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Under Armour launches 'Curry Brand'

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Under Armour launches a new brand for NBA All-Star Steph Curry - is it too little, too late?

Video Transcript

JEN ROGERS: Hoping to get its act back together, Under Armour is announcing the launch of the Curry brand with NBA star, Steph Curry. Let's bring in Yahoo Finance's Dan Roberts to talk about this deal. So, Dan, I mean, of course they'd love this to end up being like Jordan and Nike, which, if you watch "The Last Dance," Jordan didn't even want to go with Nike at the beginning. He wanted to go with Adidas.

But come on. Is this just too little too late by Under Armour, or could-- does Steph Curry have the power? Does Under Armour have the pipeline? Could this work?

DAN ROBERTS: Well, guys, I think we have to kind of reshuffle the goalposts in terms of our expectations at the beginning. I don't think anyone believes that in the first two years, Curry brand is going to be elevated to where Jordan brand is. I mean, Jordan brand is a $3.5 billion brand on its own separate from Nike. Its jump man logo is itself recognizable without the swoosh.

You know, you notice the Jordan brand stuff doesn't even need the Nike logo on it. It's unclear yet whether the Curry brand stuff will have an Under Armour logo or not, and the rollout includes that new logo. So, you know, that'll take a while.

But it doesn't have to be on par with Jordan brand right away to be a success. The company is engaging in a big turnaround effort, as you said, Jen. And the way that I've been writing about this is as an effort to slim down. I think that's what's obvious.

The company has wiggled out of three expensive D1 school sponsorships recently. It bagged its plans for a big Fifth Avenue, New York City flagship retail location. It's trying to get smaller, put out less volume of product, and raise prices and be seen more as a premium brand.

You hear Kevin Plank say this all the time, and now you hear new CEO, Patrik Frisk, say it. So the Curry brand could be a pivotal part of that. I mean, I think you should expect this stuff to be a little higher priced and to compete with premium fitness brands. And if it can do well in that regard, and if it can help the company get to where it wants to go, then it can be a success.

The problem is the performance basketball sneaker category has been declining every year for five years. And you guys know what we mean by performance. That is, sneakers purchased to be worn for actual basketball, not fashion, not to be worn on the street.

So you know, Patrik Frisk said earlier today in a hit elsewhere that he thought the timing of the brand launch is perfect, because it's between Black Friday and Christmas. Well, I just don't know if kids are going to be clamoring to ask their parents to buy them the newest Curry brand signature sneaker, but maybe. But it's been a tough time, market-wise, for that product category.

- Dan, who actually is the age market? I would assume people 35 and younger. And the Jordan sneakers, by the way, in the last report, a slight drop in sales. But he's my age and ol-- he's actually older, but my generation. Do younger kids even say, Jordan, he's the greatest, still?

DAN ROBERTS: Well, it's funny, Adam. I mean, a lot of people point out these days that there are kids who wear Jordan brand, and they never even saw Jordan play. I mean, I think there's a generation now for whom Michael Jordan just represents a basketball sneaker guy. But it's been mega successful.

Now let's also separate out. Jordan brand sneakers in the retro category sell like crazy. People wear retro Jordans as a fashion statement. But performance basketball sneakers are in decline for all the big brands.

In terms of the age demographic, to your question, it's really kids who play basketball. This has to target kids who actually still play team basketball. So the timing is also tough because it's during a pandemic, when people are home and a lot of youth sports are on pause.

But that said, interestingly, I was talking to an analyst who said that the basketball equipment category is doing very well amid the pandemic, equipment meaning basketball hoops and actual basketballs. And that's because kids who are stuck at home are still shooting hoops in their driveway or in their neighborhood maybe. So there's a chance that this does well, but it's a leap, and it's a risk. I think the Curry brand at first is going to be high risk, high reward for Under Armour.

JEN ROGERS: With two young daughters, I hope he gets into the women's basketball category as well. Dan Roberts, thanks so much for the latest on Under Armour. We will be back with more right after this.