The consequences of scaling up sneaker culture

StockX EC-1 Part 4: Future and impact

StockX’s mission is “to provide access to the world’s most coveted items in the smartest way possible.” It says it right on the website, and it’s incontestable that the infinite data StockX makes transparent to anyone for free allows for smart participation in the business of sneakers.

But, smartest participation by whom?

As the business of sneakers commoditized alongside the boom of social media, plenty of the culture’s stories went largely overlooked by hype-pedaling media outlets and social media algorithms in addition to the influx of people with little familiarity or exposure to sneaker culture.

We often see “access” leveraged as marketing jargon, or the concept of democratization applied to opening up once exclusive spaces, which have often excluded marginalized communities. It’s become trendy to advertise the concepts of representation and inclusivity without actually doing the work internally: Adidas’ campaign imagery featuring a diverse set of models was released at the same time the company was under fire for overt racism and discriminatory hiring practices.

“Smartest” could be exchanged for “simplest” or at least used in tandem for a more accurate description. There’s no need to be educated on the shoes’ functionality, what replicas may look like, or even the story behind them or their history of releases and rereleases. StockX’s data offers education on the market. Access is granted to any person to easily make a financially smart purchase as long as they have an internet connection and the funds.

While StockX’s idea of access does circumvent gatekeeping and the backdoor deals of the past to an extent, it has come at the cost of having access taken from vibrant regions, brick-and-mortar stores and small businesses to those with more capital. In short, the access afforded to the most coveted items is a premium pass rather than democratization.

Users’ love/hate relationship with StockX

Andrew Zachau decided to sell off his sneaker collection around 2011 while he was in college. At the time, eBay was the best option, and he had to do quite a bit of legwork to price his pairs without any centralized data on the secondary sneaker market.

“I would have to go research the shoe on eBay to see how much people wanted for it and see what the shoe sold for by going through all of the closed auctions, and that’s how I generated the price. StockX definitely makes it a lot easier.”

The now 27-year-old, Chicago-based reseller still primarily operates on eBay because of the years he put into building his seller reputation on the platform. “If I’m looking to sell something on eBay, I go over to StockX, check the market price and list mine within that range.”

Although he never buys on StockX — he doesn’t want to pay retail nor depend on the company’s authentication services — Zachau recognizes the value the platform offers him. “Before [StockX], sneaker reselling was really like the Wild West. People would charge whatever they want and there was no reference point.” Looking back, he says, “If I was negotiating with someone and looking to buy a pair of shoes that they wanted $450 for, back in the day I couldn’t go to StockX and say, ‘Well, they have it for $350.’”

On the other hand, he has used StockX to sell on occasion. When he wants to offload a pair of shoes quickly, StockX’s model of users listing their bids (buyers) and their asks (sellers) enables speed. The buyers are essentially there waiting to be chosen. “It’s one click and right out the door.”

StockX’s interface allows for extremely easy one-click buying and selling of sneakers, such as this Jordan 12 Retro Low Easter (2021). Image Credits: StockX

Despite recognizing the obvious opportunities the growth of the business of sneakers has afforded him, Zachau, like many other enthusiasts who have been into sneakers well before StockX, expressed the negative implications of its dominance in the market. “Because StockX made it so easy to resell shoes, anyone can do it. You don’t have to have any interest in sneakers. You can look up that shoe on StockX, see its resale value [and] go after that shoe on release day. You could have no idea what it really is or anything about it,” he laments.

The option to buy or sell in one click plus the combination of authentication, real-time pricing, data transparency as well as transaction anonymity affords a low-risk, easy entry point into the secondary sneaker market that did not exist pre-StockX. Yet, popularizing the sneaker space and enabling little to no effort for access also dilutes the culture of sneakers.

Sneaker culture, gentrified

In 2019, Business Insider profiled a 15-year-old who financed his sneaker-selling business with the money he made doing yard work. He’s since quit playing sports to focus on school and building his business. He raked in six figures last year.

In the story, he said, “Everyone wants shoes, and there’s always someone who will spend an absurd amount, so it’s just about getting those pairs and building the right connections and understanding the market.” He plans on netting enough savings to eventually transfer his network and financial skills to real estate.

Such seemingly feel-good tales of young entrepreneurship — the new paper route, if you will — are rife and have also fueled scandal in the industry. Nineteen-year-old Joe Hebert built a $200,000-monthly-revenue sneaker-reselling business, even hitting sales of $600,000 in May of 2020, as described in a profile by Bloomberg Businessweek. All of the math in the Bloomberg story was impressive until it was revealed Hebert was leveraging access to discounted shoes via his mother Ann Hebert, who had a 25-year tenure with Nike and was most recently vice president and general manager of Nike North America. Industry critics also questioned whether her senior position offered her son easier access to limited-edition products, and her Nike affiliation went largely without consequence until the story was published. She stepped down from her position in the resulting furor.

