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PLUS, a new pop-up store in Toronto’s Yorkdale Mall, looks like any other high-end shoe store from the outside. Pop-up sneaker stores are easy to ignore, but they are proliferating in malls across North America where an array of mom-and-pop stores, with names like HypeFetish, Heat Vault, and Hype Store., trade in the same type of footwear as PLUS. Many shoppers will come across these stores while looking for a new pair of runners, balk at the prices and never think about it again.
However, these low-key boutiques are part of a huge and booming sneaker resale industry. It fuels a vast economic machine that generates buyers and sellers, investors and authenticators, culture and journalism. Sneaker markets show us the current state of capitalism in the microcosm – and give us a great idea of where it is heading.
The popularity of the sneaker collection dates back to the launch of the coveted Air Jordan 1 in 1985. To many young people – especially young African Americans – it seemed to offer an accessible and accessible version of luxury and status. Sneakers even came to epitomize black expression at a time when the fashion industry was hostile to black culture.
In nascent sneaker culture, the Air Jordan 1s were a statement against white authority made at the highest levels of predominantly black sports like basketball. Originally banned by the NBA, they resulted in fines for Michael Jordan every time he wore them on court. Sneakers have also become a staple of hip-hop culture, athletics, and the black metropolitan: Nike’s white Air Force 1 shoe is colloquially known as Uptown, for example, due to its popularity. in Harlem.
The continued commodification of black culture has made sneakers a powerful cultural totem. Big shoe brands have embarked on popular collaborations with giant personalities in sports, fashion, music and art.
Sneakers, more than any other sartorial item, have come to define and dominate streetwear. It was a subculture that developed from affordable, smart branded skate clothing in the 1990s. It is increasingly moving beyond the boundaries of department stores and skate shops to find a niche. in luxury boutiques and fashion shows.
Growing demand for sneakers around the world has spawned an international resale market, with rare collaborations or colourways being bought, bid on and sold at prices far above their standard retail value – sometimes with a margin of thousands or even tens of thousands of dollars.
Buyers are now using bots to automate the purchase of sneakers to ensure they will get as many pairs as possible to resell in online sneaker markets like StockX and GOAT. Retailers, on the other hand, have sought to guard against such robots through raffles, which has resulted in a proliferation of raffle robots. Raffle robots will automate hundreds, if not thousands of entries. The robots themselves are sold and resold for thousands of dollars and created in limited quantities to ensure their effectiveness in an increasingly competitive arms race.
Consignment and resale stores are a result of the side turmoil becoming a primary business – a business that is now profitable enough to exist in the retail space. Successful buyers market their own guides on investing in sneakers. News articles talk about the value of kicking in investment portfolios. Enthusiastic YouTubers say they’re giddy about whether or not you should ‘sit or sell’, claiming to have some idea of the sneakers’ potential long-term value.
If you have mastered the tricks of the trade, it is very lucrative. Effective resellers can pocket hundreds of thousands of dollars. The terminology of the sneaker resale markets offers a more urban version of the language used by Wall Street banks and investment firms.
With auction houses like Christie’s now embracing the sneaker market, its operators and commentators are increasingly presenting it as a more accessible variant of the art market. In a recent Netflix documentary on famous sneaker designer Tinker Hatfield, one interviewee triumphantly described sneakers as “an art you can wear.” However, the world of sneakers is just as unpredictable as the world of art, organized by the same sort of fickle, wealthy taste makers and celebrities.
Consumers of rare sneakers range from collectors who will flaunt their trophies and keep them as “living dead” – industry jargon for shoes that never get worn – to simple enthusiasts and the so-called disparagingly the “hypebeasts” – the people who covet, wear, and obsess over each new release as a show of wealth.
The global sneaker resale market is valued at $ 2 billion and is expected to triple over the next few years, reaching $ 30 billion by the end of the decade. This fall, StockX opened its first Canadian warehouse, another step of expansion for a global company already valued at $ 1 billion.
