24.01.2024
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The collectible sneaker market has evolved beyond a niche interest to become a major investment category. This growth is largely driven by powerhouse brands like Nike and Adidas, particularly through their highly sought-after limited-edition collaborations. These sneakers are not only lauded for their design and cultural significance but also treasured for their rarity and the unique stories they embody.
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This piece is a part of our Timeless Guide series, aimed at offering insights into the luxury investment market. You can find other articles from the series here.
Air Jordan 1 Family PE ‘Iridescent’
Market value is 13% above our drop price
Investing in collectible sneakers offers a unique blend of tangible asset value and cultural significance. With the sneaker resale market projected to hit USD 30 billion by 2030, it’s a dynamic and potentially lucrative investment alternative. The appeal of these collectibles lies in their rarity, brand heritage, cultural impact, and worldwide collector demand, which drive their value appreciation.
The secondary market, featuring platforms like StockX and GdOAT, is a testament to this growth. In 2020, StockX alone facilitated 7.5 million trades worth USD 1.8 billion, with rare sneakers like the Nike MAG Back to the Future selling on the platform for a record USD 65,000.
Overall, collectible sneakers have become a symbol of modern culture and investment savvy. They offer investors a chance to diversify their portfolios with an asset that blends contemporary cultural relevance with financial promise, appealing especially to younger, trend-conscious investors. Although it is difficult to predict exact market trends, going with rare editions from big brands like Nike and Adidas seems to be a safe bet. They also frequently release limited editions, some of which, like the Air Yeezy 2 Red October, have seen over 2000% returns.
Sneakers created as a result of collaborations and partnerships are at the top of the resale market. For example, shoes created as a result of Nike’s long standing collaboration with Michael Jordan, dominate the list of the most expensive sneakers ever sold. With the esteemed auction house Sotheby’s even entering into the world of sneaker auctions with Nike Air Ships (precursor to the Air Jordan model) worn by Michael Jordan in 1984 which sold for USD 1.47 million. The record sale of Kanye West’s ‘Grammy Worn’ Nike Air Yeezy shoes for USD 1.8 million in 2021, further underscores the potential of these collaborations in the market. A market that not only promises financial returns but also represents a shift in investment trends, where cultural value and rarity have become key determinants of an asset’s worth.
Between 2022 and this year, the collectible sneaker market experienced substantial growth and diversification. In 2022, the resale market was predominantly driven by online marketplaces, contributing USD 5.3 billion. Consignments also played a significant role, being 25% of the entire sneaker resale market and generating USD 2.7 billion in 2022. It was also in 2022, that the market demographic shifted notably, with men’s participation decreasing from 98.4% in 2014 to 57.3% in 2022, highlighting an increasing interest among women. The majority of the market is now dominated by millennials, representing around 80% of the resale consumer base.
Regionally, North America, especially the United States, emerged as the largest market, ending 2023 with a USD 2 billion total revenue. The global market landscape is further enriched by contributions from Europe, Asia Pacific, Latin America, and the Middle East and Africa.
In 2023, the market witnessed a large number of strategic alliances and partnerships. For instance, Tiffany & Co.’s collaboration with Nike and the viral Wales Bonner X Adidas sambas.
Last year also saw some of the most significant sneaker auctions to date. The most impressive sale was that of a pair of game-worn Air Jordan 13 ‘Last Dance’ sneakers, known for their connection to Michael Jordan’s last game with the Chicago Bulls during the 1998 NBA finals. These sneakers, originally priced at USD 150, were auctioned for a monumental USD 2.2 million, setting a record for the most expensive sports shoes sold at auction to date. This sale underscored the enduring appeal and significant value of sneakers associated with iconic sports moments and figures.
Nike Air Jordan 1 Craig Sager
Market value is 16,6% above our drop price
The collectible sneakers market is a dynamic and ever-evolving segment, rich with a variety of styles, collaborations, and limited-edition releases that attract collectors and fashion enthusiasts alike. To help you navigate this intricate market, we’ve identified key brands that dominate the scene, each offering distinct models that have carved a niche in the world of sneaker collecting:
Nike: A powerhouse in the sneaker world, Nike has been at the forefront of innovation and style. Among their most iconic collectible sneakers are the Air Jordans and Air Force models. Air Jordans, born from the collaboration with basketball legend Michael Jordan, have transcended their basketball roots to become a cultural symbol. This model still accounts for a significant portion of Nike’s revenue. The Air Force line, especially the Air Force 1s, are celebrated for their classic design and have become a staple in streetwear fashion which has now been elevated through collaboration with the likes of Off-White and Louis Vuitton.
Adidas: Adidas has made a significant impact in the sneaker market, not just through its unique designs and collaborations, but also through its strategic business moves. The partnership with Kanye West in 2014, leading to the creation of the Adidas Yeezy line, has been a major factor in Adidas’s resurgence in the market. Adidas’s strategic approach involves creating limited releases and catering to the secondary market with products like the Yeezy Boost and NMDs. This has led to resell margins of up to 400% for some products, a testament to the brand’s growing appeal in the collectible sneaker segment. The success of models like the Superstars, the top-selling sneakers of 2016, and the recent viral waves made the samba model, also illustrate Adidas’s effective strategy.
Others: The collectible sneaker market is enriched by the contributions of various other noteworthy brands. Balenciaga, for instance, has seamlessly blended high-fashion with streetwear, elevating sneakers to luxury items. Remarkably, Balenciaga sneakers often command the highest resale prices, averaging around USD 699. Asics has distinguished itself with its performance-centric sneakers and innovative collaborations. Drew Haine, the merchandising director at StockX, has even pinpointed Asics as the brand most likely to expand its market share significantly. Alongside these, brands like New Balance also play a vital role, adding to the diverse landscape and ongoing evolution of the collectible sneakers sector.
Investing in sneakers as collectibles requires consideration of various factors that significantly impact their long-term value and potential for appreciation:
Investing in sneakers, with its potential for high returns, also involves a variety of risks and challenges. Key among these is the need for rigorous authentication as the sneaker market is rife with counterfeit products that can drastically reduce an investment’s worth. The condition of the sneakers, influenced by factors like wear and packaging, is also critical for maintaining their resale value. Investors must also negotiate the complexities of accessing limited and exclusive releases, a task often marred by high competition and limited availability.
At Timeless, we offer a solution to these challenges. Our team’s deep expertise in authentication and market dynamics ensures proficient handling of the complexities in this field.
Moreover, our fractional ownership model allows investors to partake in the world of rare sneakers, eliminating concerns over authentication, storage, and negotiation. This approach simplifies the investment process, making rare sneaker investments more accessible.
Explore our curated collection of sneakers to diversify and grow your portfolio.
The collectible sneaker market represents a dynamic investment landscape combining cultural significance with financial potential. Driven by brands like Nike and Adidas and underscored by strategic collaborations and limited editions, this market has witnessed significant growth and diversification.
The value of sneakers, as shown by soaring resale prices and auction records, is rooted in their rarity, cultural narratives, and historical importance. The sneaker market is poised for continued evolution, fueled by innovative collaborations and the enduring appeal of iconic brands and models. This market not only promises financial returns but also reflects the deepening intersection of fashion, culture, and investment, making it an attractive option for investors seeking to expand their portfolios.
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