6 ms·

You See Sneakers, These Guys See Hundreds of Millions in Resale Profit (2014)

74 points by t23 9y ago

jaymzcampbell 9y ago
I used to work as a developer on a large sneaker site based in the UK (Crooked Tongues). Before then I had just thought of sneakers as something you wear. One of the guys I worked with was heavily into it and since we would get a (heavy) discount he'd suggest pairs to me I should buy purely as an investment. I think the best return I had was nearly quadrupling my money on a pair of Air Jordan 5s. One of the last projects I worked on at the agency was a book of rare and collectables [1] - I think at one point we had the equivalent of half a million dollars sat behind my desk (the large yellow box in the middle is the Nike "Air Mag" Marty Mc Fly sneaker they mention in the article) [2]. After all this I understood a hell of a lot more that there's money in anything when enough people want it. Sounds obvious, but I didn't fully appreciate it until then. That and the power of marketing to create value out of thin air. [1] http://www.thamesandhudsonusa.com/books/sneakers-the-complete-limited-editions-guide-hardcover http://www.thamesandhudsonusa.com/books/sneakers-the-complet... [2] https://i.imgur.com/bO6nYts.png https://i.imgur.com/bO6nYts.png
- patrickbynu 9y ago
  > a large sneaker site based in the UK You don't call them sneakers in the UK though do you? I thought you called them 'trainers'.
  - _asummers 9y ago
    I've heard "runners" as well.
  - bartread 9y ago
    Not in general parlance, but people know what sneakers are, and certainly those into collecting would probably use the term.
  - jaymzcampbell 9y ago
    Within the office and industry, it was "sneakers" everywhere. [1]. All the guys in the office and anyone seriously collecting or lurking on the forums pretty much always said "sneakers". Anyone who wasn't into the scene though would say trainers. I'm from Northern Ireland, so until I moved to the "mainland" I actually referred to them as "guddies". [2] [1] https://web.archive.org/web/20131031030318/http://www.crookedtongues.com:80/ https://web.archive.org/web/20131031030318/http://www.crooke... [2] https://www.inyourpocket.com/belfast/How-till-spake-Norn-Iron-A-guide-to-local-phrases_70619f?&page=1 https://www.inyourpocket.com/belfast/How-till-spake-Norn-Iro...
    - sosa2k 9y ago
      What about "creps"?
  - dboreham 9y ago
    Gym Shoes. Or if you're my Dad: Plimsolls.
- danielrmay 9y ago
  Interesting! Over the last few years, as popularity has seemingly increased, I've noticed more and more the use of bots to speed up the checkout process and ensure that fans don't miss out on "drops". Did you see any of this while you were working there, and did you work on anything to try and combat this? Very curious as to whether this is recognised and active measures are put in place to discourage the behaviour.
  - jaymzcampbell 9y ago
    Nope. Big drop days where always sold out in minutes if that. The main thing we would do is add additional capacity before launch or for certain releases limit the amount in any one particular basket. Other than that we'd ban IPs that were hammering the site but didn't look out for anything automated. If the money cleared for the transaction then we delivered. We never saw anything particularly weird (like a whole size run shipping to one address) from 2008 - 2013. The site itself ended up sold to ASOS after that and they took it all in-house until they eventually killed it [1]. [1] https://www.drapersonline.com/news/asos-closes-footwear-etailer-crooked-tongues/5071419.article https://www.drapersonline.com/news/asos-closes-footwear-etai...
- e12e 9y ago
  > I understood a hell of a lot more that there's money in anything when enough people want it. Sounds obvious, but I didn't fully appreciate it until then. That and the power of marketing to create value out of thin air. Reminds me of: "Experience: I mine for 100-year-old jeans" https://www.theguardian.com/lifeandstyle/2015/sep/25/experience-i-mine-for-denim https://www.theguardian.com/lifeandstyle/2015/sep/25/experie...
revelation 9y ago
Sounds like an altcoin
- coldtea 9y ago
  Yes, but one people actually can use.
  - wmf 9y ago
    A utility token?
Jonovono 9y ago
I use to run a super popular sneaker encyclopedia and collected shoes. Mostly lost interest in shoes and then the site slipped from popularity, but it was an interesting time. I had every Nike Dunk colorway name and Air Jordan memorised hah. I still appreciate nice shoes just as people like art. Some of the sneaker designers like Tinker are truly artists.
