What’s the most desirable shoe in the sneakerhead world? Until this year, that was a matter of speculation, but with the launch of Campless last fall, it became a matter of fact.
Campless is the brainchild of self-professed sneakerhead and data nerd Josh Luber, who began compiling and analyzing eBay sales results related to the secondary sneaker market, then presented his findings in a blog.
In the past year, Campless has expanded into a full website and a mobile app — all without a full-time staff. Luber still works his day job with IBM and operates Campless with 10 volunteers.
And the shoe world has taken notice. Luber told Footwear News that he has been approached by top athletic brands, retailers, sneaker blogs and even investment firms to discuss possible uses for his research. And in the coming months, he expects to sign a deal, though with who and in what capacity is still unclear.
“Campless is completely unique from anything that’s out there in the market,” he explained. “We occupy a space that no one else is [in], which can either be a really good thing or a really bad thing. As a result, everybody sees something a little bit different in why they might want to talk to us.”
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Here, the entrepreneur weighs in on his most surprising data revelation so far, sneakerheads’ egos and how Nike benefits from eBay.
What’s the most interesting thing you’ve learned about the secondary market?
JL: There is a general perception around most of the sneakerhead community that eBay prices are too expensive. [People will] say, “This is wrong. It says here, sneaker X has an average price of $300, but show me where you can get it for $300 on eBay. Nobody’s selling it for less than $450.” So I went back into the data to figure out whether I’m doing something wrong. What we found is that there are a lot of really good deals on eBay. But if a good deal shows up there, it disappears instantly. What sits on eBay for days are people who overpriced their sneakers.
Nike and Jordan are clearly the dominant brands among sneakerheads. Why is that?
JL: You can’t replicate Michael Jordan. He is the unquestioned father of the sneakerhead community. When you combine that with the 30 years of experience that Nike and the Jordan brand have at selling sneakers and understanding how to manipulate supply to prop up the secondary market, you see why they dominate that landscape. They absolutely create the secondary market. Nike won’t talk about it. They have this sort of willful blindness policy toward the secondary market and never openly address it, but their actions create it. They know exactly how many sneakers to produce so there will be just less than demand, so people will continue to buy and sell on the secondary market.
Can other labels challenge them?
JL: Other brands are starting to understand the importance of this community. Brands like Asics, New Balance, Adidas and Reebok are trying to do a couple of shoes a year, but that’s not their bread and butter, that limited-release sneaker. I don’t think they have as much invested in it and as much history behind it. And then you look at [the fact that] the core of the sneaker community is basketball, and when Nike has the three biggest NBA players in the world, in LeBron James and Kobe Bryant and Kevin Durant, that helps, too. Something like 95 percent of the dollars on the secondary market are for Nike or Jordan.
Does Nike see much benefit from the secondary market?
JL: Nike doesn’t make its money from [selling $200 shoes to] sneakerheads. It makes the real money by selling sneakers to millions of people for $50. But the reason that person chooses Nike or Jordan brand — instead of New Balance or Asics, which has the exact same price point — is that they’re buying the brand cachet: the marketing, the hype, the PR, all the things that come as a result of the sneakerhead community. We figured out that the secondary market was about $1 billion over the past 12 months, and of that about $300 million is profit, meaning dollars above retail price. Is this money that [Nike] could be capturing as part of the market? You could say that’s a marketing expense.
How important are sneakerheads in the athletic world?
JL: There have been people who feel that the sneakerheads are not as influential outside their little bubble as they think they are. And to some extent that’s right. When you look at the other brands, what do they have on Campless? Out of the 1,100 sneakers we have, Adidas has 12 sneakers. Adidas is a big company and doesn’t rely on sneakerheads to sell its shoes. It’s not unlike the Apple fan boys, who stand in line for days to get the new Apple iPhone. They have a place, to create media excitement and the stories around it. And in certain demographics and types of sneakers, [sneakerheads] are very, very important.