Brand Wars: Nike vs. Under Armour

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1 BRAND WARS LEVERAGING OPEN ENDS TO UNCOVER WHO WILL WIN + WHY

Transcript of Brand Wars: Nike vs. Under Armour

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BRAND WARS LEVERAGING OPEN ENDS TO UNCOVER WHO WILL WIN + WHY

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BRAND WARS. We love a good competition. And we believe that a key ingredient in a good

competition is a clear winner, no matter how close the battle. So we pinned

two industry leaders – Nike and Under Armour – against each other in a

good old fashioned head to head, and collected consumer intel on each

brand to understand who is the fan favorite and why.

Which athletic brand will come out on top in 2015? Read on to find out.

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THREE QUESTIONS.

TWO LEADERS.

ONE WINNER.

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BEHIND THE CURTAIN. We reached out to 1,000 consumers to ask three questions about each

brand. We used ThoughtPath, our cognitive framework (rooted in three

theories of psychology), as our guide to carefully craft questions aimed at

cultivating the most insight regarding consumers’ perceptions of, and

relationship to, each brand. Once we collected the feedback, we

implemented (iM)merge Analytics to cull through the massive amount of

data quickly and accurately. From there, our analysts teased apart the

nuance in the verbatims to gain a deep understanding of how consumers

view and discuss each brand.

Let the games begin.

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PERCEPTION THEORY

How would you describe [Nike/Under

Armour] to someone who has never

heard of it before? Please give as much

detail as possible.

IDENTITY THEORY

How would you describe the type of

person that wears [Nike/Under Armour]?

Please give as much detail as possible.

EXPERIENCE THEORY

How does [Nike/Under Armour] motivate

you to live an active life? Please give as

much detail as possible.

THE QUESTIONS:

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FIRST GLANCE? TOSS UP. Consumers see Under Armour and Nike in a very similar light. They’re both

pricey, well-loved, athletically-minded sports brands. But we didn’t have to

ask consumers to know that, so we continued to dig below the surface.

With a little effort, a great deal of nuance emerges from consumers’

perceptions of two similar brands, illuminating clear differences in the way

that consumers view Nike and Under Armour.

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EXPENSIVE

POPULAR

SPORTS-FOCUSED

HIGH-QUALITY

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[spoiler alert]

ATHLETIC PEOPLE WEAR BOTH. When we asked what type of person wears each brand, at a surface level,

the perceptions of each brand’s loyalists are very similar. Consumers use

the same broad language to describe both. But, in understanding the

relationships between words and flushing out the context with which each

word is used, we learned that the same word can mean very different things

to consumers – even when discussing two seemingly similar brands. Even

when the terms used to describe each brand (in all caps) are identical, the

context in which the word is used (below each term) is very different.

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SPORTY

Energetic, healthy, fashionable, stylish

ATHLETIC

Cool, stylish, conscious, fashionable

FIT

Sporty crowd, comfortable, athlete

ACTIVE

Athletic, very, runner

SPORTS

Healthy, wealthy, fan, sneakers

SPORTY

Dudes, sweaty, football, runner

ATHLETIC

Tough, strong, attractive

ACTIVE

Athlete, outdoorsy, serious

SPORTS

Athletically minded, inclined, player

COMFORTABLE

Strong, shape, clean

WHAT TYPE OF PERSON WEARS [NIKE/UNDER ARMOUR]?

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NIKE = ATHLETIC SHOES. When describing Nike as a brand, shoes are top of mind. Boomers, more

so than millennials, associate the brand with athletic shoes. But Nike’s

athletic shoes aren’t your average shoe – consumers speak to the fact that

the comfort of Nike shoes is what gets them out of bed in the morning and

ready to hit the streets. It’s the way the brand motivates them most to live

an active life, more than even the famed inspirational commercials.

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Their shoes are comfortable enough

for you to want to go the extra mile.

– Female, 45-54

One of the best sneaker brands. Many

styles, colors, and types available.

– Female, 25-34

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EVERYONE NEEDS SNEAKERS. Consumers believe that Nike is a brand for everyone – they mentally leap

from the sentiment that Nike is synonymous with athletic shoes to the

thought that everyone needs athletic shoes, and therefore reason that

everyone could wear Nikes.

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CONSUMERS’ THOUGHT PROCESSES:

Nike is synonymous with sneakers

Everyone needs sneakers

Everyone could wear Nikes

Everybody – athletes, students, professionals,

moms, dads, grandparents, etc. It’s a shoe for

everyone!

– Female, 35-44

My son would say they have a lot of swag. I say

they have something for everyone.

– Female, 35-44

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NIKE WEARERS ARE LIKE ME. Consumers speak to Nike’s messaging and advertising as enforcers of the

“Nike is a brand for everyone” sentiment. Ads feature individuals who

consumers relate to and think look similar to themselves. Furthermore, the

advertisements’ compelling stories inspire and motivate, regardless of age

or athletic ability.

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CONSUMERS CAN PICTURE THEMSELVES

IN NIKES

“Nike ads show that no matter what you look like,

you can succeed at your goals.” – Male, 18-24

“JUST DO IT is the best line ever, I am over 60 and

still live by it.” – Female, 65+

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TRIPLE THREAT. By digging deeply into who consumers view as Nike-wearers, we found

three main points of entry, or three reasons that consumers turn to Nike:

practicality, performance, and fashion. From the recreational park-walker, to

the elite athlete, to the geek chic ad-exec, Nike covers a multitude of bases.

