Under Armour CEO Kevin Plank Just Cant Escape Trump
Under Armour Chief Executive Officer Kevin Plank has struggled with a Trump problem for six months now. Ever since he expressed support for the new president, he’s faced pressure from consumers and his own endorsers to revisit his position. By joining other CEOs in quitting a White House advisory council, he may have hoped his company would finally be free of the controversy.
It was not to be. Trump resorted to Twitter to slam CEOs who bailed on his American Manufacturing Council in the wake of the Republican’s initial reluctance to condemn white supremacist violence in Charlottesville, Va. Just as happened with retailers who dropped Ivanka Trump’s products, angry Trump supporters responded to Plank’s decision by calling for a boycott.
Plank’s tortured journey began in February, when the CEO of the Baltimore-based sportswear-maker declared himself a fan of Trump. In an interview on CNBC, he praised the president as “pro-business” and a “real asset” for the nation just as debate raged over an executive order to halt the U.S. admission of people from Muslim-majority countries.
The backlash was immediate, and not just from outraged shoppers. Three of the brand’s biggest star athletes came out against Plank’s statements. Basketball superstar Stephen Curry—Under Armour’s prized sneaker pitchman—mocked Trump and raised the possibility he would sever ties with the company. Actor Dwayne “The Rock” Johnson said Plank’s words were “divisive.” Misty Copeland, the ballet icon and star of the company’s women’s clothing campaigns, said she strongly disagreed with the CEO.
Then a Wall Street analyst downgraded the company.
Plank engaged in some quick crisis public relations. He took out a full-page ad in Under Armour’s hometown newspaper on Feb. 15, hoping to clear up his stance on Trump and immigration. In the letter published by the , he wrote that his company stands for equal rights and reinvigorating American manufacturing. He came out against Trump’s travel ban, vowing to join a coalition of companies to oppose such policies. “I personally believe that immigration is the foundation of our country’s exceptionalism,” wrote Plank. Still, he remained on the advisory board.
Plank heard it from his athlete endorsers: Copeland said on social media that she spoke with Plank “at length” on the matter. Curry made his concerns heard as well.
Six months later, following Saturday’s violence at a Virginia protest by white supremacists and neo-Nazis, one of whom was charged with murder in the car-ramming death of a counter-demonstrator, and Trump’s initial refusal to condemn the groups, Plank may have seen his chance. This time, though, he had the cover of other CEOs hitting the eject button. Merck & Co. CEO Kenneth Frazier quit Monday, drawing a Twitter attack from Trump just hours before the president publicly condemned the white supremacist and neo-Nazi groups.
As he followed Frazier’s move yesterday, Plank said he would focus on promoting “unity, diversity, and inclusion” through the power of sport. Intel Corp.’s Brian Krzanich then joined the exodus, echoing Frazier in calling his decision a “matter of personal conscience.” Krzanich was the only one of the three CEOs to explicitly cite Charlottesville. On Tuesday, Scott Paul, the president of the Alliance for American Manufacturing, said he was stepping down, because it was “the right thing for me to do.”
Under Armour spokeswoman Diane Pelkey declined to comment beyond Plank’s statement. But as Trump supporters take the place of anti-Trump groups in criticizing Under Armour, the 45-year-old CEO finds himself and his company still embroiled in a controversy he may have been looking to escape. But this is hardly his only problem.
Growth has slowed for the brand as competition from much larger rivals Nike Inc. and Adidas AG mounts. Most concerning of all to the company is the slowdown in sneakers. Shoe sales are suddenly headed in the wrong direction after years of growth, as the company reported a 2 percent decline in footwear sales to $237 million last quarter, compared with a 58 percent increase in the same period the year prior. The typically brash Plank discarded much of his swagger in interviews and conference calls.
While Under Armour has done well with its on-field merchandise, an initiative to expand beyond playing fields and onto city streets has proven tough. Denouncements from its own popular athletes (and their fan followings) over Plank’s stance on Trump has likely done little to sway shoppers.
Put simply, Under Armour has been unable to establish itself as a cool street brand. Plank admitted it himself in January, saying his brand needs to “become more fashion.” One such effort is Under Armour’s new UAS line, a high-end take on sportswear touted by runway shows and celebrities. Run by designer Tim Coppens, formerly of Ralph Lauren and Adidas, looks range from tailored sportcoats to uniquely quilted vests. Color-blocked long sleeve shirts, stretch bombers, and polos are all sleek and fitted, a performance version of the baggier silhouettes often seen in streetwear.
Under Armour fell 4.5 percent to $17.99 at 1:05 p.m. in New York.