The sneaker business is booming, with the global market predicted to reach $120 billion by 2026, having been valued at $80 billion in 2020.
Gone are the days of wearing sneakers until they fall apart, in the last decade there has been a notable shift in how sneakers are worn and perceived. The shoes have become coveted fashion objects, no longer seen as too informal for a work setting. Now they are a symbol of wealth, and a major contributor to footwear’s pole position as the biggest-selling category in the online luxury market.
In this episode of The Exchange, Euronews investigates the everchanging world of sneakers and the latest trends in the market.
Who sets the trends?
According to footwear retailers, it is young people who determine the direction of ‘sneaker culture’, creating an ever-evolving market that needs to grow with the customer.
Susie Kuhn, the Europe, Middle East and Africa President of Foot Locker, told Euronews that big retailers are tracking changing tastes and trends to ensure that young people stay engaged.
Not so Shabby Chic: The Growth of Luxury Consignment Stores
The resale market, where collectors or “sneakerheads” put their limited-edition shoes on sale, is a key pillar of the sneaker industry, representing around $6 billion globally.
This has given rise to a new niche in the market; premium sneaker consignment stores, which sell collectable sneakers on behalf of their owners for commission.
One such business is Presentedby, who claims it “represents a refined regeneration of sneaker and streetwear culture” in a world where “Streetwear is a new luxury”.
Presentedby has stores in London, Paris, Dubai, Doha and Riyadh, each designed to look more like a temple to sneakers than a normal shoe shop.
At the Doha store, a pair of sneakers could cost between $2,000 to $50,000, with exclusive pairs like the Dior Air Jordans fetching even more.
How does the resale sneaker market work?
CEO Ridwane Ettoubi launched Presentedby in 2017 to cater to the growing community of sneaker enthusiasts in the UK who are attracted by the chance of owning limited-edition shoes.
Ettoubi told Euronews that if you know what you are doing, you can buy a pair of sneakers at retail for $120 and on the same day sell them on the resale market for $400.
Sounds easy enough. But Presentedby’s CEO said that to be profitable on the resale market involves certain skills.
Ettoubi added that availability is a key factor in choosing valuable sneakers, as the “limited run” will push prices up.
“So is it a luxury brand that’s collaborated with a sports brand? Is it the first time that they’ve collaborated? Is it the designer that’s involved? Just like in stocks and shares, these items fluctuate in price” he added.
A sneaker stock exchange?
It may seem strange to compare sneaker resale to stocks and shares, but a former NFL athlete has turned the idea into a reality, creating an investment platform for shoes.
Gerome Sapp created RARES to allow people to invest in collectible sneakers much like they could with commodities like gold.
For Sapp, the idea behind RARES was to create an investment platform which is more relatable to Gen-Z and millennials than other exchange markets.
The RARES CEO told Euronews that young people “relate more to sneakers” than traditional commodities like gold, adding that “now you can diversify your investment portfolio into something that not only is cool, but also it’s something that makes you money.”
Indeed, data from StockX indicates that investing in sneakers provides a better average annual return than other assets such as crude oil and gold.
A fresh take on “sneakerhead” culture, Gerome Sapp has opened up a new avenue for young people to get involved in the financial market, while also pursuing their passion for shoes.
These recent innovations in the luxury goods market have elevated the humble sneaker to a position of power, not to be looked down upon.