions of the shoe had spark, but now the excitement is gone. The releases don't feel culturally relevant. When a new shoe drops, it doesn't dominate the conversation the way it used to. It's embarrassing. Plank nods his head. Curry's not wrong. The shoe hasn't performed as well as Plank had hoped either. But privately he believes responsibility runs both ways. Curry hasn't entirely held up his end of the bargain either. He hasn't always championed the brand as visibly as Under Armour would like, rarely wearing Under Armour apparel to his games. But Plank can't say that he's here to woo Curry, to stay, not litigate blame. He tells Curry they're also disappointed in the sales of the Curry 3. It didn't work. And they're open to ideas from Curry about how they can strengthen their partnership. Curry looks Plank directly in the eye. He tells him that when Under Armour signed him, they told him he would be the Michael Jordan to their Nike. But Jordan didn't just get a signature shoe line. He got an empire. That's what Curry wants. He wants a true Curry brand, including his own line of apparel. And not just basketball apparel. Curry is a passionate amateur golfer, frequently competing in celebrity golf tournaments. So he also wants a line of golf apparel. He wants a business built around him. Plank and Frisk had a feeling that's what Curry would ask for. But internally, the math is complicated. Curry's shoe isn't performing as they'd hoped. And now he wants an entire business built around him, including an apparel line for a sport he doesn't even play professionally. Still, losing Steph Curry would be worse. Even when the company is underperforming, Curry's shoes bring in a significant stream of revenue. And the optics of his departure, well, that would telegraph that Under Armour is in a slump. There's a long pause, and then Plank sticks out his hand. Curry has a deal. Retaining Curry buys Under Armour. Time. But the reprieve is short lived. In the fall of 2018, in the midst of the broader MeToo reckoning, Under Armour's corporate culture comes under fire. Female employees tell stories of a boys club atmosphere and say that female employees are invited to an annual company event based on their attractiveness, a practice that Some referred to as, quote, stocking the pond. They also allege that Under Armour executives frequently entertained athletes at strip clubs using corporate credit cards. Under Armour sends out an email banning the use of company money to pay for adult entertainment. Soon after, questions are raised about Plank's relationship with an MSNBC anchor. Both of them are married to other people, but according to media reports, they've grown close. Employees say she frequently traveled on the corporate jet with Plank and advised on company strategy over executives objections. Planck insists that the relationship is above board and that company resources have not been used inappropriately. Then in 2019, news breaks that the securities and Exchange Commission is investigating the company's accounting practices. There are accusations that Under Armour shifted its earnings to make it look like the company was in better financial shape. To cap it all off, Under Armour's growth stalls to just 1% in 2019. In the fall of 2019, plank surprises everyone and announces that he is stepping down as CEO of the company he founded in his grandmother's townhouse. President and COO Patrick Frisk will take over as CEO, while Planck will stay on as chairman of the board. Planck says the decision to step back was his alone and that in his new role, he'll have more time to think about the long term strategy. But after more than two decades as the face and force of Under Armour, it's a seismic shift for the company. Now, for the first time, someone else will try to guide it forward. And the question hanging over the company is no longer how fast it can grow. It's whether it can rediscover who it really is. It's early 2020 in Baltimore, Maryland. An Under Armour executive makes his way into a large auditorium at company headquarters. It's the first all hands meeting led by new CEO Patrick Frisk. The room is already almost full and the executive has to squeeze into one of the last seats. Everyone is eager to hear what Frisk has to say about his vision for the company. Even though Frisk has worked for Under Armour for over two years and is the natural successor, it still feels strange that he's the CEO. The executive could never imagine Plank stepping down, but the company has been struggling the past few years and this executive is hopeful that Frisk will be able to stop the slide. After a few moments, Frisk walks onto the stage. He takes the mic and thanks everyone for coming. He acknowledges that this is a big change for the company and that no one could ever fill Plank shoes. He also acknowledges that some big changes are coming. There's going to be some restructuring and they may need to say goodbye to some projects they were excited about, like that flagship store in New York City. But there are also some exciting changes. For one, the company is going to go on the offense when it comes to marketing. For the past few years, Under Armour has been relatively quiet. Not running major ad campaigns. It allowed its retailer partners to define the brand. But now they're going to boost their investment in marketing. They're going to make sure the brand is back on top of consumers minds. This also dovetails with another goal they want to boost direct to consumer sales. Under Armour E Commerce has been