Hype sneaker culture as we know it today originates from storytellers of hip-hop and Nike and Michael Jordan’s Air Jordan 1. Nearly 40 years and billions of dollars later, sneaker culture has evolved, and what sneakers represent now is vastly different than that of the mid-1980s.

“The biggest difference is that shoes used to be a signifier. They still are, but in a different way. You used to be able to tell exactly what was up with a person by knowing what type of shoes they like,” Jazerai Allen-Lord, founder of the branding agency True To Size, says. She has touched nearly every facet of the sneaker market, from running social media at in 2015 to her work executing New Balance’s Black History Month brand activation with Kawhi Leonard. She even has her own sneaker with Reebok. (Yes, it sold out, and it’s only available for resale.)

Jazerai Allen-Lord has touched nearly every facet of the sneaker market in her creative work. Image Credits: Jazerai Allen-Lord

“Having Off-White sneakers, that’s a signifier that you’re affluent, that you have status. That’s no longer about the story that you’re telling in the world,” she explains. That little orange zip tie says someone has access — whether it’s to a plug or money to buy at resale value — and essentially nothing else about the wearer.

Nike x Off-White Rubber Dunk, which today have an average sale price on StockX of $345. Image Credits: Nike

Through the lens of a sneaker enthusiast, shoes told the wearers` story before Instagram diluted regional sneaker trends into one homogeneous look. “If you liked New Balance, you typically liked all runners and were a potential part of the ‘trainer community’ aka the U.K. running shoe addicts. This would also encompass Asics, the Air Max family, Diadora, Saucony, etc. Jordan heads were exactly that, and sometimes they only wore Jordan retros, 1-13,” she offers as an example.

Being from Southern California, Allen-Lord has always been into Nike SB Dunks. “Before 2010, the SB community was its own community, typically connecting over the thorough storytelling and multifaceted elements of skate culture. You could even tell how long someone has been collecting SBs by the box colors in their photos,” she says.

“If you liked SBs, you typically appreciated underground hip-hop — since those were a majority of the collabs — you had a wide range of sneakers, outside of just JB [Jordan Brand], and appreciated the details of a great sneaker story i.e., materials, packaging and beyond.” Her connection to the shoes is vastly different than a kid whose first introduction is seeing them on Travis Scott or Kylie Jenner’s Instagram in 2020 and heading directly to StockX to try to cop a pair.

Reebok Jazerai x Club C 85 shoes. Image Credits: Jazerai Allen-Lord/Reebok.

A woman’s place is wherever the hell she wants to be

Much like other male-dominated spaces, including women is frequently overlooked or simply considered a puzzle for someone else to solve. The sneaker industry is no exception. Even with data on women’s interest in sneakers trending upward from the inception of the platform, in 2018 former StockX CEO Josh Luber told women’s sneaker and streetwear blog The Snobette, “A women’s-only launch is an intriguing idea. However, it’s difficult to imagine how this would work, in practice,” and this was an entire year after Jordan Brand launched their women’s division. Women’s-only releases are becoming a norm for brands, but outside of those brands, they still aren’t totally accepted or understood.

Reconciling gender disparity in the sneaker space isn’t a new concept, at all. Nike started to pursue female shoppers in the ‘90s, and Reebok found much success targeting women via fitness (namely aerobics) and workout style in the 1980s. Yet, it wasn’t until after Nike released their award-winning “Dream Crazier” ad in 2019 that the company introduced a new maternity policy guaranteeing the pay and bonuses for their endorsed women’s athletes, which was triggered after much public outcry.

StockX can clearly exhibit the numbers behind the demand of women’s products as their transactions have grown 1,500% since 2016. While this is an invaluable number for the manufacturers to see, it isn’t a reflection of anything StockX has contributed to sneaker culture. Instead, high demand has been generated by an underserved community finally getting access to products made for them.

In that 2018 interview, Luber also went on to share that it wasn’t clear that any of the major brands had figured out how to market to women. Interestingly, this apparent lack of understanding women consumers reaches beyond the foundation of StockX and the brands in 2018 and even now. It’s this disinterested mindset that resulted in media brand Hypebeast creating Hypebae: They couldn’t figure out how to include women’s stories on Hypebeast. With the historical lack of storytelling and recognition of women in sneakers and women’s specific sneaker products by brands and large sneaker-focused media companies alike, it comes as no surprise that Hypebeast wrote about a womens-only release in December of 2020 and called it “unfortunate.”

Exclusivity is part of sneaker culture

As the business of sneakers commoditized alongside the boom of social media, plenty of the culture’s stories went largely overlooked by hype-pedaling media outlets and social media algorithms in addition to the influx of people with little familiarity or exposure to sneaker culture.

