Friday October 13, 2017
Going long on Yeezys and Jordans: Inside the stock market for limited edition sneakers
more stories from this episode
- How Harvey Weinstein used the media to keep his alleged victims down
- Going long on Yeezys and Jordans: Inside the stock market for limited edition sneakers
- What 'The Curious Incident' reveals about the experience of autism
- Data mining firm behind Trump election built psychological profiles of nearly every American voter
- Joni, Whitney and the cost of stardom
- Riffed from the Headlines 14/10/2017
- Full Episode
Some say you shouldn't judge a person until you've walked a mile in their shoes. But if that person's wearing Yeezys, they aren't likely to share.
Adidas' Yeezy Boost 350 V2 Zebra shoe, designed by rapper Kanye West, retails for $220 US. But in mint condition, the shoe has a 12-month average of $733 US on the secondary market.
That's according to StockX, an online "stock market of things" that specializes in shoes.
"Today you'd never be able to walk into a store three months after a shoe released and buy it. Best case: you can get a shoe three minutes after it released, but probably not even that," StockX co-founder Josh Luber tells Day 6.
Buyers quickly snatch up the limited quantities of brand-new sneakers, then list them for sale online — often with a 200- or even 2,000-per-cent markup.
Some of the rarest shoes are listed with five-figure price tags. And people are willing to pay.
On Saturday, Toronto will host its first-ever Sneaker Con — a massive shoe convention that will draw crowds of people searching for the right pair.
Dedicated sneakerheads like 24-year-old Torontonian Taylor Linds fill closets or entire rooms with shoes, sometimes never even wearing them.
If you can't already tell, the shoe resale market is big business.
In 2016, market researchers pegged its value at $1 billion in the United States alone. Luber believes the real figure is higher than $1.5 billion USD.
"Originally, the secondary sneaker market was an accident," Luber says. "There's no way that in 1985, when Michael Jordan was a rookie, Nike had the foresight or the thought to start this sort of limited release strategy."
But as time went on, more and more brands got wise, he adds.
Now, retailers release limited quantities of shoes, knowing they will be quickly bought out and resold. Analysts say the initial high demand and resale premiums serve to make shoes feel special and keep buyers interested.
And it works.
Luber's company, StockX, has worked to position itself as an authority on the deadstock market.
"Sneakerheads already treat sneakers as assets. You have these shoes that retail for $200, but resale for $1,500 [or] $2,000. So the next logical progression in that was: 'Can we actually use stock-market mechanics to buy and sell?'" Luber says.
StockX lists indices for sneakers, has a stock ticker and hosts sales through a bid-ask process. The site lists sales figures showing how many sales are being made, what shoes are going for, and which pairs are popular.
This information can help buyers and sellers to make informed decisions.
"If you have a market price ... you can have everyone transact across that price," Luber says.
To hear more from Josh Luber and others who collect sneakers, download our podcast or click the 'Listen' button at the top of this page.