Case of Under Armour (1140 words)

Complete the following questions on the "Under Armour’s Strategy in 2014: Potent Enough to Win Market Share from Nike and Adidas?" case:

1. Complete a Porters Five Forces for the company/industry.
2. Complete a SWOT for the company. Please only list the top three strengths, weaknesses, opportunities and threats.

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Porter’s five forces analysis

Under Armour is a growing player in the multi-segment market of sports apparel and athletic wear. This industry is a growing industry as the industry is expected to grow at the rate of 4% per annum to have a size of $178 billion by 2019. Porter’ five forces analysis has been conducted to assess the competitiveness of the industry.

The bargaining power of consumers is very high in this industry since the switching costs of buyers are very low. Since there are many competitors such as Nike, Adidas, etc. consumers have the option to move to another brand if they do not find the products comfortable. Value offerings are very important since the consumers can easily shift to other brands. In case of Under Armour, the bargaining power of consumers is high since about 22% of the sales are generated by the two retailers Dick’s Sporting Goods and The Sports Authority. Due to the over-dependence on these two retailers for distribution, they can command premium margins for distribution and this can put Under Armour at a disadvantage.

The threat from substitutes is also moderate. This is because sports apparel and footwear is very important for performing well in sports. If the consumer opts to use non-sports apparel and footwear, they may find themselves at a disadvantage. Thus there is no direct competition to the players in this industry...