Good morning, family! Welcome back to the Kicks You Wear! Thank you so much for rocking with me.
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Let the bounce back begin
(Photo by Smith Major on Unsplash)
2020 was an awful year with a lot of losses all around the sneaker industry because of the pandemic. 2021 seems to be off to a much better start.
Puma’s reported progress in their latest earnings call is the most recent example of a bounce back from one of the big wigs.
Their sales increased in the fourth quarter by 9%, per the NPD Group’s Matt Powell.
They still finished the year at a 1.4% loss behind the pandemic and are still feeling some of those effects. Half of their stores in Europe are still closed. But they expect steady continued improvements throughout the year.
This progress has been shared by some of their competitors.
Under Armour shares rose 8% a couple weeks ago back after they announced a new plan boosting direct-to-consumer sales in their Q4 earnings call.
Nike’s own DTC initiative spurred a 9% revenue growth year over year, per their Q2 earnings call.
Adidas’ Q3 earnings were down by 3% , per their call, but they’d beaten analyst expectations and anticipated growth in 2021 barring another COVID-19 surge.
These numbers are small and the margins are still razor thin, but things are on the up and up. And barring a huge COVID-19 surge, they’ll probably continue to grow.
Don’t get it twisted. That’s still a very real possibility. We’re not out of the woods with the pandemic yet. Cases have fallen, but that drop has paused and that pause has the CDC concerned, per NBC News. It’s taking time to get people vaccinated. People are still at risk. And, as long as there's risk, business will (rightfully) be slow.
There’s also consumer behavior. We don’t know how people will react when “outside” opens back up.
Will people still shop at brick and mortar stores? How many places have closed down because of this? Will the same hot shopping spots even exist?
Only time will give us the answers to that. Once we get them, the future will be a lot more clear.
A feature, not a bug
(Photo by Thomas Serer on Unsplash)
Bloomberg Magazine published an extensive piece about sneakers current existence as an asset meant to be flipped on the secondary market and how much money there circulating in it. You know, the usual.
What was interesting was the reseller the piece was centered around. It was Joe Hebert — you know him as West Coast Joe. He’s got warehouses filled with rare kicks for reselling.
That wasn’t the interesting part, though. Here’s the gem.
Turns out his mom is Ann Hebert, who is the Vice President and GM at Nike North America.
And it turns out that the American Express card that Joe is using for his reselling company, West Coast Streetwear, is in Ann’s name. Again, the VP of Nike North America.
It’s detailed in the piece.
“At one point in late June, after his trip, he’d phoned me, and the number was identified as belonging to Ann Hebert. I looked the name up and discovered there was an Ann Hebert who’d worked at Nike for 25 years and had recently been made its vice president and general manager for North America…Hebert later sent me a statement for an American Express corporate card for WCS LLC, to demonstrate West Coast Streetwear’s revenue, and it was in Ann’s name.”
And get this: Nike already knew. Bloomberg reached out to Hebert and Nike about it. But they determined there was no conflict of interest here…somehow.
“Ann Hebert didn’t reply to emailed questions; [Sandra] Carreon-John, the Nike spokesperson, says Ann disclosed relevant information about WCS LLC to Nike in 2018. “There was no violation of company policy, privileged information or conflicts of interest, nor is there any commercial affiliation between WCS LLC and Nike, including the direct buying or selling of Nike products,” she writes.”
This is just wild. There’s a conflict here — Ann's son is running an extensive resale operation while she implements Nike's direct-to-consuner strategy that fuels the resale culture her son profits off of.
But it’s also very clear that executives get to play by a different set of rules. And that, quite frankly, is bullshit. There’s absolutely no reason Hebert should be let off the hook for this.
The system is broken — we already know that. But here we see a high-level executive at the company that actually built the system contributing to breaking it. This is very clearly an exploitation. And there’s just no way of fixing that.
This needs to be completely rebuilt from the ground up. Unfortunately for us, that’s not happening. Ever.
Foot Locker’s follow-up
Over the summer after the killings of George Floyd, Breonna Taylor and other unarmed Black people sparked an uprising around the country, all of these big brands and companies pledged to do more in the community.
They promised to uplift Black lives and create more opportunities for upward mobility. I’ll be frank. Many of them haven’t quite backed that up. Some have, though!
Foot Locker is one of them. The company pledged to donate $200 million over the next 5 years toward economic development and educational initiatives empowering Black folks.
The company also promised transparency with their effort. And we’re getting it. They released their first report card last week.
The details:
FL made a $5 million investment in MaC Venture Capital, a Black-led VC firm.
It also has partnered with 34 new Black brands and creators for collaborations in 2021.
An additional $750,000 is being committed to scholarships and programs to help train the next generation of Black shoe designers.
This is a start. There’s still plenty more to go. And I’d love to see them taking more action on a grassroots level outside of funding creatives and designers. Hopefully, that comes down the line.
Regardless of what the future holds, it’s great to see this level of transparency and accountability coming from a brand fueled by the Black dollar. More, please.
SPECIAL DELIVERY!
Black History Month might be over, but y’all know we celebrate Black culture here all year long. We did two BHM episodes of Special Delivery last month that I’m incredibly proud of.
First: We had Devin Allen on the show to talk about his BHM pack with Under Armour.
Second: We also talked about New Balance’s My Story Matters pack and its inspiration. New Balance sent us a WHOLE BIBLE, y’all.
Hope y’all enjoy these as much as I did.
What’s droppin, bruh?
Adidas Forum Mid — Monday, March 1
Air Max 90 “Valentine’s Day” — Wednesday, March 3
Nike Dunk Low “City Market” — Thursday, March 4
New Balance “Casablanca” 327 — Friday, March 5
Jordan 1 “University Blue” — Saturday, March 6
Yeezy 450 Cloud White — Thursday, March 4
Thank y’all so much for rocking with me! Remember, do that survey! Let’s make KYW as great as possible.
Alright, y’all. Peace. Be safe. Be easy. Be kind. Peace and love.
Signing off.
—Sykes 💯
Great read!