How Sneakerheads were born

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When I was a freshman in high school, I waited in a line for five days just after school got out. I wasn’t waiting for the new iPhone,

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I was sitting outside to buy a single pair of sneakers. Size 10 or size 14, it didn’t matter to me, I simply had to get my hands on a pair of Nike Air Yeezy 2s.

Now, I had zero intention of ever putting these shoes on my feet (crazy right), I knew right away that within a week of these sneakers releasing they would triple in value as the 5000 unit run would become desired across the globe from people in Japan to China to individuals in Iowa, where there wasn’t a store within 500 miles that released a single pair. Within days, I sold my newly acquired Kanye West Nike Signatures for triple the purchase price. This wasn’t the first time I had “flipped” a pair of sneakers but by far the most lucrative. My passion for sneakers was a major part of high school. I am ashamed to say that I have over 50 pairs of shoes, some still deadstock (unworn). Today, when I think back to all the money spent on shoes I get a little uncomfortable, but I don’t regret for a moment becoming a part of the community of sneakerheads.

You might be asking now why would another ever wait, pay, or care for a pair of sneakers? Sure, you see actresses on the red carpet with a $10,000 dollar high heels but why would anyone give a second look to men’s sneakers.

Based off a small subculture dedicated to collecting Nike sneakers, specifically Air Jordan, Niketalk was created in 1999 as a online forum dedicated to sneakers. Even in the infancy of the internet, it quickly exploded into an extremely popular forum where what we today call #influencers met up to talk about upcoming releases, buy, sell, and trade kicks. It quickly transformed into a massive cultural exchange. DJ AM, famous for his appearance on HBO’s Entourage, was a frequent contributor. Rappers J.Cole and Wale, who is rumored to have over 2,000 pairs, both gained popularity by distributing their music on this platform.

Fast forward to 2006, Matt Halfhill started the website Nicekicks.com, dedicated to giving “Sneakerheads” credible information on sneaker release dates. (Fun Fact: Nice Kicks is credited with the creation of the #throwbackthursday.) Nice Kicks and websites similar to it were pivotal first movers in the quickly expanding sneaker industry, which in 2016 generated $17.5 billion dollars in the US alone. One of the most important contributions of websites like Nice Kicks was aiding the sneaker community and culture through fostering it. So, where does the digital business come into all of this? Last year, the sneaker resale market in the United States was valued at $1 Billion. That’s roughly 5% of the entire athletic footwear industry as a whole.

What’s allowed such rapid monetization of a specific subculture? Answer: Social Media

Instagram and Twitter have been integral in the allowing sneaker consumers to stay constantly connected with their community and allowed businesses to market directly to consumers who are EAGER to catch a glimpse of the latest release. Nice Kicks has over 2.8 million followers on Instagram, while Wale, who is highly connected with Nike and famous for posting glimpses at never before seen shoes, has close to 3 million. The #sneakers on Instagram has over 18 million posts. Once solely brick and mortar stores such as Flight Club (over 2 million Instagram followers) and Stadium Goods now do enormous volumes of sales online.

John McPheters, the CEO of Stadium Goods, a popular sneaker consignment store, has been in the sneaker business for more than a decade, says his store does 90% of its sales over the internet.- Forbes.com

Unfortunately, due to the high demand for sneakers in the past decade, many release events have turned violent. Stores such as Finishline, Footlocker, and others have requested police security to keep in-store releases under control. Specifically, in 2012, a 22 year old named Joshua Woods, lost his life after being robbed by a group of teenagers after he purchased a pair of Air Jordan’s in-store. Popular rapper Macklemore wrote his song Wings in response to murders and robberies related to sneakers.

These tragedies lead to discussion about how to keep releases safe and how can companies responsibly release products to consumers. Online hype driven directly by social media can elevate the shoes to much more than sneakers but to status symbols and the violence associated with them has been blamed on sneaker brands by some due to their choice to keep quantities low, demands high, and to continue to release shoes in store.

