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From Nike to Under Armour, What it Means to Be a Brand Today

Don’t use “business” or “company” or “organization” when talking about who we are at Under Armour, CEO Kevin Plank tells his 14,000 employees. We are a brand, he shared at Advertising Week on Oct. 4, and a brand is different and special.

“Brands are these tribes that people are able to vote for,” Plank said.

Under Armour rival and athletic wear top dog Nike drove that point home with its 30th “Just Do It” anniversary campaign starring polarizing quarterback Colin Kaepernick. Certain consumer segments predictably revolted against the choice of the controversial former San Francisco 49ers quarterback, whose take-a-knee National Anthem protests of racial inequities against American minorities and specifically, police brutality, have divided many Americans along color and voting lines. People proudly burned and destroyed their Nike gear, vowing never to purchase from the Oregonian brand again.

But, ultimately, Nike’s value swelled by $6 billion in the wake of the advertising blitz, proving that its brand is different, special—and powerful. Interbrand, writing on its Best Global Brands 2018 report released on Oct. 4, confirms this notion, finding that Nike’s intimate customer knowledge and status as among the most trusted brands in the shoe business ensured that the campaign would strengthen its brand affinity while boosting profit margins 30 percent.

“A decade after the global financial crisis, the brands that are growing fastest are those that intuitively understand their customers and make brave iconic moves that delight and deliver in new ways,” Interbrand CEO Charles Trevail said. Of note, Nike took the No. 11 spot on Interbrand’s list with brand value growing 11 percent.

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Our current political and social climate is propelling brands to new significance and centrality, Richard Edelman, CEO of the global PR firm that bears his surname, told conference attendees in New York. He spoke of a “precipitous decline” in the trust consumers have in social media platforms, fallout perhaps from incontrovertible evidence of Russian agents creating armies of Twitter bots and manipulating Facebook to interfere with the 2016 U.S. presidential election. Aligning with meaningful, purpose-driven brands offers consumers a modicum of control in a culture of chaos.

“By buying brands, they’re better able to affect what happens in the world,” Edelman explained, adding that the rise of brand democracy is informing who wields influence in the global arena.

As the “active force” in consumers’ lives, brands are “the point of the spear” for business, the PR rainmaker said, and more so as consumers young and old, rich and less well-to-do, purchase or make a pariah of brands and products based on their values and beliefs. We’ve seen this play out time and again, with Nordstrom and others dropping Ivanka Trump’s products, Patagonia railing against President Trump’s encroachment on Bear’s Ears, and consumers shunning L.L. Bean once the news leaked that the chairwomen had donated to a right-wing political action committee.

In our deeply divided world, it should come as no surprise that this year 64 percent of consumers in an Edelman survey said they “choose, switch, avoid or boycott” a brand as a direct result of its stance on social issues—a rise of 13 percentage points over 2017.

Never before has belief-driven buying increased so sharply, Edelman said.

Under Armour, more than midway through a three-year reset and transformation promoting its position as the “human performance company,” found itself unintentionally in the hotseat following Plank’s pro-Trump sentiments and his outing as a member of Trump’s manufacturing advisory council. The CEO scrambled to reassure brand fans of Under Armour’s commitment to diversity, inclusion and equality.

“Trust is something that is built in drops and lost in buckets,” Plank said, though part of a brand’s greatness lies in its resilience. Not every brand can claw its way back from adversity.

“Consumer retail is about as topsy-turvy a business as you can imagine,” Plank said. Under Armour, which counts NBA superstar Steph Curry, box-office icon Dwayne “The Rock” Johnson and ballerina Misty Copeland as brand ambassadors, would know; its double-digit consecutive-quarter streak of 20-plus percent growth came to a screeching halt last year, prompting the Baltimore-based brand to reconsider its place in the athletic world.

“I want to be the best,” Plank said of his aspirations for Under Armour, the No. 3 athletic apparel maker behind reigning incumbents Nike and Adidas. “I don’t think we have to be the biggest.

“It’s not a zero-sum game,” the Under Armour founder said. “In order for us to be the best, it doesn’t mean others have to go away.”