Market Overview

Under Armour Set To Dominate The California Basketball Market

Under Armour Set To Dominate The California Basketball Market

Under Armour Inc (NYSE: UA) was very bullish on its future prospects in the basketball market on its Q3 earnings call this week, and its expanse is far stretched.

Considering the California basketball market for one, it's no surprise that Under Armour is a big brand in the Bay Area, with the brand's flagship athlete Steph Curry leading the charge in Northern California. While Under Armour's presence in the NBA has been widely covered, the company has infiltrated the basketball market at all three levels, from high school recruits to college ball to the NBA.

College Ball

Under Armour made headlines in the collegiate off-season by locking up UC Berkeley and UCLA apparel deals, two of the most high-profile college basketball programs on the West Coast. UCLA and Cal Berkeley are programs to watch, and their recruiting has significantly improved in recent years. Under Armour is set to help boost these programs even further.

Related Link: Under Armour's Revenue Boosted By Strong Shoe Sales And Steph Curry

UCLA will be Under Armour's flagship program on the West Coast, and they have a lot of big time players coming in over the next few years. The impact that the apparel companies have on determining where big-time players go is an under-looked phenomenon that plays a large role in the recruiting process.

Grassroots And Youth

Under Armour entered the grassroots basketball scene just a few years ago, and has taken it by storm with its Under Armour Association league, heavily competing for top youth players among competitors adidas AG (ADR) (OTC: ADDYY) and Nike Inc (NYSE: NKE). Relationships between top athletes at the high school level and apparel brands is a topic that goes under the radar, but it is indeed prevalent.

Why Focus On Such Young Athletes?

The ultimate goal? To get NBA players and sell shoes. The big brands hope they can build a relationship early, so then when they do have a potential endorser headed for the NBA, they will have a loyalty to the brand. With Steph Curry's success on the court translating to big sales in the basketball footwear space, it is no surprise that Under Armour wants to find the next big star. With Curry's reported $14 billion in value he creates for the brand, this is a very big deal.

Under Armour paid a lot of money for the UCLA deal, and wants to make sure the brand makes a big splash. Prior to the UCLA Under Armour deal, basketball analysts at 247 Sports had Under Armour's top youth star Trevon Duval (currently ranked the top point guard in the country by ESPN) was projected to go to Under Armour's flagship East Coast school, Maryland. As soon as the UCLA deal was signed, his projection to UCLA skyrocketed to nearly 100 percent. Coincidence? Probably not.

Related Link: Steph Curry Worth $14 Billion To Under Armour

While critics will say that these youth players are unimportant or too far removed from the league to make an impact, many of these players only compete for one year in college, then jump straight to the NBA and sign an endorsement deal. With Under Armour taking their time in adding new superstars to its basketball roster, it is likely will see some big new signings in the next few years.

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Posted-In: 247 Sports basketball ESPN NBA Steph CurrySports Opinion General Best of Benzinga


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