Defending his Masters title from 2015, Under Armour's (NYSE:UAA) sponsored golfer Jordan Spieth is on the course again this weekend and already making headlines. Winning the Masters two years in a row is rare, something that hasn't happened since Tiger Woods did so in 2001-02; that marked only the third time in the event's 82-year history that it's happened.
Under Armour's golf segment has gained an impressive following in the last year thanks to Spieth, the 22 year old Texan that has been taking the sport by storm in the last two years quickly becoming the most celebrated athlete in the sport. Whether Spieth pulls away with another win this year or not, his name and image have already been plastered all over this tournament, each time further promoting Under Armour and it's golf gear.
The 2015 Master's tournament and Spieth's win helped to propel Under Armour in golf apparel sales and publicity, but this year is different already. Now, the company is going into the tournament with more sponsored athletes, more gear, and most importantly recently released golf shoes that Spieth will be wearing throughout the tournament.
Under Armour first signed Jordan Spieth in 2013 on a 2-year contract when he was still relatively unknown fresh out of a few years of college play. The golf phenom quickly rose to fame with incredible wins in 2014. Under Armour ripped up that 2-year contract and signed Spieth in a new 10-year deal. So far that has worked out well for both parties, as Spieth continued to win majors in 2014 and 2015, including his first U.S. Masters win at just 21 years old last year.
But Spieth isn't the only UA sponsored athlete in the tournament. Hunter Mahan is another golfer looking to make a splash at this year's Masters. Gary Woodland is another player with plenty of potential for future events. Under Armour is also busy partnering with various golf organizations like youth golf programs and adding golf simulators to some of its physical stores.
Under Armour has been selling golf pants and polos for some time now, but what really makes Under Armour a formidable force in the golf segment now is the new UA Golf shoes released in March. The three different styles released include the UA Drive One, UA Tempo Tour, and the UA Tempo hybrid. The shoes range in price between $160 and $220, and are available for preorder to ship early May.
Spieth is wearing the UA Drive One this weekend. The shoe sports a waterproof but breathable upper which comes with a 2-year waterproof warranty. The sockliner forms to the shape of your foot, and the sole is made up of the company's "Micro G" foam found in some of its running shoes. Spieth had major input in the design of the shoes, making sure they gave him the flexibility and comfort he needed to perform well at this Masters tournament, his first public competition in the new shoes.
Par for the course
Golf is estimated to be a $70 billion a year industry, much of which is the apparel that goes along with the game. Under Armour's investment in golf has already started to pay off over the last year as UA golf apparel sales helped the company to grow total apparel revenue 22% in 2015 year over year. No one should be surprised by how well Under Armour is growing their golf segment. All one needs to do is to look at what the company is doing in segments such as Basketball and Running, where it's taken a similar approach combining star athletes, great gear, and then finally shoes.
Under Armour is firing on all cylinders and is growing at a rapid clip, evidenced by the company's more than 20% year over year revenue growth in each of the last 25 quarters and 57% growth in footwear sales in 2015 over 2014. Now that Under Armour has made a bigger investment in golf apparel, with these new shoes being worn by one of the most prominent figures at the world's most watched golf event, it seems reasonable to expect the strategy to continue paying off in apparel and footwear sales in 2016 even more than it has already.