Digging in to the NBA's situation with China — again. I'm sorry.
|Oct 14||Public post|| 1|
Good morning, y’all! Thanks for getting your week started right here with me. I know Monday’s aren’t the most fun, but let’s make the best of this week.
Big shouts to Simone Biles who literally cemented herself as the greatest gymnast of all time. We stan.
Now, let’s get right to it.
The NBA’s sneaker culture and it’s big reckoning with China
(Gordon Hayward on a China tour via ANTA Instagram)
How wild is the world in 2019? Daryl Morey cost the NBA millions of dollars with a single tweet last week. The league is losing deals left and right and among them are, you guessed it, sneaker deals.
That’s a massive decision with far reaching implications — not only for the NBA as a company but for China’s shoe market, too.
For the NBA they’re losing access to a massive sneaker market that is absolutely in love with basketball, to put it mildly. If the league’s bottom line drop, this is part of the reason why.
For China’s sneaker brands like Anta, Li-Ning, Peak and others, they lose access to some of the most marketable athletes on the planet. Localeur CEO Joah Spearman said it perfectly.
Let’s take another step back, though. What about those players? These Chinese brands hav invested millions into a slew of NBA luminaries including big names like Dwyane Wade, Gordon Hayward and CJ McCollum. I don’t know if their deals are safe.
Hayward said he was told his relationship with Anta is remaining the same and I suspect that’ll be the case with many of those folks. But that’s subject to change — especially if the country’s government decides it’s truly serious about cutting ties with the league.
Plus, once the season starts and players have media availability, they’re bound to be asked about their business relationships in China. That can lead to a whole new mess.
It’s not just the Chinese brand players who are faced with this stuff, either. Did you hear James Harden last week? This is what he had to say about the situation, speaking for himself and Russell Westbrook.
“We apologize. You know, we love China. We love playing there…They show us the most important love.” James Harden to reporters on China.
That’s a man protecting an asset. And, oh, by the way, he’s signed with Adidas. Russell Westbrook? Jordan Brand. It’s not just a Chinese thing.
This is a reckoning. Everyone has been so busy making money in China, no one stopped to think about what the doing business with China actually means. Speaking out against the government is a no-no. If you can’t handle that, you can’t sign that deal.
The NBA and its players have to decide where they stand on that — even when it comes to sneakers. That’s not a bad thing. It’s something that probably should’ve happened sooner.
I just can’t wait until someone finally gets to ask LeBron James about this.
Speaking of China…
(A pair of Yeezys for sale via Poizon)
The country’s sneaker bubble is on the verge of bursting thanks to Chinese sneaker trading apps like Poizon and Nice, Qian Zhecheng of Sixth Tone writes. Think of them in the same way you would StockX.
They’re popular. In March, Poizon had 1.4 million active users and the company was valued at over $1 billion.
They’re useful too. China’s secondary sneaker market has exceeded $1 billion and has grown 35% year to year since 2015.
This is all well and good, right? There are a lot of people in China with a lot of love for sneakers. This kind of growth makes sense considering those factors.
But the market is volatile now thanks to the professional traders and finance workers taking a dip into the market. They’re loaded with cash and investing it into the rarest pairs, artificially inflating values across the board.
That’s an issue because their investments, in some cases, aren’t a true reflection of a sneaker’s actual value.
“After prices soared more than sevenfold to over 15,000 yuan per pair by mid-August, trading in the Air Jordans fluctuated wildly. On August 15, the price plunged from 15,188 yuan to 9,831 yuan on Nice [another trading app], before bouncing back to 15,008 yuan the next day. By August 17, the price was back down to 10,883 yuan,” Zhecheng writes.
Instead of getting something like a 400% return, investors are having to settle for something in the double or single digits. At some point, prices get so high that people don’t want to buy. That’s how the bubble bursts.
That sounds extremely familiar, right? Streetwear is in a similar place in the U.S. Investors are dumping money into streetwear brands that built value as times have changed, but people aren’t buying the same ways they used to. Sneakers are moving to a similar place globally.
Will this kill the shoe game? Absolutely not. People will always love sneakers and fashion. But things will change after the panic comes. The only question is how?
Sneaker IPO’s are wild…but I’m in
(Campus 80s Adidas via StockX)
We’ve definitely jumped the shark with the whole “sneakers as stock assets” thing, but I think this is a pretty cool evolution.
There are three pairs of Campus 80’s Adidas up for auction. If you want to cop, you enter whatever you’re willing to pay and hope you have one of the highest bids.
The number of winners is determined by how many shoes there are. Let’s say there are 20 pairs available. That means the 20 highest bid each win a pair.
The winners pay the clearing price for the shoe (aka the lowest winning bid). So if the highest winning bid was, maybe, $2,000 but the lowest was $250, each of the 20 winners would pay $250 for the shoe.
This pretty unprecedented stuff. Basically, StockX is partnering with Adidas to sell a limited edition shoe. I can’t recall a release like this before — feel free to let me know if you can.
The IPO saves us from the futility of entering a draw with 10 billion other people or watching bots cannibalize pairs through Adidas or SNKRs (ugh). I tell you my price and hopefully I win. If I don’t? Cool. I can live with that. But at least it’s in my control — or at least my wallet’s.
Let’s just hope there aren’t a bunch of you who bid $1 million thinking you’re going to get a low clearance price. Please, don’t be that person and ruin it for everyone.
Big, big, big shouts from the weekend
We love to celebrate excellence when it comes to sneakers here at the Kicks You Wear and, good Lord, Eluid Kipchoge and Brigid Kosgei were both very excellent this weekend.
Starting with Kipchoge, this man ran a marathon in 1:59:40. First of all, that’s wild. Second, and interestingly enough, the feat won’t be recognized as a world record because it was “assisted.”
Nike’s NEXT% shoe was part the reason why. It was built with a carbon fiber plate that reduced resistance during his run. Plus, he had a team of 41 pacesetters and an electric car guiding him on his pace to help him meet the mark.
But listen, I don’t really care. This is still dope as hell and an unbelievable feat no matter how it was accomplished. Salute to this man.
The same goes for Kosgei who actually won the Chicago marathon on Sunday with a 2:14:04 time. Same kind of badass deal here. I respect my GOATs.
Kosgei wore the same NEXT% Kipchoge did to break her record. This one actually counts, too.
These two were so impressive. I can’t even imagine running a marathon — let alone in two hours or so. It takes me that long to get out of bed sometimes (please don’t ask).
Both of them are Kenyan, by the way. Shoutout to it! 🇰🇪
What’s droppin’, bruh
Thanks so much for reading, y’all! Tell a friend to tell another friend about the Kicks You Wear!
Much love. Have a great week. See you Friday!