blairanderson 9y ago
FWIW this article is 3 years old and much has changed in the shoe game.
- egman_ekki 9y ago
  would you care to elaborate?
  - zaveri 9y ago
    A number of new players in consignment like GOAT, Stadium Goods for instance. https://www.goat.com https://www.goat.com https://www.stadiumgoods.com https://www.stadiumgoods.com
pavel_lishin 9y ago
Are sneakers significantly different from beanie babies or Magic the Gathering cards?
- bgilroy26 9y ago
  Are Beanie Babies similar to Magic the Gathering cards? Fashion sneakers, Beanie Babies, and MtG cards all have had prices inflated above the price for comparable goods (regular sneakers, teddy bears, and regular playing cards), you can say that. Fashion sneakers and MtG cards have had longer runs in popularity than Beanie Babies had and sneakers have more intrinsic value to people than either MtG cards or Beanie Babies do, but they're all different. You can say that they are all fads, but owning shares of a company, learning a particular programming language, or picking a university to apply to are all subject to waves of popularity that can obscure their value for people as well. The question seems disingenuous.
  - lackbeard 9y ago
    > sneakers have more intrinsic value to people than either MtG cards or Beanie Babies do I'm pretty sure MtG cards have a lot of intrinsic value to the people who play with them. Much more than collectable sneakers. Also, I don't think regular playing cards are comparable goods to MtG cards. You can't play MtG with them!
    - skybrian 9y ago
      But if people didn't care about counterfeits, you could make your own cards, right? For any non-collectible card game, noone would care if the cards are "authentic" or not. This is sort of like the difference between original art and a high-quality replica. Market value has its own logic that's often independent of use-value.
  - pavel_lishin 9y ago
    > The question seems disingenuous. I know. And I even thought about that before I commented, but I don't know how else to ask without three paragraphs of what would basically amount to "I'm not racist, but" clarifications. It really does seem like a weird bubble, though. Sneakers do have intrinsic value - you can always walk in your collection, which is more than you can say for Beanie Babies or MtG cards - but it's still just a handful of companies producing something whose value stems from arbitrary production restrictions. Why sneakers? Why not hats or socks? But I guess it's just arbitrary, like wine, or collectible angel dolls, or that weird fancy cut glass stuff I see in malls whose name escapes me, or comics.
mbid 9y ago
You See Sneakers, I See Tulips.
- robotcookies 9y ago
  I think there is a difference here. With Tulips, all the buyers were people intending to sell at a higher price. Initially, yes people bought them for the product itself. But it came to point where all the buyers were just interested in reselling them. They were buying for price appreciation and not the product itself. With sneakers it's different because the prices paid are by people interested in the product itself. In that sense this is more like comic books or baseball cards. And these things can keep their high prices indefinitely.
rtnyftxx 9y ago
There is even a Numb3rs episode http://www.imdb.com/title/tt1256331/ http://www.imdb.com/title/tt1256331/
pascalxus 9y ago
There are days, when I just dont understand. I understand Nike's position and the resellers and the entrepreuners - they're all making good money off all this. But, for the non-investers, those at the end of the chain, I can't even begin to imagine why someone would pay over 5000, or 1000$ or even over 60$ for a pair of shoes. Perhaps, i could understand if it was the top 1% of the income ladder. But, we're talking about middle class buyers right? The very same ones who struggle to pay rent and food, the 65% of the population we keep hearing about who has less than 400$ in savings? Is a pair of shoes more valuable than having a home to live in? I'm confused.
- hbosch 9y ago
  This is enthusiast/hobbyist level fandom. If you think this is crazy, look at the market for Coca Cola or Star Wars collectibles.
- libertine 9y ago
  I think Wizards of the Coast for example don't quite understand the value of having such markets. When products of your brand reach this kind of status, you shouldn't be greedy about it... just play ball. They only have positive gains imo...

