What once started as a trend word for the future has been embodied full force by Nike this year. Just in time for their sponsorship of the 2020 olympics, Nike is focusing its sustainability efforts on their new line of athletic wear and sneakers. The collection of recycled fashion is a part of Nike’s move to zero mission, earning itself a 90 percent mark of efficiency for its reuse of materials and reduction in harmful fossil fuels and wastage in manufacturing. What unveils in time for the summer may seem harmonious on the surface, but the evolution of Nike’s supply chain has been and continues to be a cornerstone in the brand's success. The impetus behind its supply chain outpacing UnderArmour’s can be narrowed down to one simple strategy - listening to what the customer wants.
Slow and steady wins the race
Over the last few years, Nike has advanced its product line and brand image to the interest of younger consumers. They honed in on the athleisure trend and inclusivity movement all while adapting their supply chain to be a playbook for sustainability. Nike’s slow and steady process of tapping into the sustainable fashions market stretches back to product launches like the Air Max, a sneaker that replaces a section of materials with an air pocket. While marketed more for it’s performance enhancements over its eco-friendly design, this slow introduction enabled Nike to gather insights before expanding further into the eco-conscious space. Their most recent development of the Space Hippie, a shoe regarded for being made out of trash, exemplifies the thoughtfulness in research and development deployed when it comes to product planning.
Meanwhile, UnderArmour has remained loyal to their mission of servicing the athlete - a decision which at times has forced them to do too much too fast. They’ve been criticized for taking risks in rushed manufacturing of athletic goods without expertly backed designs, compromising both safety and performance. Coupled with a lack of strategy for their pricey tech acquisitions and rejection of the athleisure trend, proper planning has struggled to be the backbone for this runner up.
Take for example founder and former CEO Kevin Plank’s direction on the Curry shoe. After a successful launch caused rapid sell-through of the first edition, Plank impulsively wanted to double down on the Curry 2 and increase bets on the Curry 3. Against the opinions of more critical employees, UnderArmour firmly doubled its inventory position only to watch sales flop and the inventory of these shoes make its way to clearance sections. While a relatively mild miss for UnderArmour, the risks associated with using instincts to drive inventory planning over consumer analysis of the market can be the demise of less established brands.
The finish line
Fortunately for UnderArmour, new CEO Patrik Frisk has implemented tighter controls on product planning, an effort which has already generated healthier margins for the brand. For UnderArmour, the next challenge will be strategically increasing revenue while revitalizing the spark that once was. The question remains, will they do so by continuing to service the athlete and sell a dream, or will they take a page from Nike’s playbook, listening to the needs of the consumers and the planet.