IS THE SNEAKER RESALE BUBBLE ABOUT TO BURST?

It is estimated that the sneaker resale industry would reach $30 billion by 2030. Things look to be on the up and up again for resellers, but what happens if the apparent worth of rare sneakers disappears? Things may alter as a result of the impact COVID may have on commerce and supply, as well as a shift in consumer spending since the pandemic began in 2020. Obviously, this is a concern for resellers all around the world, but for us true sneakerheads, this would be a wonderful thing, right? We'd still buy sneakers, but we'd be able to get them at retail. However, to what degree are the companies involved in allowing this resale market to existing, and what could they do to reverse that?

Sneaker resellers have been around for a long time; it's just that in the last few years, since the launch of apps like StockX and GOAT in 2015, it's gotten a lot simpler to sell your kicks and there are now plenty of entrepreneurs that make a career from it. Although it is feasible to sell without the use of applications, we can't all be Benjamin Kickz, who is well-known in the reselling sector for his celebrity clients. By the age of 15, he started reselling sneakers and made his first million a year later. DJ Khaled, his first significant customer, introduced him to P. Diddy and Drake, and the rest is history. Because not everyone has access to such a high-profile network, these new platforms are a huge appeal for numerous sneakerheads who have built collections over the years, as they now have a simple, safe way to make more than a beautiful penny from their unworn sneakers.

Prior to the applications, customers had to buy from sites like eBay, where sneakers were not verified, you didn't know who you were purchasing from, and you weren't aware whether you were paying more than the sneaker's market worth. You may now buy from StockX, whose three pillars are anonymity, transparency, and authenticity - a concept that appears to be succeeding; they had 7.5 million trades in 2020 alone, worth $1.8 billion. It's a trend that doesn't appear to be slowing down, with the worldwide sneaker resale industry predicted to be worth a whopping £4.2 billion in 2019, a long cry from eBay's yearly shoe transaction worth $388 million in 2014.

StockX, created by Dan Gilbert, Josh Luber, Greg Schwartz, and Chris Kaufman, was valued at $1 billion in 2019 and are now valued at $3.8 billion as of April 2021. This offers a good idea of how huge this resale beast is and how quickly it's developing.

If you were lucky enough to get your hands on a pair of the Nike x Kanye West collaboration Nike Air Yeezy 2 Red Octobers in 2012, you could now resale them for just under £17,000. (Size US12). This clearly demonstrates the impact that excitement, restricted availability and the proper partnership can have on the value of a pair of sneakers.

Diverse cooperation, in particular, has greatly benefitted the resale industry. In the 1980s and the 1990s, professional players were the only ones who would sign their name to a sneaker.

Artists and rappers, as well as fashion designers, are now cooperating with businesses. This casts a far broader net, increasing income for the major companies by allowing them to reach previously untapped people. In addition, as more organizations choose for informal workplace wear (think The Sole Supplier's #tracksuitsnotsuits push), there is a greater demand for variety in people's shoe collections.

The resale market has been claimed to be out of the hands of the large companies, with resellers regularly utilizing bots and teams of "cook groups" to flood apps and platforms, with brands powerless to stop it. That is not to say they have not attempted. Some manufacturers and retail establishments have experimented with various selling techniques in the hopes of getting the product into the hands of individuals who would treasure and wear it, such as online lotteries and drawings and old-school line-ups with the stipulation that you wear your shoes out of the store.

Although corporations would use data to guide production levels, it is possible that they are more concerned with fueling the need for shoes as a commodity than whether or not real lovers of sneakers acquire them. There's definitely an economic purpose for it all, and major companies know what they're doing, but they're still, businesses that need to make a profit, especially in today's unpredictable world.

Unless the major players do anything to battle the resale market, like Nike is doing with the counterfeit market, it will continue to flourish, as research firms predict. However, as these shoe industry behemoths continue to expand at a breakneck pace, is there any incentive for them to alter at all? What would it imply for the brands if they did modify it? Will previously touted models continue to be sought after? Would the releases still be as eagerly awaited? Would the demand for counterfeit shoes be as strong as it is now?

With Cohen Equity Research estimating the global sneaker industry to be worth $100 billion by 2020, and the resale market rising year on year, adding its own substantial share, it appears to be here to stay. So, don't get too excited about buying that touted footwear you want, when you want; that day is still a long way off.