Under Armour has announced a multi-year sponsorship deal with Gisele Bündchen, the 34-year-old Brazilian supermodel, as part of its efforts to double the size of its women's apparel segment, which has reached annual sales of around $500 million. The terms of the contract have not been revealed, but it was probably facilitated by the fact that Bündchen, who also endorses Victoria's Secret, the sexy brand of bras and women's lingerie, and Ipanema sandals, is married to Tom Brady of the NFL's New England Patriots.
Meanwhile, officials of the company told analysts at a recent Goldman Sachs Conference that they are prepared to bid for more important deals in the international sports arena, like the recent auction for Kevin Durant, the 25-year-old American NBA star who has reportedly agreed to stick with Nike. Under Armour had made a bid for the Manchester United contract, albeit well below Adidas' winning offer, according to an executive of Under Armour.
Under Armour is looking at developing its presence in other, more international team sports besides American football, where it is already very strong, but the management wants to keep marketing expenses at around 11 percent of sales. Determined to make a statement in the booming American basketball market, Under Armour had proposed to pay Durant between $265 million and $285 million over a ten-year period, including shares in the company and the establishment of a community center in his mother's name, but the Swoosh has apparently topped its offer. The deal is not yet official, but according to reports, Durant, who plays for the Oklahoma City Thunder team, has accepted a new ten-year contract with Nike worth up to $350 million, including a $50 million retirement package.
Nike had initially offered to pay only $20 million a year for the renewal of its contract with Durant, which had cost the Swoosh $60 million over the past seven years – a relatively small amount considering that his signature shoes generated estimated revenues of $175 million in the past year. Reportedly, only Lebron James, an older NBA star sponsored by Nike, is going to make more money than Durant, but he has also been making a stronger contribution to Nike's big and growing basketball business with his signature shoes.