There’s obvious objections by OG sneaker purists, like Complex Media’s Angel Diaz who wrote that the gentrification of sneakers is killing the culture in 2018. And, within the same paragraph where he points out, “Lines around the block are filled with people who have no intentions of wearing the sneakers they’ve been sleeping in tents for,” he offers up how Complex’s coverage is also complicit in the changing tenor of the community.

Customers wait in line in an attempt to purchase limited-edition Air Jordan IV sneakers outside the Levi’s store in the SoHo neighborhood, January 16, 2018 in New York City. Image Credits: Drew Angerer/Getty Images

While media in general may have evolved beyond the boom of listicles in exchange for clicks in 2015, sneaker-centered media has little incentive to diversify coverage, particularly with the introduction of real-time stock tickers to report on to a growing base. Three of Complex Media’s most popular sneaker content offerings — YouTube shows “Full Sized Run” and “Sneaker Shopping” as well as their podcast — feature a combination of the same three individuals as hosts when there are only four permanent hosts in total. Three white male 30-somethings monopolize the perspective served to Complex’s substantial base of subscribers.

StockX does, however, acknowledge its place in the sneaker and streetwear community. Though there isn’t an authority in the media space holding them responsible to do more, the company has said that it’s important to propel stories of the surrounding communities’ founders forward with its platform.

“We’ve been kind of uniquely poised to provide benefit to those people simply by existing, but also recognizing that they were here long before we [StockX] were, and they knew the space a lot better than we have over a certain amount of time,” VP of Global Cultural Marketing Tom Woodger points out. “We always make sure that we are paying homage from a cultural perspective and providing the reach of our platform back to these people that were at the very beginning of sneaker culture.”

Woodger points to partnerships with Chris Gibbs from Los Angeles’ Union LA as well as designers Melody Ehsani and Angelo Baque of Awake NY. “It’s not just simply StockX as this big new sneaker platform, but it’s always about paying respect back to the creator and putting them at the forefront by being able to provide all the benefits that we now have back to them, almost as a thank you.”

A culture of numbers and dollar signs

StockX might try to pay homage, but it also acts as a bridge to the tech scene or to those focused on investments and assets. “Whether you’re a hedge fund person that understands the value of assets and you look at sneakers as a new asset class or trading cards or things like that. That’s an entirely new proposition,” Woodger says. “Then you look at the other things that we’re doing around product authentication and movements forward there and how that applies to different audiences. StockX has become relevant to all of these different entities.”

The platform has progressed from merely centralizing and providing information in an insider-only, disjointed sneaker and streetwear world to a multibillion-dollar company fueling an even larger ecosystem with ease and all the data to prove its worth — and not even a global pandemic could slow it down.

StockX’s homepage features a stock ticker of the latest moves in sneaker prices. Image Credits: StockX

Interestingly, in all of the promotion of transparency and democratization by StockX, the concept of community and the actual sneaker community itself is not part of the equation. In a literal sense, users shopping on the site or app will see little to nothing about the storytelling element of sneaker culture without searching for it — it’s purely numbers and dollar signs.

Access, sure. But, at what cost? The stock market of things is the capitalist result of ensuring easy access to anyone — even if they’re fueled more by the glamorization of acquiring products in high demand at any cost, instead of a sincere adoration for sneakers and an appreciation for the stories that come with them.

Democratization, representation and access are paramount when it is authentic and an integral part of an ongoing plan. StockX recognizes this. However, by only allowing deadstock (unworn), brand-new sneakers with their original packaging, their “best” customers are those actively participating in buying and selling deadstock sneakers as assets within the stock market model, not the Penny Hardaway-obsessed collector nor the person who actually wears their shoes, and this definitely leaves an opportunity of amplifying those untold stories on the table.

By cementing its place as a substantial stakeholder in a wider sneaker ecosystem prioritizing assets over culture, the story of StockX is really just the next chapter in the book of tech as convenience reigns supreme. The history, the geographies, the depth and the stories of this culture are effaced to make it cleaner and simpler and ready for purchase. Relationships and communities are replaced by UX, and the meaning of a pair of sneakers is reduced to a data point on a stock ticker. Change is inevitable, particularly in relation to exponential growth parallel to our evolution with the worldwide connectedness of social media, but we’re still early enough in the game to ensure progress doesn’t look strictly like gentrification — especially for such a smart and successful startup.

In this EC-1, we’ve examined the genius behind applying the concept of a free market to a subculture with beginnings in sneakers Michael Jordan was “banned” from wearing in the NBA all the way to this year’s historic presidential inauguration. A perfect storm of “likes” and hype, application of Econ 101 lessons and a black market round out an ecosystem that StockX has (and freely offers) all of the keys to.

StockX EC-1 Table of Contents

Also check out other EC-1s on Extra Crunch.

Updated April 5, 2021: Updated Andrew Zachau’s name.