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Warwick Cairns, Strategist, The Effectiveness Partnership

Sneakerheads, sneakerbots, and what makes for effective marketing in a world in transformation.

It’s said that we have stone-age minds in a space-age world. It’s said that our brains and bodies got to be this way by being naturally selected over millions of years to deal with important and recurrent problems in the ancestral past. Like finding mates, protecting offspring, fleeing predators and pursuing prey.[1] But mash that fact up with new technology that changes from week to week, and you end up with markets, and consumer behaviour, that are both strange and, at the same time, strangely familiar.

So it is with the rise of the largely male, largely affluent, largely thirtysomething[2] sports-shoe collectors known as sneakerheads.

Time was, you were looked on with pity if your parents couldn’t buy you new sports shoes. Not any more.

In July this year, Sotheby’s announced its stock of classic sneakers ‘available for immediate purchase.’ They included Nike SB Dunks, size 9½, for $90,000. Mid-1990s Apple Computer-branded shoes, size 10 ½, for $50,000. If you found those prices a bit steep there was an off-white pair of Nike Air Jordan 4 for a relatively affordable $2,200[3]. The catch was you needed size 4 feet for them to fit. But it goes way beyond a handful of niche auction houses: there’s now a whole global market for second-hand sports. It grew by 16.4% in 2022 alone, and hot $10.6 billion. By 2050 it’s predicted be worth over $50 billion[4].

The urge to collect things isn’t new. In ancient Babylon, in 500BC, there was a whole house given over to the display of a collection of Mesopotamian antiquities[5]. But for much of our history, collecting has tended to be a niche activity. So it was with sneakers. Or trainers if you’re English. Or gutties if you’re a Scot. Or tackies if you’re South African.

Sneaker collecting first took off as a thing in the late 1990s. It was the result of a convergence of different music and sports cultures. From black culture, basketball and breakdancing. From white West Coast culture, skateboarding. Shoes mattered to them all, and took on totemic value.

But it was only with the rise of the internet that the resale market really took off. Because with online marketplaces it suddenly became possible for anyone, anywhere, to buy the sneakers they’d always really wanted to own.

Those sneakers tended to be ‘classic’ rather than modern. Here’s why. If you were 25 in 2010, you would have been 12 in 1998. When you were young, it may be that your parents bought you new sports shoes. But the chances are those sneakers probably weren’t that year’s hottest release, the Nike Air Max Plus. But a lot of 12-year-olds knew cool kids or older kids who had them. A lot of them vowed that one day, they’d have them too. That day came with the rise of online marketplaces.

The feeling of acquiring a pair of shoes that you have been eyeing since you were just a kid is what makes sneaker collecting so special and nostalgic[6]. Prof. Thilo Kunkel

Not that sneakers are the only things from people’s formative years to enjoy an internet-driven value surge. Pokemon cards go for crazy figures nowadays. And there are online marketplaces now carrying listings for ‘vintage’ porn magazines. Some mags are selling for ten times or more over their cover prices.[7]

But when consumers spot an opportunity to meet their needs, so too do those looking to make a quick profit from them. In the sneaker markets, professional resellers have developed automated ‘sneakerbots’ to buy up desirable shoes within moments of them being listed, so they can ‘flip’ them at a profit.

Most of those shoes will never have been worn by their original purchaser, and are increasingly unlikely to ever be worn by any subsequent purchasers. This is because most resale sites only accept unused sneakers for sale, known as deadstock. This means that even if you can afford the shoes you want, the value of your investment will plummet if you should ever put them on.

The sneaker resale markets are generating billions of dollars every year. But there are question-marks over how sustainable they are, and how well they serve the needs of their customers. Because the more collectors are being milked for profit, the more they are being priced out, and the more resentment is growing against resellers and their sneakerbots[8].

So it’s worth looking at an alternative approach taken by eBay, the oldest online marketplace. With its share of the sneaker resale market under threat from newer, more specialist rivals, it sought a way to bring sneakerheads back and keep them on its side. It did this by looking for a way to show it understood their issues and frustrations – even if it meant taking a short-term profit hit.

Working with its PR agency, Edelman, the result was the Wear ‘Em Out Store, a pop-up store in Los Angeles. It offered some of the world’s most desirable sneakers at discounts of up to 70%.[9] But you had to be a human sneakerhead, not an automated sneakerbot. You had to turn up and buy them in person. And if you wanted the discount, you had to put them on, and walk over a series of in-store obstacles, and get the soles dirty, to render them no longer deadstock.[10]

This might have been considered sacrilege. It might have destroyed the shoes’ collectable value. Yet it got sneakerheads queueing round the block. And 99% opted to wear the shoes to get the discount. It meant they were unsellable on many sites – but they remained sellable on eBay, which has always accepted both new and used.

It was just three days. But it had deeper repercussions on sneakerheads’ perceptions, and on the brand. Not least of which was a 25% year-on-year increase in eBay’s sneaker sales revenue.

In many ways this story could never have come from any time other than our own, with its predatory sneakerbots, its pop-up store and its tribe of sneakerheads. Yet at the same time it illustrates some of the timeless fundamentals of effective marketing. Because effective, sustainable marketing is less about milking your customers for whatever you can get, and more about understanding what they want; what they need, and what stands in their way. And it’s about finding a fresh and ownable way to give it to them so that they think better of you and keep coming back for more.

[1] https://academic.oup.com/book/10966/chapter-abstract/159259907?redirectedFrom=fulltext

[2] https://www.retaildive.com/press-release/20230321-sneakerheads-are-driving-growth-of-athletic-footwear-market-yougov-repor/#:~:text=39%25%20of%20Sneakerheads%20are%20Millennials,particularly%20YouTube%2C%20Instagram%20and%20TikTok

[3] https://www.sothebys.com/en/articles/8-of-our-most-expensive-sneakers-to-buy-now

[4] https://www.marketdecipher.com/report/sneaker-resale-market

[5] https://museums.eu/highlight/details/105317/the-worlds-oldest-museums#:~:text=The%20oldest%20such%20museum%20in,while%20excavating%20a%20Babylonian%20palace.

[6] https://news.temple.edu/news/2023-04-03/how-michael-jordan-revolutionized-sneaker-industry-and-our-relationship-shoes

[7] Source: Boom Time for Retro Porn, Carole Midgley, The Times, 11th October 2023.

[8] https://www.ssense.com/en-gb/editorial/fashion/sneakerbots-the-ultimate-betrayal

[9] https://www.complex.com/sneakers/a/limairyaustrian/offset-ebay-wear-em-out-store-interview

[10] https://adage.com/creativity/work/ebay-wear-em-out-sneaker-store-sold-collectible-kicks-discount/2419206

First published by Warc.com on 25 July 2023.