Brand Health Check: Umbro

The football-kit manufacturer is suffering a sales slump. Could the brand's specialisation be partly to blame?

Umbro stands for football. 'We spend 0% of our time thinking about other sports. Which leaves 100% of our time to think about football, and how to make better football pro-training kit,' stated one of its ads in a campaign intended to highlight its specialist credentials.

The brand is official kit supplier to numerous national teams, including Sweden and the Republic of Ireland, and top-flight club sides such as Everton, West Ham and Glasgow Rangers. But for more than 20 years the jewel in Umbro's crown has been its relationship with the England football team.

However, last week the company revised its 2007 profits forecast from £30m to just over £22m following a slump in sales of replica kits. A decline from its strong performance in 2006 - a World Cup year - had, naturally, been expected, but tough retail conditions, the possibility that England may not qualify for Euro 2008 and bad weather also appear to have taken their toll.

According to Umbro, it sold less than half as many England shirts over the key summer sales period as it had hoped to; it is now likely that by the time the latest England kit launches next year, stores will be left with an 'overhang' of the previous strip that could deter retailers from placing orders for the new one.

Although England's World Cup and European Championship campaigns have proved fruitless for more than 40 years, the national team has always been among the best supported at major tournaments and consequently shirt sales have flourished.

Last month, Umbro hired Love to manage its global advertising account, which will see the agency leverage the brand's association with England stars Michael Owen and John Terry and Portugal international Deco ahead of Euro 2008.

If England somehow squanders its position in its Euro 2008 qualifying group and fails to make it to the tournament next summer, Umbro warned in its interim results two weeks ago that it could miss its sales targets and lose a further £15m - an admission that wiped more than 16% off the value of its shares the same day.

We asked Tim Crow, chief executive of specialist marketing consultancy Karen Earl Sponsorship, and David Farrow, managing director of Ogilvy Action Sports & Entertainment, if it is time for Umbro to look beyond its core business in order to secure its future.

DIAGNOSIS 1 - TIM CROW CHIEF EXECUTIVE, KAREN EARL SPONSORSHIP

Nike and Adidas have muscled Umbro out of the upper echelons of football and, as its recent profit warning demonstrated, forced it to become overly reliant on a 'feast or famine deal' with England that stretches to 2014.

If England qualifies for the European and World Cup finals - the key premise of the deal - the Three Lions may well fly off the shelves, but even then the Umbro brand is always out-shouted and out-marketed by the big two.

Umbro's distribution has become very narrow and downmarket, stifling its attempts to find a fashion and leisure-wear mojo, and driving the brand into Burberry-check territory. Whereas Nike and Adidas use football - and much else besides - to convert fans into brand loyalists, most people wouldn't buy an Umbro product unless it sponsored their team. And even then, they would probably prefer Nike and Adidas, and have a drawer full of their gear.

So driving reappraisal has to be the priority. It's time to get radical: Umbro is a challenger brand waiting to be (re)born.

REMEDY

- Reinvent Umbro as a challenger brand, taking on the big category bullies. We all love an underdog.

- Persuade the Football Association to market the England team in the same way, rather than continuing to pretend that we are still living in the afterglow of the 1966 World Cup final.

- Reclaim and re-tool the brand identity in retail.

- Sponsor less, activate more.

DIAGNOSIS 2 - DAVID FARROW MANAGING DIRECTOR, OGILVY ACTION SPORTS & ENTERTAINMENT

Umbro's greatest strength - its exclusive focus on football - is also its biggest weakness. It represents the old-fashioned face of the game. Its core customers are the true fans who stand on the terraces, turning out to support their team through thick and thin. It's a world away from the modern face of the sport, yet it needs to evolve for the 21st century.

It has a strong dependence on national team licences, so its business is locked in to World Cup-focused four-year cycles - a major issue. The best sales come from club brands, yet, unable to afford the prices demanded by the leading teams, its ties are with the likes of Wigan Athletic, associating it further with 'old' football.

Umbro should maintain its absolute focus on soccer, but via new and engaging means. It already backs the Umbro Heroes Award and the World Tournament Amateur Cup, but who knows about it? What about a branded outlet offering apparel and memorabilia, and initiatives like soccer training to build a community and differentiate itself from Adidas, Puma and Nike with their fabulous retail destinations?

REMEDY

- Reinvent the traditional side of football and make Umbro's brand values relevant.

- Get a designer to reinterpret these values and create apparel for a new generation. The market for leisurewear, especially replica kit, is finite, so diversify.

- Reinforce the brand's ties to grass-roots football through participation initiatives allowing fans to interact with it.

- Internationalise. Build the brand in places where football is not yet fully developed.

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