Under Armour (NYSE:UAA) is making waves in the fitness technology industry -- not so much for what it has already accomplished but rather for what the company and industry analysts see as the growing potential of connected health to transform our lives.
In fact, CEO Kevin Plank believes connected apparel and digital fitness tools could have benefits far beyond just improved athletic performance. They could also be the beginnings of a new vision for healthcare.
Only the beginning
With its recent acquisitions, a push into smart apparel, and a new digital headquarters in Austin, Texas, Under Armour is quickly resembling a technology company. The athletic-apparel maker has purchased three major connected fitness apps, and in January, released its own Record fitness app.
Under Armour has also teamed up with HTC to make a hardware fitness-tracking device, similar to those from Fitbit and Jawbone, scheduled for release later this year. While these initiatives have been a great start for the company, they are only the beginning of what could be a widely distributed and analyzed total health account for users.
How Under Armour could change healthcare
Plank has attributed his commitment to the connected fitness industry to the 2011 death of his friend and co-worker, Bill Hampton, who suffered a heart attack while driving in front of Plank on a Los Angeles highway. Plank says the incident demonstrates why everyone should be closely monitoring their health and illustrates the implications fitness tracking could have on the epidemic of heart disease and other conditions.
"The world cannot continue to build larger healthcare systems where you just sit around and wait for people to get sick," Plank said last year.
Right now, Under Armour seems to be focusing its efforts on building the communities and infrastructure necessary to link the various pieces off this connected fitness landscape. Its purchase of mobile health apps MapMyFitness, MyFitnessPal, and Endomondo, along with the release of Record earlier this year, has created a platform of more 130 million users to connect their health to their digital lives.
At one time, Under Armour was making a shirt that could monitor heart rates, though the complexity of the manufacturing has since led to them halt production. However, the potential for connected clothing is there and a major focus for Plank, "If we believe that our future is going to be defined by these hard pieces of glass or plastic that sit in our back pockets, you're crazy. It is going to convert into apparel."
How those shoes and shirts monitor biometrics, plus the whole infrastructure of devices, platforms, and other technology to support that data could ultimately change the way we think about healthcare.
These exciting possibilities include fitness trackers that would enable doctors to have greater access to patient health information, insurance companies with significant data at their disposal to optimize coverage and reduce costs, and more. It will be interesting to see what shape this connected fitness platform ultimately takes.
Is there a market for this?
According to PricewaterhouseCoopers, one in five Americans now owns a wearable monitoring device. The same survey found that 50% of the 1,000 Americans polled said they were likely to buy some sort of wearable fitness tracking device within the next year.
Under Armour is by no means the only company competing in this space. The newly released Apple Watch has a health-tracking and heart rate-monitoring feature. Google recently released its own connected health platform called Google Fit, and Fitbit and other hardware companies continue to release new devices for users to monitor their health. On the software side, there are about 50,000 smartphone apps related to health or fitness tracking. Can Under Armour stand out in this crowded race?
Under Armour has one major advantage in that it is already a premier apparel retailer, with experience designing and selling "smart" clothing that its competitors lack. Nike might be its biggest obstacle in leading this market, though its own tech push has been stagnant after it dropped its FuelBand last year, and nothing particularly exciting has ever become of its own fitness-tracking app Nike+.
While fitness-tracking wristbands seem to be the popular play right now, the future of this space could be in shirts that track biometrics, connected shoes, and so much more that could have implications far beyond just fitness tracking. Under Armour is pushing to define and lead this space -- an amazing opportunity for long-term growth far beyond typical sports apparel.
Bradley Seth McNew owns shares of Apple. The Motley Fool recommends Apple, Google (A shares), Google (C shares), Nike, and Under Armour. The Motley Fool owns shares of Apple, Google (A shares), Google (C shares), Nike, and Under Armour. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.