lagging. That's going to end. But Frisk says this won't all happen overnight. The watchword is slow and steady growth. The executive exchanges a look with his seat neighbor. Most of what Frisk has said was expected, but Under Armour has been obsessed with aggressive growth for as long as this executive has worked there. Plank's motto for the company was get big fast. The executive isn't sure that the company can shift its corporate culture so quickly. And Planck is still the chairman of the board. Is he going to have the patience to watch Under Armour pursue sustainability, not fast growth? He's not so sure. He has a feeling that Frisk may not last long in this new role. Patrick Frisk barely has the time to implement his plans for the company before the whole world shuts down in early 2020. The COVID 19 pandemic triggers widespread lockdowns. Brick and mortar stores still the biggest driver of Under Armour sales. Clothes gyms shut down. Organized sports grind to a halt. The company is forced to lay off 600 people. It cancels its record breaking apparel deal with UCLA and sells the MyFitnessPal app which it acquired in 2015. It also shuts down Indomondo, the other app it purchased at the time. Frisk tries to frame these changes as refocusing on the core business, but the company also needs the cash. And yet, despite the impact of COVID 19 over the next year, Frisk's plan for sustainable growth looks like it's working. By the third quarter of 2021, revenue is up 8%. It's not the 20 plus percent growth under Armour saw during its heyday, but it's a significant improvement from 1% in 2019. And the company sees major growth in direct to consumer sales. One of Frisk's focal points. E Commerce sales, boosted by changing shopping habits during lockdown, climbed to 50% of pre pandemic levels. This means more customers are paying full price for Under Armour products rather than buying them through discount stores like Kohl's and TJ Maxx. By all accounts, Frisk is doing what he set out to do, and analysts take notice. The company appears to be settling into something healthier, a more balanced mix of apparel and footwear, wholesale and direct sales. Which is why industry observers are surprised when, in the summer of 2022, Frisk announces he's stepping down just two years into his tenure. Neither Frisk nor Under Armour gives a detailed reason for Frisk's decision to leave, but his lucrative separation package fueled speculation that he was forced out. The leading theory is that founder and board chair Kevin Plank wants aggressive growth, not slow and steady growth. In particular, they theorize that Planck is frustrated that Lululemon's revenue surpassed Under Armours for the first time in 2021. Lululemon continues to dominate the athleisure market, a market that was tailor made for pandemic life and continues to grow. And even with vaccines becoming more widespread and Covid restrictions easing, people still want to look good when they leave the house without sacrificing the comfort they've grown accustomed to. But Under Armour has struggled to break into this market. Their more casual, less performance focused clothing never really caught on. The contrast between the two companies is stark. Under Armour is forecasting 5 to 7% revenue growth in 2022. Lululemon? Well, they're predicting revenue growth closer to 25%. Under Armour decides it's done with slow sustainable growth. It wants its swagger back and to reclaim its number two spot. And it wants to put Nike back in its sights. So in 2023, after an extensive search, Under Armour names Marriott president Stephanie Linartz as CEO. It's a surprising choice. Linartz doesn't have apparel experience. Her entire career has been spent in hospitality. But she is an avid runner and passionate football fan. And she understands loyalty ecosystems. Linartz lays out a three year plan to return Under Armour to its days of double digit growth. Some of it sounds familiar. Scale back sales through third party retailers, increase direct to consumer sales and sign flashy endorsement deals with colleges and high profile stars to build what she calls brand heat. She creates a rewards program similar to hotel loyalty programs to encourage customers to buy directly from Under Armour. And she starts developing a casual line of women's clothing and shoes to try to boost Under Armour's appeal with women. She hires fashion designer John Varvatos as chief design officer to elevate the brand's style credentials. But one year into the job, Under Armour's revenue growth slips and in spring 2024, Linarz steps down, presumably forced out. Replacing her will be Kevin Plank, resuming his place at the top, a place many argue he never really left. Planck promises once again to return Under Armour to to its former glory. But that's been Under Armour's goal for years, with little to show for it. So analysts are eager to hear his vision for how he's going to achieve this. It's December 2024. Kevin Plank walks into a meeting room in a hotel in New York City. Women's Wear Daily editor Jean Palmieri sits at the table, flipping through a notebook. Plank sticks out his hand. Sorry I'm late. Crazy day. Under Armour's in town for its annual investor conference, but he's made time for this interview with the influential fashion trade magazine. Pamieri shakes Plank's hand.
- [41:52]
Narrator/Host (David Brown)
Let's just jump in. I know you're pressed for time. So you're back and Under Armour is restructuring once again. This is the fourth restructuring since you started the business in 1996.