74 points by t23 9y ago

I used to work as a developer on a large sneaker site based in the UK (Crooked Tongues). Before then I had just thought of sneakers as something you wear. One of the guys I worked with was heavily into it and since we would get a (heavy) discount he'd suggest pairs to me I should buy purely as an investment. I think the best return I had was nearly quadrupling my money on a pair of Air Jordan 5s. One of the last projects I worked on at the agency was a book of rare and collectables [1] - I think at one point we had the equivalent of half a million dollars sat behind my desk (the large yellow box in the middle is the Nike "Air Mag" Marty Mc Fly sneaker they mention in the article) [2]. After all this I understood a hell of a lot more that there's money in anything when enough people want it. Sounds obvious, but I didn't fully appreciate it until then. That and the power of marketing to create value out of thin air. [1] http://www.thamesandhudsonusa.com/books/sneakers-the-complete-limited-editions-guide-hardcover http://www.thamesandhudsonusa.com/books/sneakers-the-complet... [2] https://i.imgur.com/bO6nYts.png https://i.imgur.com/bO6nYts.png

patrickbynu 9y ago
> a large sneaker site based in the UK You don't call them sneakers in the UK though do you? I thought you called them 'trainers'.
- _asummers 9y ago
  I've heard "runners" as well.
- bartread 9y ago
  Not in general parlance, but people know what sneakers are, and certainly those into collecting would probably use the term.
- jaymzcampbell 9y ago
  Within the office and industry, it was "sneakers" everywhere. [1]. All the guys in the office and anyone seriously collecting or lurking on the forums pretty much always said "sneakers". Anyone who wasn't into the scene though would say trainers. I'm from Northern Ireland, so until I moved to the "mainland" I actually referred to them as "guddies". [2] [1] https://web.archive.org/web/20131031030318/http://www.crookedtongues.com:80/ https://web.archive.org/web/20131031030318/http://www.crooke... [2] https://www.inyourpocket.com/belfast/How-till-spake-Norn-Iron-A-guide-to-local-phrases_70619f?&page=1 https://www.inyourpocket.com/belfast/How-till-spake-Norn-Iro...
  - sosa2k 9y ago
    What about "creps"?
- dboreham 9y ago
  Gym Shoes. Or if you're my Dad: Plimsolls.
danielrmay 9y ago
Interesting! Over the last few years, as popularity has seemingly increased, I've noticed more and more the use of bots to speed up the checkout process and ensure that fans don't miss out on "drops". Did you see any of this while you were working there, and did you work on anything to try and combat this? Very curious as to whether this is recognised and active measures are put in place to discourage the behaviour.
- jaymzcampbell 9y ago
  Nope. Big drop days where always sold out in minutes if that. The main thing we would do is add additional capacity before launch or for certain releases limit the amount in any one particular basket. Other than that we'd ban IPs that were hammering the site but didn't look out for anything automated. If the money cleared for the transaction then we delivered. We never saw anything particularly weird (like a whole size run shipping to one address) from 2008 - 2013. The site itself ended up sold to ASOS after that and they took it all in-house until they eventually killed it [1]. [1] https://www.drapersonline.com/news/asos-closes-footwear-etailer-crooked-tongues/5071419.article https://www.drapersonline.com/news/asos-closes-footwear-etai...
e12e 9y ago
> I understood a hell of a lot more that there's money in anything when enough people want it. Sounds obvious, but I didn't fully appreciate it until then. That and the power of marketing to create value out of thin air. Reminds me of: "Experience: I mine for 100-year-old jeans" https://www.theguardian.com/lifeandstyle/2015/sep/25/experience-i-mine-for-denim https://www.theguardian.com/lifeandstyle/2015/sep/25/experie...

revelation 9y ago

Sounds like an altcoin

coldtea 9y ago
Yes, but one people actually can use.
- wmf 9y ago
  A utility token?

