Under Armour hit the jackpot on its Jordan Spieth bet
Under Armour originally signed Spieth to an endorsement deal in 2013. But just months before he won the Masters, UA ripped up that deal and gave the 21-year-old a new 10-year contract that was a huge gamble for a player who had one career victory at the time.
The deal has made Under Armour a direct threat to Nike, who picked Rory McIlroy to replace Tiger Woods as the face of their golf wing.
In 2013, Nike signed McIlroy to a 10-year deal reportedly worth a Tiger Woodsian $250 million, hoping that McIlroy would be the next Tiger Woods. While McIlroy has been big for Nike, it is actually Spieth who looks like the next Tiger.
By winning the US Open, Spieth became just the sixth golfer ever to win the Masters and US Open in the same year and joins Woods as the only two golfers to accomplish the feat in the last 44 years.
While we don't know exactly how much Under Armour is paying Spieth - golf deals are often heavily incentive-based - it sounds like UA went all in on the 21-year-old and it is paying off.
Here is how Golf Digest described the deal:
"The deal, which industry insiders say has 'Tiger-like numbers,' includes an eight-figure guarantee annually, bonus benchmarks (for things like winning a major), stock options and, in the future, a signature line of clothing."
On top of that, Spieth is just 21 years old and UA has him locked up until 2025.
Golf Channel analyst Brandel Chamblee was a guest on "The Dan Patrick Show" and was asked if Under Armour would trade their deal with Spieth for McIlroy. After a small chuckle, Chamblee said they wouldn't, but also acknowledged that both Under Armour and Nike are likely happy with their own deals, noting that both golfers never make mistakes with the media, have combined to win the last four majors, and might be "Arnold Palmer-type players" (i.e. charismatic winners).
While the what-have-you-done-for-us-lately factor favors Spieth over McIlroy, it does appear that Spieth is not only one of the most marketable athletes in the world right now, he is also one of the most marketable celebrities, regardless of profession.
Consider these outlandish popularity metrics from Celebrity DBI via Golf Digest:
- 35% of consumers knew who Spieth was before the US Open, up from just 19% before the Masters.
- In "overall appeal/likability" Spieth rose from No. 1,500 to No. 129 out of 3,600 celebrities.
- In terms of consumers aspiring to be like certain celebrities, Spieth is No. 1 among athletes and jumped from No. 333 to No. 4 overall, trailing only Tom Hanks, Bill Gates, and Kate Middleton.
- In terms of "endorsement value" Spieth is No. 5 overall and No. 2 in sports, trailing only Michael Jordan.
And that was before winning the US Open.
All of that will be worth at least $25 million per year in endorsements according to Golf Digest who spoke with agents and marketing experts.
Under Armour still has a long ways to go before they are even in the same neighborhood as Nike, but hitting home runs with athletes like Spieth and Stephen Curry has made UA a legit threat to the king of the sports retail world.