Adidas ended its seven-year business partnership with Ye, formerly known as Kanye West, earlier this week. The effect is spilling over beyond the company into the fast-growing, profitable and broader sector of the sneaker resale market.
In this corner of the shopping world, sneakerheads, collectors and professional resellers buy and sell rare and in-demand shoes through online marketplaces such as StockX, GOAT and eBay. Cowan’s research shows that in North America alone, he has grown into a $4 billion-plus industry in recent years, and by 2030, globally, he could reach $30 billion. But the problem with large resellers in the industry is that the market is dominated by just his three brands. And one of them is Yeezy.
According to Cowan, Nike, Jordan Brand and Yeezy now account for more than 90% of sales in the resale market. With Adidas ending its partnership with Ye this week and announcing that it will no longer manufacture or sell Yeezy-branded merchandise, these online businesses aiming to satisfy every hypebeast’s cravings are staying loyal. You may suddenly have to look elsewhere to diversify your business. Customers who return to shop frequently. The hype associated with his new Yeezy release is less than it used to be, but future supply shortages could still leave a huge gap.
Dylan Dittrich, Head of Research at Altan Insights, which publishes information on collectible categories such as sneakers, watches and sports cards, said:
When Adidas announced on Oct. 25 that it was “immediately halting the adidas Yeezy business,” critics finally put kibosh on a partnership that should have happened sooner, from Yeezy sneaker and clothing sales. The profit reselling platform has made a decision. make. But their answer soon became clear. Aside from The RealReal, a smaller player in Yeezy’s resale space, his other online marketplace allows sellers to list his Yeezy products and buyers to buy them. But no one wanted to talk about the decision. StockX, GOAT and eBay did not respond to requests for interviews or comment.
The most popular product listings on these sites probably explain why.Eight of StockX’s top 12 best sellers were Yeezys on Thursday, and the site sold thousands of Yeezy Slide sandals in the past three days alone. was sold. Dittrich, head of research at Altan Insights, said the price of his Yeezy Boost 350 V2, arguably the most famous sneaker model in the Yeezy portfolio, went up 10-30% on StockX after Adidas’ announcement. said. Fans, collectors, and resellers seemed to be making a calculated bet that the lack of supply of his Yeezys in the future, whatever the controversy, would increase the value of the artist’s existing shoes. Since then, their prices have started to fall, but not below pre-demolition levels, Ditrich said.
Kola Tytler, who once helped run the Yeezy-centric Yeezy Mafia news site and is the founder of a Milan-based sneaker and streetwear reseller called Dropout, tells Recode that reseller owners across Europe are following this week’s hottest trends. He said he stocked up on Yeezy styles. “Because despite the controversy, it’s hard to see prices and demand drop significantly.” Visitors to Dropout’s e-commerce site, dropoutmilano.com, also saw a higher rate this week than before. Searching for
All of this sounds like a good thing for a shopping site catering to the needs of sneakerheads. Increased interest and higher prices usually lead to a significant reduction in sales for these companies. But what if there are fewer customers wanting to wear Ye-related fashion, or is it simply that supply is running low as the impact of Adidas not making new Yeezy merch is felt? ?
In announcing the dissolution, Adidas said it was “the sole owner of the existing products under the partnership and all design rights to the previous and new colorways.” A stock analyst said the company plans to produce his Yeezy designs under his Adidas brand name. These products are unlikely to have the resale value and hype they deserve without Yeezy’s name or involvement attached to them.
“It’s hard to see Adidas trying to emulate the success of YEEZY without Kanye,” Titler wrote in Recode.
Ye said it plans to sell a new sneaker design but will need a new partner, which could be a difficult task. He was escorted from Skechers headquarters on Wednesday after showing up “uninvited.”
Again, StockX and GOAT, founded in 2015, have been trying to diversify away from sneakers in recent years, even before the Yeezy debacle. StockX now has categories for trading cards, collectibles and accessories, in addition to sneakers, shoes and apparel. GOAT is early in its journey, and its parent company announced on Oct. 17 that it plans to acquire Grailed, a resale site known for non-sneaker fashion. But with both venture capital-backed privately held companies eyeing an eventual IPO for him, the competition to replace Yeezy could be very significant. In the meantime, they will get whatever sales and profits that come with the brand that they can still earn.