Hello
Welcome to our Under Armour Blog, In this blog, we will be looking at The
marketing Environment of Under Armour and how it affects the company.
So what is The Marketing Environment, Its stated that “…the
actors and forces that affect a company’s capability to operate effectively in
providing products and services to its customers” (p.73)
Jobber
(2010)
-“…the
actors and forces that affect marketing management’s ability to build and
maintain successful relationships with target customers” (p.76)
Armstrong
et al (2012)
The Macro Environment what is it, The surroundings
where the corporation operates is called the micro-environment. The
macro-environment refers to the general surroundings that could have an effect
on the operations of all businesses.
When
we are looking to go into the Macro environment of a business the best tool to
use is PESTEL Analysis, which allows us to analyse the direct impacts it has on
the industry. The programme lets the organisation adapt and mould its present
plans to meet the changing times by carefully judging these elements.
Political, Economical, Social, Technological, Environmental, and Legal Aspects
of the PESTEL analysis methodology are included. After examining these factors,
the tools analyse the company's present plans and highlight its strengths and
flaws.
About Under Armour: Under Armour, founded in
1996 by former University of Maryland football player Kevin Plank, is the
pioneer of performance wear, which is designed to keep players cool, dry, and
light during a game, practise, or workout.
Political Factors
Political
issues impose external restraints on a company and its operations that are
normally beyond the company's control. Legislation and rules that either force
or restrict a corporation from taking particular actions are examples of
typical political factors. It assesses how local and national governments
affect the economics of various businesses. As a result, it has an impact on
corporate growth and expansion.
-Flexible
government regulations appear to be an advantage for industrial enterprises
like this. However, in nations like India and Bangladesh, where labour rules
are severe, the political component could be an issue.
-Currency
fluctuations, currency rates, taxes, customs fees, and other factors obstruct
the company's global expansion. For example, About 60 per cent of Under
Armour's output is produced in 15 countries, the majority of which are China
and Vietnam. Federal subsidies, inexpensive labour, and a designated special
economic zone in China assisted the company in dramatically lowering its
expenses and exporting its goods to the rest of the world.
Economical Factors
Economic
factors are underlying economic or market statistics that influence business
performance. Economic growth, exchange rates, inflation, unemployment, consumer
purchasing power, and other factors all have a direct impact on profits. All of
these elements are classified as economic.
-During
the projection period, the global apparel industry is expected to grow at a
rate of 5.5% (2020-2025). It gives up a multitude of opportunities for Under
Armour to expand its operations into rapidly growing Asian and Middle Eastern
countries But due to the labour cost increases in China It becomes more
difficult for the corporation to supply low-cost products to its clients.
-The
brand has gone through a hard time due to the pandemic restrictions because
sporting activities were cancelled and gyms were closed leading to consumers not
buying their products, therefore, leading to a decrease Year over year, revenue
dropped by 23%, from $1.2 billion to $930.2 million.
Social Factors
It
refers to the social/cultural elements that shape and mould the preferences and
wants of customers. In any sector, demographics, population growth, career
attitudes, and social conventions all have a part in determining need and
distribution channels.
-Due
to the company being widely favoured by its consumers it shows us how the
company has established itself as being a unique brand that offers high-quality
goods at reasonable prices. Which works in the company's favour.
-Due
to technology improving people want to have clothing fabric that absorbs sweat
and moisture Under Armour must continually adapt to changing consumer tastes by
removing sweat from the body and using antimicrobial textiles. At the same
time, the apparel must be appealing and fashionable not only for sports but
also for everyday use.
-When
it comes to attracting new customers Under Armour decided to partner up with
Dwayne Johnson and due to this partnership, it has brought in new customers
which is appealing to the mass.
Technological Factors
Production
techniques, information and communication resources, production, logistics,
marketing, and e-commerce technology are all technological elements. These have
an impact on how businesses operate, sells their products, communicates with
customers, suppliers, and competitors, and gathers intelligence on them.
-Since
the Covid pandemic hit a lot of businesses have gone online and one of them is
Under Armour bringing their services online reaching a wider audience because
there are people who prefer to shop physically and there people who prefer to
shop online so they would need a balance.
-Nowadays
everyone has got themselves a mobile phone that has access to the internet
leading to them being active on social media and Under Armour has seen this,
therefore, leading them to be more active on their social media platforms such
as Facebook, Instagram and Tik Tok.
-
The firm has used technology to create unique items that have met the changing
preferences and want of customers.
Legal Factors
Legal
factors are external elements that describe how the law influences how firms
run and how customers act. Legal factors, like political factors, are made up
of laws and regulations. Consumer rights, health and safety, equal opportunity,
and other issues are among them. Legal considerations are critical,
particularly in global trade.
-In
2018 one of Under Armours' customers had posted on Facebook stating that their
clothes are flammable resulting in children getting burns and injuries. Once
this post was seen people started to doubt the quality of the products.
-Another
scandal that Under Armour was involved with was suing a company due to
trademark infringement but were later criticised due to the word Armour being a
common name.
Environmental Factors
Environmental
factors are significant because they can have direct and indirect influences on
business operations, people, and income. The external environment of a business
changes on a regular basis in ways that are beyond the company's control, but
executives and managers can keep track of these changes and mitigate their
effects.
-Under
Armour promises to be investing in environmentally friendly and long-lasting
techniques. It will assist them in reducing their environmental impact. Under
Armour has also teamed up with a number of non-profit organisations to promote
environmental awareness.
-Under
Armour Stretch needs to know how concerned consumers are about environmental
issues. It will aid Armour Extend in designing environmentally friendly
products as well as avoiding public relations setbacks.
-Under Armour's social responsibility strategy focuses on long-term sustainability. Their goal is to stretch a dollar as far as possible by being more resource-efficient, reducing waste and lowering their carbon footprint.
References
Momin, A., 2021. 'Under Armour PESTLE Analysis
2021: Succumbing to the Competition', PESTLE Analysis, [online]. Available at:
https://pestleanalysis.com/under-armour-pestle-analysis/ (Accessed 19 June
2021).
Team, M., 2021. 'PESTLE Analysis | PESTEL
Analysis of Under Armour | MBA Skool-Study. Learn—share', MBA
Skool-Study.Learn.Share, [online]. Available at:
https://www.mbaskool.com/pestle-analysis/companies/18060-under-armour.html
(Accessed 19 June 2021).
Baines, P., Fill, C. and Page, K. (2012)
Essentials of Marketing OUP
Dibb, S., Simkin, L., Pride, W.M. and Ferrel,
O.C. (2012) Marketing Concepts and Strategies, Cengage Learning EMEA, 6th
Edition
Fahy, J. and Jobber, D. (2012) Foundations of
Marketing, McGraw-Hill Higher Education,
4th Edition
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