Appeared in Bloomberg BusinessWeek print edition
Feb 4, 2016 (link)
By Matt Townsend
When Under Armour re-signed an endorsement deal with NFL quarterback Cam Newton of the Carolina Panthers before the current season, it looked like a risky investment. The former Heisman Trophy winner wasn’t considered a top NFL player. As he heads into the Super Bowl on Feb. 7, Newton is the favorite for the league’s MVP, according to oddsmakers who also have the Panthers winning the game. “Investing in Cam Newton before this season is like buying Apple before they announced the iPhone,” says Scott Becher, managing director of Z Sports & Entertainment, an advertising agency.
Under Armour’s roster now boasts three of the best players and biggest stars in the NFL, the NBA, and MLB: Newton, Stephen Curry of the Golden State Warriors, and Washington Nationals right fielder Bryce Harper. Like Newton, Curry wasn’t a sure thing. The company picked him up after Nike decided not to re-sign him in 2013 in part because he was injury-prone. Now he’s pro basketball’s reigning MVP.
The company’s eye for talent isn’t confined to team sports. Under Armour signed golfer Jordan Spieth, a relative unknown, right after he turned pro in 2013. Now he’s the No. 1-ranked player in the world.
At about an eighth the size of Nike, the largest sports company in the world, Under Armour can’t spend as lavishly on athletes as its larger competitor. Instead, it bets on young athletes with promise, hoping they become superstars down the road. “We look for maturity, mental toughness, and desire to be great—those things comes first—and then the talent,” says Ryan Kuehl, Under Armour’s vice president for sports marketing and a former NFL lineman.
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