Week #4, Blog Entry #4: Marketing Strategy & Group Project
This week’s lessons focused on the 4Ps of Marketing and a group project that applied all the business concepts we have learned so far. We specifically analyzed the sales management mistakes made by Under Armour, which resulted in monetary penalties and damage to their brand, retailers, and customer base.
4 P’s of Marketing Implementation: Product, Price, Promotion, and Physical Distribution
The insights gained from extensive market and customer analysis are incorporated into a comprehensive marketing and advertising strategy, tailored to specific customer segments. This marketing implementation will emphasize advertising campaigns across designated retailers and platforms, informing customers about product offerings, product positioning, pricing, availability in retail stores, benefits, complementary products, and promotional and loyalty programs (Villegas, 2021).
Product definition allows us to identify what we are offering consumers, whether it is a tangible product that customers can acquire, an intangible service that does not confer ownership or a combination of both. Product positioning targets a product’s audience by creating a compelling statement that helps customers easily identify the product and distinguishes it from competitors (Murphy, 2023). Highlighting the differences and advantages of a product compared to others in the market adds value and demonstrates its necessity for customers. Effective product positioning motivates target customers to choose the company’s products. The product definition also helps company employees stay focused on the product offering and target. Understanding the customer base is essential for shaping product differentiation and positioning strategies.
Product pricing reflects the customer-perceived value of the offered product. Products should clearly define the value they bring to customer’s lives, setting up expectations for that value. Product differentiation allows a product to stand out in the market, thereby justifying its pricing strategy (Grewal & Levy, 2025). Pricing involves five components (the 5Cs): cost of production, customers, competitors, channels of distribution, and product compatibility with long-term company objectives (Gomez, 2023). The cost of production and distribution are explicit costs that determine the minimum price target, while market competitors and company objectives influence the ultimate pricing decision. Customers are the final judges of product price based on their subjective perception of the product's value. Some products may command a premium price due to the customer’s perceived value, while others may be priced competitively or have a price based on the customer’s psychological value.
Product promotion involves advertising tailored to various markets based on their target customer segments. This can range from printed newspapers and magazines to billboards and social media.
Physical product distribution aims to increase sales, enhance product branding (Thimothy, 2022), and foster customer loyalty while leveraging complementary products for increased profits. The distribution strategy includes retailers, factory outlets, discount stores, social media platforms, and other direct e-commerce channels, in addition to complementary product bundling.
Group Project: Mistakes in Under Armour's Sales Strategy
We were assigned an article that described Under Armour’s sales strategy a few years ago, which focused on meeting aggressive sales targets. Our group held three meetings and engaged deeply in analyzing the company’s sales strategies and potential alternatives to avoid the shareholder and federal scrutiny that occurred as a result of the company’s strategy.
In 2019, The Wall Street Journal reported that Under Armour executives pressured employees to maintain a consistent sales growth of 20% each quarter. To achieve this objective, company employees were instructed to “pull sales forward” through special offers and promotions, which risked negatively impacting future sales by bringing them forward earlier than anticipated (Safdar & Viswanatha, 2019). The company also enticed retailers with additional discounts and extended payment terms for merchandise within existing contracts, manipulating accounting documentation to meet target figures. They also redirected inventory from premium factory stores to discount outlets. The company’s leadership failed to disclose this critical inventory management technique to investors during financial calls. This sales strategy led to shareholder uncertainty and federal investigations by the U.S. Department of Justice and the Securities and Exchange Commission (SEC) (Viswanatha & Safdar, 2019). Ultimately, Under Armour settled with the SEC and investors, paying $9 million to the SEC and $434 million to its shareholders (Ojea & Pacheco, 2024).
To manage sales targets and any excess inventory more effectively in the future, Under Armour should have implemented alternative strategies. To mitigate legal risks and foster relationships with retailers, consumers, and investors, the company should have employed better demand forecasting analytics to adjust production, provide retailers with incentives and discounts, retrain their workforce, and display transparent communication with their investors. We believed that integrating the 4Ps marketing strategy, reengineering its manufacturing and inventory efficiency, and eliciting feedback from its customers and retailers would have helped its sales targets. In our opinion, Under Armour needed to move from short-term sales tactics to long-term brand-building sustainable growth strategies.
References:
Villegas, J. (2021). Overview of Marketing by Dr. Villegas. Lecture on Overview of Marketing. Personal Collection of J. Villegas, University of Illinois Springfield, IL.
Grewal, D., & Levy, M. (2025) Marketing [PowerPoint Slides]. McGraw Hill Companies. Pricing - Slides.
Thimothy, S. (2022, April 12). What Brand Positioning Is And Why It’s Important For Your Business. Forbes. https://www.forbes.com/councils/theyec/2022/01/14/what-brand-positioning-is-and-why-its-important-for-your-business/Links to an external site..
Murphy, M. (2023.). 12 positioning statement examples and how to write your own (free template). https://www.zendesk.com/blog/positioning-statement-examples/
Gomez, M., et.al. (2023, Jan. 25). Principles of Marketing. OpenTax. https://openstax.org/books/principles-marketing/pages/12-2-the-five-critical-cs-of-pricing
Safdar, K., & Viswanatha, A. (2019, November 14). Inside Under Armour’s sales scramble: ‘Pulling forward every quarter’. The Wall Street Journal. Retrieved from https://www.wsj.com/articles/inside-under-armours-sales-scramble-pulling-forward-every-quarter-11573777489
Viswanatha, A., & Safdar, K. (2019, November 4). Under Armour is the subject of federal accounting probes. The Wall Street Journal.
Ojea, S., & Pacheco, I. (2024, June 21). Under Armour to settle claims over past financials with $434 million payment. The Wall Street Journal.
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