On a positive note, many online re-sellers have become major players that supply consumers with limited edition shoes without the hassle.Screen Shot 2017-10-03 at 3.59.35 PM StockX, a virtual stock exchange that trades sneakers instead of stocks has been hugely successful in creating a platform where buyers and sellers can interact. Users of the online platform have personal portfolios with the most valuable portfolio reaching a value of almost $500,000 dollars. Due to such early success in the sneaker business, StockX has expanded it offerings to watches such as Rolex, Audemars Piguet, Omega, and Patek Philippe. The success of this online platform displays the opportunities they provide for the exchange of luxury, exclusive goods on peer to peer online platforms. In the future, we may see boats and cars being exchanged on StockX.

The future of the sneaker industry relies heavily on international expansion. The Chinese market has exploded due to the massive rise in popularity of basketball. Nike is a major player within China. Yet due to the Chinese government’s strict control of social media, “retro” or the majority of the sneakers desired in the American resale market have yet to become widely popular. The future of the sneaker game is the dependent on digital business to connect consumers with the exclusive goods they desire. Social Media will continue to be the driving influencer in the industry as it global spread connects sneakerheads with other sneakerheads from all over the world.

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8 comments

  1. I never really realized how big the men’s sneakers industry is; its pretty cool how social media can shape an entire industry and make it grow so quickly. I’m really interested to learn more about StockX platform and what items will be traded on it next.

  2. This reminds me a lot of the brand Supreme, which has a pretty large apparel subculture. Plenty of (mainly) teenage and young adult men will line up for hours outside of Supreme’s New York store, all with the intentions of purchasing limited releases to resell them online through Ebay and Instagram. A guy I know at BC will go online once a week when they release limited edition items, and resell them through an Instagram account he runs dedicated to the brand and its many followers. Surprisingly, he’s racked in thousands of dollars just by being the first one to purchase!

  3. Hi, Matt! Awesome post! I totally agree with your insight into how social media has allowed specific groups and subcultures to connect and flourish. I think because these platforms are so global they present greater opportunities than ever before for people to find other people that are interested in the same things. And once these platforms start collecting data about what you look at and click on, they can tailor to your interests and help solidify your chances of finding those who are just as passionate about the subject matter as you are.

  4. Wow, I had no idea anything like StockX existed! This is so incredibly interesting and it it continues to be a successful platform, it will be interesting to see how it affects online luxury second-hand retailers like TheRealReal.com and Guilt.com. I have never fully understood the sneaker craze personally, but have had a couple of guy friends who are incredibly dedicated to getting the newest pair of Yeezys and I suspect there will only be more ‘sneakerheads’ out there as the sneaker industry continues to ramp up its presence on social media.

  5. This was a really interesting post. I really liked how you tied in how social media impacted the rise of this subculture! I was abroad last fall and a kid in my group was obsessed with flipping sneakers– he joined all these Facebook groups with other sneaker lovers in Spain so that he knew when all the released were happening. He would also obsessively post Instagrams to try to win contests to be able to pre buy them– it was crazy. Crazy how social media has influenced this fad!

  6. Great post! I was also a “hypebeast” when I was in high school and had a huge collection of rare Nike SB shoes (Tiffany’s, Heinekens, Tweeds, etc) that I bought and would never wear or wear once before flipping. Back then, all we had were small indie online forums where you can talk to other members to schedule physical meetups so it was definitely very dangerous. Now that there are so many other social platforms out there, its safer being on the supply and demand side as a sneakerhead. Imo, StockX should create another platform to become the StubHub of shoes!

  7. I have found the sneaker trend interesting over the past few years. I do suspect that it will turn out to be a bit faddish, though. I remember back in the early dot-com day that there were similar indices of beanie baby values. That’s often the sign of a bubble, because it draws in speculators, not people who genuinely enjoy the hobby of collecting shoes. I’ve been wrong in the past, though.

  8. I found this post really interesting! I used to go on Facebook in high school and browse the “NDSBG” Marketplace group, which was a group specifically designed for buying/selling sneakers among sneakerheads. It’s really cool to see that the industry has changed in many ways, especially the stock market like website for sneakers. However, it is saddening to learn that people have lost their lives just waiting for shoes. It will be interesting to see how this industry changes over time, with new technology and new websites created to serve the demands of sneakerheads.

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