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Schlossman notes that the same thing happens to Supreme. Whenever the streetwear Adidas NMD Mujer Rosa brand releases
To get the newest Nike Roshe Run Womens Yeezys, customers also have to buy $500 worth of sweats. Is this how Kanye makes the resale market work for him?
On Tuesday afternoon, Victor Baez joined everyone else bum-rushing the Yeezy Supply site to buy Kanye West’s new Yeezy 500 “Desert Rats.” For Baez, who runs a sneaker-focused Youtube channel and has been reselling shoes for the past five years, a new Yeezy sneaker release means he’s furiously punching in his information and praying he can cop something. But on Tuesday, he hesitated, because the new sneakers—carrying a $200 price tag—were only available if you also bought a hoodie and sweatshorts, for a total price of $760. Baez clicked around, made sure there was no other way to buy the shoes, and proceeded with the typical song and dance: clicking purchase, and then immediately Nike Air Presto Womens listing the shoes on resale sites like Nike Air Max Command Womens Grailed and eBay. Baez was the first person to post the Yeezy 500 “Desert Rats” on either site. But what were they worth? He had just forked over $760, while Yeezy Supply had priced them at $200. Baez decided to ask for $1,899. “I set the market,” he tells me.
At first, the bundle didn’t even seem to cause a hiccup in the typical Yeezy cycle, as the shoes popped up from sellers like Baez for prices approaching $2,000 shortly after their release. But a full day later, the shoes were still sitting there. In fact, all the “Desert Rats” were sitting around on sites like Grailed and eBay. No one seemed to know how to value or how much to pay for a shoe that technically was worth $200, according to the price breakdown of the bundle on Yeezy Supply, but that you couldn’t actually get without paying Nike Air Max 2017 Dámské almost four times that. The bundling method seemed to be an attempt for Kanye and/or Adidas to get the full value out of these shoes—to receive a chunk of the money generated on the resale market. But did it work? And did Kanye figure out how to beat the resellers in the process?
That the resellers are winning at all is an interesting bug in the sneaker world. Kanye’s Yeezys are incredibly hyped shoes that often sell out in a blink of an eye, aggravating empty-handed customers and enriching those who manage to buy them. The sneakers are made in very limited amounts—only 40,000 pairs a release, Kanye said last year—and sell for multiples of the retail price once they hit the aftermarket. This means that the Yeezy economy is patently unfair to the supplier, whether it’s Adidas or Kanye West himself: the figure resellers charge Adidas ZX 750 Mujer is several times larger than Adidas or Kanye can reasonably get away with in the first place, even if that’s what customers are willing to pay. But this new bundling method forces customers to buy sneakers and apparel—and theoretically captures some of that aftermarket revenue in the process.
It’s estimated by StockX that over $6 billion globally is spent annually in the secondhand sneaker market—that’s money that slips right through the hands of Kanye and adidas and into the bank accounts of the luckiest customers-turned-resellers. “All the value in the product and what things are actually worth, they don't see any of it,” Lawrence Schlossman, Grailed’s brand director, tells me, referring to the initial retailers. “I wouldn't be surprised if they were like, We need to get a bigger piece of the Nike Air Max 90 Dámské pie. Why should we be hung out to Nike Air Max 2016 Dámské dry?” Schlossman notes that the same thing happens to Supreme. Whenever the streetwear brand releases a box logo hoodie, it’s enriching the collective resellers more than itself. Kanye, it seems, is simply searching for a way to get something closer to true market value for his prized sneakers. Josh Luber, the CEO of StockX, which treats sneakers like financial investments, appreciates the strategy. “I'm all about ways to create equitable distribution for everyone who's in the value chain to realize some of that value without adidas selling a Yeezy for $1200,” he says. And countless people have paid $760 for a Yeezy shoe before—someone bought a pair of black Yeezy 350s for $900 just today, according to StockX data. There seems to be no question that the sneaker market values Yeezys at more than Nike Air Max 2017 Femme $200 a pair. Now, West has found Nike Air Max 1 Femme a way to charge that amount.
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Luber also says the strategy ensures the halo effect these limited items are meant to create. “It's about, How do we leverage this to sell more products?” he says. “And this is a pretty explicit, in-your-face way to do it.” This may even inflate—or crater values if these shoes fail to fully sell out—the cost, as sellers refuse to let go of them for anything less than the $760 bundle price they had to front. “You have to look at this shoe as if it were sold at retail for whatever the cost of the bundle is,” Schlossman says. You see that reflected in the way people are pricing the shoes on resell sites—for double what