The provision of services and even basic products is rapidly moving towards a more profitable subscription model. With the proliferation of closed digital ecosystems, people can lose access to albums or movies just by moving from country to country. In this context, bespoke physical luxury goods such as sneakers become much more distinctive, valuable and sought after as commodities.
It’s easy to present the sneaker riots as a classic example of thoughtless consumerism, with ordinary people submitting to the dictates of the cultural industry. But these tumults are the product of an artificial scarcity. Companies like Nike, which rely on maintaining such a scarcity, launch their products on a limited weekly basis to maintain profits and brand value.
Rich people have no problem paying the price demanded by the resale market and are perfectly content to let the plebs stand in line for days on their behalf. From viral videos of low-income shoppers mobilizing stores on Black Friday to sneaker riots, the demand for simple luxury has become a blood sport for those privileged to laugh at disenfranchised for wanting nice things.
Exploitation has always been part of Nike’s modus operandi, of course. But now it’s spreading to new parts of their supply chain, from the labor and environmental cost of building sneakers to the world of fierce resale.
The resale of sneakers is probably a good indication of how luxury goods will be distributed in the future. Luxury goods such as game consoles are starting to receive the sneaker-bot treatment. The initial versions of the PlayStation 5 and Xbox Series X consoles were bought largely by bots and now sell for high prices on sites like StockX.
While they can’t (yet) fall back on fake consoles, poor consumers can still turn to fake sneakers, a key part of the global $ 451 billion counterfeit market. Most “good” fakes are barely distinguishable from real sneakers and are often made with materials from the same factory – which doesn’t stop other sneakerheads from disparaging those who wear them.
Authenticators make a lot of money examining sneakers, and Instagram accounts that expose people wearing fakes attract hundreds of thousands of followers. It is not uncommon for fake sneakerheads to experience feelings of deep distress, knowing that their outward expression of worth through conspicuous consumption is based on a lie. In a world where young people increasingly own nothing and do nothing, authenticity takes precedence.
Capitalism relies on the idea of competition as a precondition for success, which in turn rests on the assumption – or the lie – that resources are limited. Writers like Aaron Bastani have described ways in which technology could quickly move us into a post-scarcity world. For now, however, this technology increases competition for people at ground level. The technology being deployed in the sneaker markets is in line with their logic: It is designed to make it easier to buy back, resell and buy products, while those at the top, unsurprisingly, benefit the most.
It’s not just Nike and Adidas that make the money: StockX charges a selling fee totaling 12.5%. But even if technology allows small and medium operators to take small bites of the cake, it also exposes them to the vagaries of capitalism. Facebook markets for sneakers are teeming with people who have gone bankrupt due to the pandemic, who are now selling their coveted shoes at rock bottom prices. Stores like PLUS buy low and sell high, taking advantage of gullibility and fear to make the kinds of sales that individuals who are short of cache or resources cannot handle.
The idea that platform sellers capitalizing on scarcity can serve as a viable alternative to work exploiting gigs is becoming increasingly common. If the pursuit of short-lived, high-risk profits becomes more common, it would be disastrous – not only because it offers a false panacea for aspiring scammers and precarious employees, but also because it is a form of procurement. ineffective. Those who really want to wear sneakers, but don’t want to go through the hassle of using bots or paying hundreds more in the resale market, are now the least likely to get them.
The criticisms of consumerism on hotplates are irrelevant when it comes to sneaker culture. Scarcity creates desirability. Without the artificial scarcity and the potential economic windfall it brings, fewer people would have such a keen interest in sneakers or luxury goods in general.
The answer is not to deprive ourselves of such goods – goods that improve our lives, make us feel better about ourselves, or just give us pleasure – but to reduce or eliminate barriers to access, everything. along the chain from production to distribution. Sneakerheads of the world, unite – you have nothing to lose except your robots.
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