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3 MAIN ENTRY POINTS:

PRACTICALITY

PERFORMANCE FASHION

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AND NEITHER SNOW, NOR RAIN… When we look at how consumers describe Under Armour, they are quick to

point out all of the technical aspects that make Under Armour functional in

the most challenging of conditions. Aside from minimal mentions of price

and overall quality, consumers use language such as “wicking,” “skin-tight,”

“insulating,” and “breathable” to describe the brand. To consumers, Under

Armour’s key differentiators are woven into the fabric of their apparel (which

is fitting, as the brand’s original product was a moisture-wicking shirt).

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CLOTHING IS ALL ABOUT PERFORMANCE.

base layer

thermal

wicking

nylon breathable

skin-tight

insulating

elastic

light

protects

PERFORMANCE

An active individual who is serious about what they

do, and pushes their body to the limits but wants

and needs the best active gear available today.

–Male, 18-24

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NO EXCUSES. Athletes find that Under Armour’s most motivating quality is the

performance of the gear – if they can’t use their faulty apparel or equipment

as a crutch in bad weather, they have no excuse but to brave the elements.

With the right equipment, there’s no such thing as bad weather, and this

makes them feel unstoppable.

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Having equipment to withstand

unfavorable weather motivates you to

stay active even when Mother Nature

doesn’t.

– Male, 25-34

Just having the UA symbol on my

shirt motivates me. I don’t want to be

seen eating a burger and fries. I want

to be seen going through a grueling

workout or Tough Mudder event!

- Male, 35-44

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UNIVERSAL APPEAL IS LACKING. But not everyone is an elite athlete – or would even consider logging a few

miles in the snow. While Under Armour’s focus on performance pleases

athletes, it alienates a large sector of the population that either doesn’t care

about elite athletics or cannot relate to this degree of athleticism. When we

asked who wears Under Armour, we found that Under Armour wearers are

not your average athlete in both athleticism and attitude – consumers used

words like “cocky,” “trendy,” and “wealthy.” The super-human athleticism

can be off-putting, leading some consumers to be uninspired by the

perceived unattainable fitness level.

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Athletic, trendy, but unrelatable.

– Male, 18-24

Athletic, active, and probably attractive.

– Female, 65+

Intense athletes that are probably into

American football. – Male, 25-34

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NIKE HAS A BIGGER FOOTPRINT. So, by tapping into consumers perceptions of the brands overall, their

perceptions of who wears each brand, and their personal experiences with

each brand, we’re able to understand that there are three distinct, yet broad

reaching, points of entry for Nike, and only one for Under Armour.

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WHY BUY NIKE VS. UA?

PERFORMANCE

PRACTICALITY

FASHION

PERFORMANCE

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NIKE WINS OUT. Simply put, more people relate to, and can see themselves in, Nike. The

brand’s rich sneaker heritage contributes to the broad appeal, as does their

relevant and inspiring messaging. While sneakers are more top of mind for

Boomers, its clear that everyone, regardless of generation, is aware of Nike

and can imagine themselves donning the swoosh – and they often do.

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OUR WINNER?

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THE (FEROCIOUS) UNDERDOG. The fact that Under Armour is a threat to Nike is impressive in itself – just

nineteen years ago, the brand was a pipe dream in CEO Kevin Plank’s

grandmother’s basement. While Under Armour comes in behind Nike, the

brand has a great deal of momentum and opportunity. Millennials in

particular offer hope of closing the gap: they rave about Under Armour’s

comfort, and don’t say the same for Nike. Millennials and elite athletes

aside, there are many markets that Under Armour can tap to continue to

grow market share. The brand has already successfully kicked off this

outreach; they executed a wildly successful and award-winning “I Will What

I Want” campaign targeting women in 2014, and recently spent over $600

million purchasing two fitness apps, MyFitnessPal and Endomondo,

allowing them to help a diverse group achieve their exercise goals,

regardless of fitness level.

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THE

RUNNER

UP

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…to derive the context and story

behind consumer commentary.

(iM)MERGE

Cutting-edge text analytics…

…with human analysis…

A SOLUTION THAT COMBINES:

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METHODOLOGY.

We completed this research using (iM)merge Analytics, a solution that

leverages iModerate’s expert analysts and Luminoso, a cutting-edge text-

analytics software, to help companies easily and efficiently understand what

is going on with their consumers. We’re able to look at consumer

commentary from multiple sources such as social feeds, product reviews,

survey verbatims, and call center transcripts, and distill it down into

actionable findings.

This research was conducted by asking three open-ended questions for

each brand of N=1,000 consumers. Questions were crafted using our

cognitive framework, ThoughtPath.

This content was adapted from a presentation given by Jen Drolet,

Managing Partner of iModerate, and Dr. Catherine Havasi, Founder and

CEO of Luminoso, at the Quirks Event in Brooklyn, NY in February 2015.

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THANK YOU www.imoderate.com // (303) 333-7844 // [email protected]