Research March 2, 2015

Do Under Armour’s Acquisitions Signal a Shift in Activewear Strategy?

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Under Armour has made headlines in recent weeks by announcing the acquisition of two large mobile app platforms, MyFitnessPal and Endomondo, for a combined $560 million, representing 18% of its 2014 sales. The huge investment signals a strategic shift among the major Sportswear brands away from basic fitness tracking and wearable devices sales to a focus on community building through integrated content, social networking and mobile commerce.

Under Armour’s mobile app goes beyond just tracking fitness metrics and creates a proprietary, social network with an Instagram-like newsfeed, photo sharing, and the ability to like, comment or repost other users’ content.

The Under Armour platform is also unique in that it is device agnostic, unlike the closed Nike+ ecosystem, which gives Under Armour the potential to achieve much larger scale than the Nike platform—think Nike is to Apple as Under Armour is to Android. Whether or not it will be able to realize this potential remains to be seen.

For more insights on how sportswear brands are leveraging digital, download L2’s Digital IQ Index: Sportswear 2015 at L2inc.com.

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