Jonovono 9y ago

I use to run a super popular sneaker encyclopedia and collected shoes. Mostly lost interest in shoes and then the site slipped from popularity, but it was an interesting time. I had every Nike Dunk colorway name and Air Jordan memorised hah. I still appreciate nice shoes just as people like art. Some of the sneaker designers like Tinker are truly artists.

blairanderson 9y ago

FWIW this article is 3 years old and much has changed in the shoe game.

egman_ekki 9y ago
would you care to elaborate?
- zaveri 9y ago
  A number of new players in consignment like GOAT, Stadium Goods for instance. https://www.goat.com https://www.goat.com https://www.stadiumgoods.com https://www.stadiumgoods.com

pavel_lishin 9y ago

Are sneakers significantly different from beanie babies or Magic the Gathering cards?

bgilroy26 9y ago
Are Beanie Babies similar to Magic the Gathering cards? Fashion sneakers, Beanie Babies, and MtG cards all have had prices inflated above the price for comparable goods (regular sneakers, teddy bears, and regular playing cards), you can say that. Fashion sneakers and MtG cards have had longer runs in popularity than Beanie Babies had and sneakers have more intrinsic value to people than either MtG cards or Beanie Babies do, but they're all different. You can say that they are all fads, but owning shares of a company, learning a particular programming language, or picking a university to apply to are all subject to waves of popularity that can obscure their value for people as well. The question seems disingenuous.
- lackbeard 9y ago
  > sneakers have more intrinsic value to people than either MtG cards or Beanie Babies do I'm pretty sure MtG cards have a lot of intrinsic value to the people who play with them. Much more than collectable sneakers. Also, I don't think regular playing cards are comparable goods to MtG cards. You can't play MtG with them!
  - skybrian 9y ago
    But if people didn't care about counterfeits, you could make your own cards, right? For any non-collectible card game, noone would care if the cards are "authentic" or not. This is sort of like the difference between original art and a high-quality replica. Market value has its own logic that's often independent of use-value.
- pavel_lishin 9y ago
  > The question seems disingenuous. I know. And I even thought about that before I commented, but I don't know how else to ask without three paragraphs of what would basically amount to "I'm not racist, but" clarifications. It really does seem like a weird bubble, though. Sneakers do have intrinsic value - you can always walk in your collection, which is more than you can say for Beanie Babies or MtG cards - but it's still just a handful of companies producing something whose value stems from arbitrary production restrictions. Why sneakers? Why not hats or socks? But I guess it's just arbitrary, like wine, or collectible angel dolls, or that weird fancy cut glass stuff I see in malls whose name escapes me, or comics.

mbid 9y ago

You See Sneakers, I See Tulips.

robotcookies 9y ago
I think there is a difference here. With Tulips, all the buyers were people intending to sell at a higher price. Initially, yes people bought them for the product itself. But it came to point where all the buyers were just interested in reselling them. They were buying for price appreciation and not the product itself. With sneakers it's different because the prices paid are by people interested in the product itself. In that sense this is more like comic books or baseball cards. And these things can keep their high prices indefinitely.

rtnyftxx 9y ago

There is even a Numb3rs episode http://www.imdb.com/title/tt1256331/ http://www.imdb.com/title/tt1256331/

pascalxus 9y ago

There are days, when I just dont understand. I understand Nike's position and the resellers and the entrepreuners - they're all making good money off all this. But, for the non-investers, those at the end of the chain, I can't even begin to imagine why someone would pay over 5000, or 1000$ or even over 60$ for a pair of shoes. Perhaps, i could understand if it was the top 1% of the income ladder. But, we're talking about middle class buyers right? The very same ones who struggle to pay rent and food, the 65% of the population we keep hearing about who has less than 400$ in savings? Is a pair of shoes more valuable than having a home to live in? I'm confused.

hbosch 9y ago
This is enthusiast/hobbyist level fandom. If you think this is crazy, look at the market for Coca Cola or Star Wars collectibles.
libertine 9y ago
I think Wizards of the Coast for example don't quite understand the value of having such markets. When products of your brand reach this kind of status, you shouldn't be greedy about it... just play ball. They only have positive gains imo...