THE SPIN CYCLE with Todd Smith — Under Armor got caught with its pants down

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Published: February 28,2014

Tags: Business, Deane Smith, JACKSON, Mississippi, Nashville, Tennessee

Todd Smith

Todd Smith

The Winter Olympics was supposed to put Under Armour on the branding podium, but instead the fiasco with the U.S. speed skating team unis flushed it down the half pipe faster than you can say Shawn White.

For this venerable sports apparel brand, the games became a global wardrobe malfunction that made us all forget Janet Jackson, for at least a while, in the pantheon of sports fumbles.

Under Armour unfortunately became a scapegoat for all the bad things that went wrong with an American speed skating team projected to win 10 medals, but came up mostly empty handed. What started off as a spectacular sports bonanza quickly lost its footing, er, skating. In the midst of the Olympics, a small handful of people close to the U.S. team starting blaming the slow times on Under Armour’s supposedly high-tech suits. But that argument was nullified when several skaters reverted to their old uniforms and still failed to earn a medal.

The events put Under Armour in a no-win situation. If Under Armour vehemently defended its reputation as a leader in sports-related technology, it would have had to discredit high-profile athletes, a group that is simultaneously Under Armour’s target market and most valuable endorsers. But if Under Armour said nothing — or, even worse, if its uniforms were shown to be partially responsible for the skaters’ poor times — then its value proposition takes a huge blow on a world stage.

The blame on Under Armour — while possibly invalid — is glaring considering how the company touted the advanced technology of the suit it was providing the U.S. speed skating team. The suit, called Mach 39, was developed in conjunction with Lockheed Martin during a two-year period. Part of the research and development involved testing Mach 39 in wind tunnels. Marketing literature for the suit called it “the fastest speedskating skin in the world.”

It didn’t help that Nike, a fierce competitor, was visible at the Olympics: Its signature swoosh stitched on the jerseys for the U.S. men’s ice hockey team, and other competitors.

While the initial slip-up caught Under Armor with its pants down in the glare of public opinion, the bad press shouldn’t have a lasting effect on the company’s sterling image.

To be totally objective, the Sochi games were not a total wash for Under Armour. Other Olympic teams sporting Under Armour — the U.S. bobsled and skeleton teams and Canada’s snowboard team — all did well at the games. In fact, the American bobsled team notched a bronze medal in the suits — and the U.S. skeleton and Canadian snowboard teams each won a bronze and silver. So there was definitely a silver lining to the growing clouds of crisis.

Another dilemma that forced the brand on a steep downhill slope was the fact that its biggest star was on the sidelines. Under Armour also has a deep and meaningful relationship with skier Lindsey Vonn, a two-time Olympic medalist who is arguably the company’s most recognizable Winter Games athlete. But Vonn injured her right knee in November, costing her a shot at competing in Sochi.

Yet in the face of this near naked negativity, it seems the Under Armour brand remained strong — and made many of the right PR moves. Here’s how they shifted into Olympic reputation repair — and how they must continue even after the Olympics:

» They didn’t blame the skaters. The skaters can point all the fingers they want, but it was critical for Under Armour not to. Instead, the brand continued a strategy of refusing to react defensively.

» Stayed helpful. In the midst of the hubbub, Under Armour continued to consult on the ground. The brand made it clear that it would help the Olympic speedskating team and all the other teams that donned its sleek duds. Acting helpful, and becoming part of the solution, is always great crisis communications.

» Kept the CEO engaged — but not overly so. For a crisis like this, CEO Kevin Plank responded when called upon, striking the right tone and stride during the suit-gate. Let’s face it, Under Armour had a great deal of positive PR capital to spend given the company’s tremendous success story.

» Context, context … context. The uniform issue didn’t involve a mainstream sport like football or soccer, which account for the bulk of Under Armour’s sales

» Go back to the lab. When the glare of the spotlight is off of Under Armour, it must go back to lab and look at the uniforms under a microscope — and possibly have a third party review them for additional credibility. Then march out the solution for the next big competition.

» Brag less. Under Armour’s big mistake was hyping the outfit as the “fastest speedskating outfit in the world,” which set it up for disaster if something ever went wrong, as it did in Sochi.

It will be interesting to see how the controversy effects U.S. Speedskating, which leans heavily on sponsorship agreements for their financial benefit and the wide-ranging exposure they give the sport.

U.S. Speedskating claimed total revenue of more than $4 million in 2013. Most of its revenue, more than $3 million, comes from external fundraising, but nearly half a million dollars came from marketing sponsorships like the one from Under Armour. By tying its organization with a company of Under Armour’s stature gave U.S. Speedskating not just visibility but credibility. The partnership connects the organization with one of the most popular apparel companies in the world.

 

Sugar Coated, Caffeine-Drenched Mic | Krispy Kreme

Krispy Kreme takes the cake — and the Mic — to a whole new level. Best known for their fluffy, sugary, freshly made, confectionary bliss, they are now making a play for another morning rite of passage, coffee! Now that bold beacon beckoning in the sky offers a donut slathered with mocha drizzle and “coffee Kreme” on the outside, complete with mocha filling. It didn’t stop there with the coffee theme. It’s also peddling bottled coffee, meant to compete with Starbucks’ bottled Frappuccino line of highly portable chilled espresso drinks — now available at select Walmart stores.

Each week, The Spin Cycle will bestow a Golden Mic Award to the person, group or company in the court of public opinion that best exemplifies the tenets of solid PR, marketing and advertising — and those who don’t. Stay tuned — and step-up to the mic! And remember … Amplify Your Brand!

» Todd Smith is president and chief communications officer of Deane, Smith & Partners, a full-service branding, PR, marketing and advertising firm with offices in Jackson. The firm — based in Nashville, Tenn. — is also affiliated with Mad Genius. Contact him at todd@deanesmithpartners.com, and follow him @spinsurgeon.

 

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