NIKE, Inc. (NKE), Lululemon Athletica inc. (LULU): Under Armour Inc (UA) Takes on Two Companies With Recent Announcements

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Back in 1996, Kevin Plank founded Under Armour Inc (NYSE:UA) as a performance apparel company. Since that time, the company has continued to expand its product offerings to compete with other large athletic apparel companies. In 2006, the company launched its footwear category to take on NIKE, Inc. (NYSE:NKE), the longtime leader. In 2013, the company has taken two new initiatives to further its competitive edge and diversification.

NIKE, Inc. (NYSE:NKE)

Under Armour39

In a direct play against NIKE, Inc. (NYSE:NKE)’s success with the Nike+Fuelband, Under Armour Inc (NYSE:UA) has launched Armour39. Armour39 is the “first of its kind performance monitoring system for athletes.” The device monitors calories, steps taken, and captures every heartbeat. The device uses Willpower, the first true measure of an athlete on a 0.0 to 10.0 scale. The Armour39 is a device that is strapped to your chest, which is currently priced at $149.99. An additional display watch can be purchased for around $200. That item has sold well and is currently out of stock on Under Armour’s website.

NIKE, Inc. (NYSE:NKE) launched the Fuelband in February of 2012. The device tracks steps, calories, and physical activity. Users of the Fuelband can track their results at the Nike+ online community. Strong demand for the product carried the equipment division of Nike in fiscal 2012. That unit saw 18% higher profits, despite the device being sold out on the company’s website several times.

The Armour39 is a big opportunity for Under Armour Inc (NYSE:UA). With a strong presence in the apparel market, Under Armour needs to make a splash in other categories. NIKE, Inc. (NYSE:NKE) has long been the market leader in footwear and has boosted its sales and transformed its Nike Running category with the Fuelband. With the technology we have available in the world, customers continue to look for products with a social and technology aspect. Even though Under Armour is not first to the punch, it can make a splash in the growing athletic tracking market, which in turn can boost sales of other products.

New stores for women

In another exciting growth move, Under Armour is taking on Lululemon Athletica inc. (NASDAQ:LULU). Under Armour Brand House is the first stand-alone Under Armour store to open since 2008 in the United States. The store, in Baltimore, is testing a new store layout that caters more to women than before. The company has ditched its typical locker room men’s performance clothing design. The new store has lighter colors, more open space, and has ten times the number of mannequins in a typical store.

The store will heavily promote Studio and ArmourBra, two recent offerings in the women’s clothing segment. Studio is Under Armour Inc (NYSE:UA)’s take on yoga apparel, which will directly compete with Lululemon Athletica inc. (NASDAQ:LULU). ArmourBra is the company’s expansion past the sports bra into everyday clothing. The store will also offer promotions like “Workout Wednesdays”, which will award customers with free yoga at local studios with apparel purchases.

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