Analyzing Under Armour’s Segmentation Strategy

images

Hello Readers,

My next assignment transports us into the world of segmentation. This assignment looks at the segmentation strategies and targets that Under Armour chose for their 2014 campaign. You can find the Under Armour case study here.

Under Armour began its retail life producing sweat-wicking undershirts for football players. After only 16 years, the company expanded their product line and began advertising to the male market. In 2013, the founder, Kevin Plank, became fed up with the lack of sales within the female segment and continuing to rank third in the athletic wear market space (behind Adidas and Nike). He decided to launch a marketing campaign to try to appeal to this sector. In 2014 the company launched their “I Will What I Want” campaign. This campaign focused on the female segment and utilized social media and influential, strong, and relatable celebrities. The campaign was a success! It generated a 28% increase in sales and almost doubled traffic to the company’s website (Saghian & Murry, 2016).

Under Armour’s marketing team had to decide who and how they were going to target this marketing campaign.

After Adidas failed in creating a campaign to target the female segment, Plank was determined that his marketing team could do it more effectively. Plank was also driven by the lack of female apparel sales, only about 1/5 of the company’s total sales. These factors led to his decision to target the female segment (Saghian & Murry, 2016).

When deciding on segmentation strategies, there are four approaches a company can take, mass marketing or aggregation (a whole market), differentiated (some specific segments), niche (one segment), or mass customization (customizing products for the whole market) (Kardes, Cronley & Cline, 2012).

Under Armour decided to take a mass market approach as they crafted this campaign for the broad female market. The founder did, however, mention that the goal of this campaign was to “celebrate women who had the physical and mental strength to tune out the external pressures and turn inward and chart their own course” (Saghian & Murry, 2016, p. 2).

The case study also mentions additional segments the company could target such as those with an interest in health, fitness, weight-loss, and nutrition, those using technology in their workouts (such as apps and step counters), rock climbers, health club members, and “athleisure” wearers (wearing activewear outside of physical activities) (Saghian & Murry, 2016).

There are some additional factors that a company should remember when implementing segmentation strategies.

According to Brant Cruz and Jeff McKenna, the Vice President and Senior Consultant at Chadwick Martin Bailey, there are some specific best practices a company can follow when implementing segmentation strategies. These include starting with the end in mind, allowing multiple bases, having an open mind, anticipating trade-offs, leveraging existing resources, and creating a plan of action (2010).

Starting with the end in mind will help the company create their plan. They should figure out what their ultimate goal is going to be for this segment. Further, the company should consider many bases when crafting this plan such as segment characteristics, behaviors, preferences, perceived brand value, brand awareness, product availability, and choice. When anticipating trade-offs, the company should consider the defined targets, the marketing strategy, and the accuracy of the different segmenting solutions (Cruz & McKenna, 2010).

Finally, we were asked to suggest a new segment that could be profitable for Under Armour to pursue. My recommendation is based on personal experience and observing these products in use. My recommended segment for Under Armour is the hunting/fishing market segment.

I come from a small town in rural Idaho and most of my friends and family hunt and fish. As the hunting season approaches, I see the need for a lightweight, under-layer that wicks sweat and regulates the body temperature of the wearer. Hunters/ fishermen usually need to hike into the area that they hope to find their game. They also usually begin their recreation during the early fall, when the temperatures can fluctuate greatly throughout the day. It is essential for the comfort of the wearer to have a lightweight, sweat-wicking, temperature-regulating layer under the rest of their gear. Therefore, I think the hunting and fishing segment could be an option for Under Armour to pursue.

My recommendations for a strategy to pursue this segment would be to first perform a SWOT analysis to make sure these segments align with the company’s strengths, weaknesses, and goals. Next, I would recommend the company use a differentiated segmenting strategy. Meaning that Under Armour targets both the fishing and hunting segments, specifically, males, ages 18-55, who live in more rural areas. The company could then work to align their marketing strategy with this potential segment (Kardes et al., 2012).

Do you think that these segments would be wise for Under Armour to explore?

 

 

 

Resources 

Cruz, B & McKenna, J. (2010). Segmentation best practices. Retrieved from https://www.slideshare.net/cmbinfo/segmentation-best-practices

Kardes, F., Cronley, M., & Cline, T. (2012). Consumer behavior (2nd ed.). Boston, MA: Cengage Learning.

Murry, M. & Saghian, M. (2016). Under Armour’s willful digital moves. Retrieved from http://store.darden.virginia.edu/under-armours-willful-digital-moves

Image Sourced From investopedia.com/content/short_article/is_under_armour_goin/under_armour.jpg

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s