The Global Sneaker Market

The global sneaker market was valued at approximately$79 billion in 2020 and is predicted to reach $120 billion by 2026. Richard Xia, co-founder of Novelship, tells Augustman how we can navigate these streets

Jonathan Ho

SNEAKERS, ONCE A SYMBOL OF ATHLETICISM, have transcended their primary function. At some point decades just after the world started paying attention to what Michael Jordan wore to his basketball games, sneakers became a $79 billion industry and a fashion symbol of our time.

From sportswear to couture houses, sneakers have not only made their mark as cultural commodities but also literal ones. In July 2020, right at a peak of a global pandemic, an online prize draw was held to decide which lucky few would win the privilege of spending US$2,000 on the latest Air Dior trainers. A couture house was releasing a pair of sneakers, the world's most expensive at the time, during an economic “pause caused by the cessation of global trade resulting from COVID-19. The Air Jordan is considered the Rosetta Stone of sneaker history, catching that transcendental moment of athletic greatness in the 1980s boosted by Jordan's gravity-defying stunts on the courts while debuting Nike's “Air-Sole” technology. Sure, they inspired amateur B-Ballers to His Airness' choice of athletic footwear but also inspire the luxury fashion industry? No one would have guessed.

Suffice it to say, Air Dior's hype was unexpected, not even by designer Kim Jones, who himself is an Air Jordan obsessive, owning over 40 pairs. Then, 1 July came and went, and the “Wolf Grey Air Jordans with Dior's own distinctive oblique logo overlaid on the iconic swoosh, sold out in seconds. The first luxury link-up in the Air Jordan's 35-year history fundamentally altered the sneaker landscape hitting highs of US$28,000 on StockX. Though auction prices have fallen to more manageable levels, they're still north of five figures. Augustman spoke to Richard Xia, CEO and co-founder of Novelship, a trading platform that solves problems (namely availability and authenticity) with buying and selling sneakers and streetwear, on a new development that some have dubbed Sneakernomics.

Sneakers have become one of the hottest globally traded assets, on par with commodities like gold and coveted luxury products such as Hermès bags, how did this happen?

Sneakers as an investment asset is a global phenomenon, and as for the Asian market in particular, it is the fastest-growing. Personally, I feel that this is due to the rise of Gen Z and millennial consumers who are also more fashion-conscious and reaching their peak in terms of spending power, allowing them to afford exclusive products. Another thing that makes sneakers one of the hottest traded assets, is that sneakers are a catch-all - they have a great aesthetic, very comfortable to wear and flexible.

Something like a pair of Dior Jordans can sell for up to US$10,000, and it was previously as high as $28,000. Are there market fundamentals to this sort of stratospheric valuations or is it purely consumer sentiment?