Under Armour is deliberately reducing promotional activity by roughly 30% to see if customers trained on markdowns will pay full retail, according to Retail Dive. The test began in late 2024 and runs through the current fiscal year. The company reported the shift during its Q3 earnings call, framing it as essential to restoring brand strength after years of price erosion.
The mechanics are straightforward: fewer site-wide sales, shorter discount windows, and stricter segmentation of promotional inventory. Under Armour is holding full price on core apparel lines—performance tees, training shorts, franchise footwear—and reserving markdowns for end-of-season clearance and outlet channels. The company acknowledges the move will suppress short-term revenue but argues it protects long-term brand equity and operating margin.
Why this matters: discounting trains buyers to wait. When a brand runs perpetual 25-40% off promotions, the customer learns the list price is fictional. Purchase timing shifts to sale events, full-price sell-through collapses, and the brand becomes a margin prisoner. Under Armour spent the better part of a decade in this cycle, competing on price with lower-cost athletic brands while losing ground to premium players like Lululemon that rarely discount. The pullback is a bet that the brand still commands enough loyalty and performance credibility to hold price—or at least that a temporary revenue dip is worth the margin recovery and perceptual reset.
The risk is real. Athletic apparel is a crowded, substitutable category. Buyers can switch to Nike, Adidas, or any number of DTC upstarts without functional loss. Under Armour's recent product innovation has been modest, and its retail distribution is dense, making price discipline harder to enforce. If full-price conversion stalls and revenue drops, the company will face pressure to reverse course before the brand positioning reset takes hold.
The steal for a small physical-product brand: you can run the same test at micro scale without risking the business. Stop running blanket discount codes. Instead, set one full-price launch window—14 to 21 days—where no promotion is available. Use email and social to frame the window as limited inventory, first access, or a specific product story that justifies retail. Track conversion rate and average order value against your previous discounted baseline. If AOV rises even modestly and conversion holds above 60% of your discount-driven rate, you have margin expansion room. After the window, release a single segmented offer—email-only, past buyers, or abandoned cart—at 10-15% off instead of your usual 20-30%. Measure again. The goal is not to eliminate discounts but to shrink their footprint and retrain a slice of your list to buy at higher prices. Start with your hero product or best-selling colorway. If it converts at full price, you have proof of concept to expand the approach across your catalog.
This is not about premium brand theater. It is about testing whether your product and positioning can support higher realized prices before you scale. Under Armour is doing it with tens of millions in revenue at risk. You can do it with a $500 product batch and a 1,200-person email list.