Under Armour CEO Kevin Plank and his soon-to-be successor, Patrik Frisk, laid out their plans for the future of the brand in a joint interview with Fortune on Tuesday.The duo emphasized that Under Armour would focus on being a performance-wear company over anything else.This marks an important shift away from its strategy of doubling down on athleisure, an important trend that analysts had said it missed out on.Plank announced on Tuesday that he would step down as CEO.Visit Business Insider’s homepage for more stories.Wall Street criticized Under Armour for being late to the party when it came to athleisure. Now the company is betting that this trend won’t last forever.In a joint interview with Fortune on Tuesday, CEO Kevin Plank and his soon-to-be successor, Patrik Frisk, discussed the future of the brand following the announcement that Plank would step down as CEO at the end of the year; he’ll stay on as the company’s executive chairman and brand chief.”It’s about making sure we are focused,” Frisk told Fortune’s Phil Wahba. “The brand positioning is very clear for us: we’re a performance company.”Wahba described Frisk as saying that “people want both performance and aesthetics in their athletic wear now.”Read more: Under Armour CEO Kevin Plank explains how he’s getting the company back on the front foot after a bumpy 3 yearsThis marks an important shift in Under Armour’s strategy. After racing to jump on athleisure — following a period of intense criticism from analysts that it had missed out on the trend — the brand seems to be pulling back and instead focusing on its core offering: straight-up athletic wear.This isn’t the first time that management has discussed this change. At the end of last year, Plank said in an interview with the Financial Times that the company had lost focus and would go back to being a performance brand.If people “want to go sit on the couch they can, but that product was built to help them get through a 10-mile run,” he told the Financial Times. “We don’t dissuade them from doing it — we just need to know who we are.”He added: “We are a performance brand. That is what we’re going to be and going to stand for, becoming the best in the world at that.”Athleisure has been a dominant trend in the athletics and apparel market over the past decade. Lululemon, the company often credited with inventing it, has seen explosive growth in recent years while revenue at Under Armour has declined. In its most recent earnings results, in July, Under Armour missed revenue forecasts and said it expected a sales decline in North America for 2019, which would be the third straight year of declining sales.Stepping back from the athleisure trend might not be a bad thing, however, if Under Armour has failed to make significant tracks in that area.One analyst in 2017 outlined the downsides of trying to play catch-up.”It will take years for the category to have a measurable impact to the company with potential starts and stops along the way as lifestyle requires more trial and error and sample testing than core basic technical gear,” the Wedbush analyst Christopher Svezia wrote.While there have been mixed reports about whether the athleisure trend is slowing down after a decade of growing at breakneck speed, the market is clearly becoming more saturated, making it more competitive.In any case, Plank has his sights set on more adventurous products that will “blow people’s minds,” he told Wahba.”We want to continue to make products for people that they never knew they needed, and once they have them, they don’t know how they could live without them,” he said.Read the Fortune interview »
Under Armour will turn its back on one of the biggest trends in apparel under its new CEO – Business Insider
