Ince had no plans to wear the new Nikes. No, for the past two years, the 22-year-old basketball coach has been reselling the sneakers he waits for. And he thought he could double, triple, possibly even quadruple his money for this particular pair, getting anywhere between $500 and $900 for a sneaker that was selling for $250 retail.
“I’ve been here since Wednesday. I have to get it,” he said. “It’s going to be crazy in the morning.”
Ince thinks of himself as a small-time entrepreneur, but in reality he’s part of a complex, rubber-soled mini economy — one with “buyers, sellers, brokers, market-makers and third-party valuation services,” said Josh Luber, who founded Campless, a blog about sneaker data.
Luber, 36, understands this market better than anyone. Since 2012, he has compiled data on more than 13 million eBay auctions and posted his analysis on Campless, creating a price guide he calls the Kelley Blue Book of sneakers. The site tracks the prices of more than 1,100 pairs of collectible sneakers — that is, sneakers that sell on the secondary market above their primary market, or retail, price.
The markup can be astonishing. The average eBay price of the LeBron 10 What the MVP sneaker? $2,086. The Nike Air MAG Back to the Future? $5,718. How about the Air Yeezy 2 Red October, designed by Kanye West and released by Nike this year for $250 retail? It sold on eBay for an average price of $2,958, with almost two dozen people paying at least $8,000, Luber said.1
Luber — a fanatical sneaker collector himself, with 178 pairs on display in his home — says eBay’s sneaker business totaled $338 million in the last year, up 31 percent from the year before. Sneakers, he says, have become “boxes of cash” for many people. As soon as Foot Lockers across the country open each Saturday, thousands of pairs are on eBay.
None of this happens, of course, without the complicity of Nike, which is on track to hit $30 billion in sales this year. By inventing the concept of a limited sneaker, the company helped spawn a secondary market that puts money in the pockets of Ince and other investors.
It’s puzzling behavior for a money-making behemoth. So lately Luber has been fixated on a complicated question: Is Nike leaving money on the table — and giving up profits to the secondary market — by limiting the supply of certain lines of its sneakers? And if so, why?
by Lisa Chow, FiveThirtyEight | Read more:
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