- [42:05]
Kevin Plank
It is, but the world moves fast and you have to evolve with it. And this time we know exactly who we are. Palmieri raises an eyebrow. Because that's been the question for years. Is Under Armour an elite performance brand or a discount store staple? Is it cool, casual, athleisure wear or a brand designed for a competitive edge on the field, not style? We're the underdog. I see us as a startup again and we need to get back to our roots.
- [42:38]
Narrator/Host (David Brown)
So returning to your origins as a high performance company.
- [42:42]
Kevin Plank
Exactly. We're making the decision to reduce our product line. That will ease customer confusion.
- [42:48]
Narrator/Host (David Brown)
And how are you deciding which products to keep?
- [42:52]
Kevin Plank
We're operating from a good, better, best philosophy. For the past several years, we've made a lot of good products and some better products, but not enough best. So we're gonna cull the good and increase the best.
- [43:05]
Narrator/Host (David Brown)
And these so called best products can be sold at a higher price point, I take it?
- [43:10]
Kevin Plank
Exactly. We're re establishing ourselves as a premium brand.
- [43:15]
Narrator/Host (David Brown)
I see. And when do you expect to see results from these changes?
- [43:20]
Kevin Plank
Well, that's not something I can put a timeline on, but we know it's not going to happen overnight. We're rebuilding ourselves with purpose and clarity and it'll take time for the market to respond. We just have to wait it out and stay the course. Pamieri writes patience down in her notes and underlines it. Patience has never been one of Planck's strengths, and she wonders if he'll have the willpower to see this new vision through. Or if in his desperation for fast growth, he'll change course again.
- [43:54]
Narrator/Host (David Brown)
Well, I wish you luck with it.
- [43:57]
Kevin Plank
Thank you. Appreciate that. You know what? This might be the hardest lesson in this entire story. Often strategy isn't the tough part. Sticking to it is. Most companies don't fail because they lack ideas. They fail because they keep changing them. Every pivot resets momentum, retrains customers, exhausts employees. But consistency that builds trust both out there in the market and inside the building discipline is a competitive advantage in its own right. Throughout 2025, Under Armour follows Planck's plan, reducing the number of products it sells and refocusing on high end performance Apparel. And in November 2025, it makes another major change. The company parts ways with Steph Curry. It's announced as a mutual decision. Under Armour will release Curry shoes through early 2026, and then Curry and the Curry brand will go their own way. Signing Curry was a major milestone for Under Armour, and this marks the end of an era. But at the time of his departure, Curry brand products were bringing in around $100 million in revenue, only 2% of Under Armour's total revenue. By comparison, Michael Jordan's brand is estimated to bring in close to $7 billion for Nike in early 2026. There are signs that Under Armour's new focus is working. In February, the company raises its forecast revenue for the year, but it's still a far cry from the 2000 and tens when Under Armour dominated the athletic wear field. And the lingering question persists. Can Kevin Plank stick to his new plan, or will he change course once again? Still, for now, Nike remains the undisputed king of sportswear. Follow Business wars on the Audible app or wherever you get your podcasts. You can listen to all episodes of Business wars ad free by joining Audible. From Audible Originals. This is Episode two of Under Armour's attack on Nike for Business Wars. A quick note about recreations you've been hearing in most cases, we can't know exactly what was said at the time. Those scenes are dramatizations, but they're based on research. And if you'd like to read more, we recommend How Under Armour Lost Its Edge by Julie Cresswell and Kevin Draper, published in the New York Times Magazine. Also Under Armour's Self Inflicted Wound by Miriam Gottfried, published in the Wall Street Journal and the Rise and Fall of Stephen Curry's Under Armour Partnership by Tim Newcombe, published in Forbes. We'll be talking with Tim in our next episode. I'm your host David Brown. Austin Rachlis wrote this story. Voice acting by Chloe Elmore. Our senior producers are Jenny Bloom and Emily Frost. Our producer is Tristan Donovan of Yellow Ant. Karen Lowe is our producer emeritus. Our managing producer is Desi Blalock. Fact checking by Gabrielle Drollet. Sound design by Kyle Randall Executive producer for Audible Jenny Lauer Beckman, Head of Creative Development at Audible Kate Navin, Head of Audible Originals North America Marshall Louie, Chief Content Officer Rachel Giazza Copyright 2026 by Audible Originals, LLC. Sound Recording Copyright 2026 by Audible Originates.