Shoppers are now willing to drop hundreds of dollars on sneakers — and they might need to spend even more in the future

Shoshy Ciment and Irene Jiang / Business Insider

Sneakers can fetch a hefty price nowadays.
Athletic shoes have long been popular, but it’s taken a few distinct trends to get to the point where people will drop hundreds — or even thousands — of dollars on these shoes.
Celebrity collaborations, an increasingly casual culture, and savvy shoe releases have all pumped up the demand for elite, high-quality sneakers.
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Sneakers are big business, and consumers don’t appear to be kicking that trend to the curb anytime soon.

Whether they’re on the auction block, in the store, or in the hands of resellers, sneakers can fetch some striking sums. Classic Air Jordans can still go for up to $2,000. A Canadian investor shelled out $437,500 for a pair of rare Nike Waffle Racing Flat "Moon Shoes" earlier this month.

And the hype is still intense, too. Sneakers have become the "ultimate status symbol" in Silicon Valley. An exclusive collaboration between Arizona Iced Tea and Adidas selling for $0.99 recently resulted in violence and mayhem in New York City, as a mob scrambled to get its hands on the shoe.

Business Insider spoke with a number of industry experts to get a sense of why shoppers are dropping hundreds of dollars on a new pair of shoes. Shoemakers’ buzzy releases, the rise of sneaker culture, and the mainstreaming of casual dress were each cited as factors in the rising cost of sneakers.

But, ultimately, consumers’ willingness to splurge on athletic shoes that they view as good investments or bold statement pieces has allowed footwear companies to invest resources in increasingly luxurious, technologically advanced, and celebrity-backed products.

The rising cost of sneakers is less of a supply-side phenomenon and more of a demand-fueled business, according to ESPN NBA feature writer Nick DePaula, who’s also the creative director at Nice Kicks, a sneaker-focused media outlet. DePaula says that the upward trajectory of sneaker prices has been helped along by rising interest in athletic shoes across society.

"When I was growing up in the ’90s, it was really fueled by your favorite players and the performance of the shoe," he said. "And now it’s totally shifted and become about the visibility and the status — more of the how to wear them."

Basically, sneakers’ rising status in the world of fashion has allowed big brands like Nike and Adidas to continue to offer elite shoes across a number of high price tiers. A luxury sneaker that might’ve sold for $70 a decade ago will now go for $100. And that upward trend is likely set to continue because of a simple truth: people are willing to drop a tidy sum on quality, fashionable sneakers.

But that’s not to say that sneaker prices are out of control, by any means. A proliferation of footwear companies and shoe options has cemented a wide range of price categories for shoppers. Jesse Einhorn, the data content director at e-commerce platform StockX, said that the vast majority of sneakers’ resale prices "have actually probably gone down" or held steady over the past decade.

"There’s a lot more supply these days," Einhorn told Business Insider. "There are more brands. Nike, Adidas, and other brands are putting out a lot more products. A limited Jordan release used to be a much more scarce product. Now there’s greater sneaker demand and sneaker culture has gone so mainstream."

The Kanye effect

But there are exceptions to that resale rule: the buzziest shoes with a scarce supply and a compelling, often celebrity-backed story.

Mike Lawrie/Getty Images

Celebrity collaborations are truly nothing new when it comes to sneakers. The shoe business has traditionally relied upon athletes — basketball players in particular — to sell sneakers. But DePaula said that a relatively new shift in this paradigm has allowed for sneaker culture to expand even further.

"Today, some of the biggest shoe releases are from entertainers," Peter Verry, the senior athletic and outdoor footwear editor at Footwear News, told Business Insider.

DePaula and Verry both cited Kanye West’s Yeezy line with Adidas as a seminal moment in sneaker culture.

"That’s just really made sneaker culture more mass-friendly," DePaula said. "You don’t have to be an athlete, you could just be a kid that’s curious about style."

Verry said that the continuing contributions of non-athlete influencers in the sneaker world have helped inject some life into the increasingly "stagnant storytelling" that athlete-focused shoes had begun to rely upon.

Entertainers can leverage a wider existing fanbase, and they have helped boost sneakers’ prestige by shifting the focus from performance to style. The fan of a star basketball player might be drawn to a shoe’s design or endurance on the court, but someone idolizing the stylings of artists like Kanye West or Travis Scott tends to be more concerned with what their sneakers convey to the world.

They also have the added bonus of not simply being visible during a single season out of the year.

"Look at Kanye West," Verry said. "He can tour 365 days a year. He can be relevant in the fall, he can be relevant in the summer, he can be relevant in the spring or the winter. There’s just much more opportunity for someone who’s always in the limelight to just come out and engage with his or her fan base."

Growing into a more casual America

That mass appeal, however, would come to nothing without a major shift in the world of fashion and dress norms over the past few decades. As the United States has trended more casual as a culture, sneakers have had the opportunity to rise up as a particularly hot commodity, as welcome in certain boardrooms as they’ve traditionally been on the basketball court or in the classroom.

Shoshy Ciment and Irene Jiang / Business Insider

According to Verry, sneakers are considered "prestigious" nowadays in part because "people today want to be more comfortable." Men and women alike are increasingly ditching their fancy loafers and heels for a more athleisure-inspired look.

"The functionality of a dress shoe is kind of outdated," Verry told Business Insider. "The fact that you can get class out of a sneaker and also not have your feet hurt at the end of the day — why would people ever abandon that?"

There’s no end in sight to the modern phenomenon of elite and expensive sneakers. According to early Nike employee Brent James, the founder of footwear consulting agency Concept 21, there’s even an argument for prices to spike across the board.

"Honestly, we’re still way underpriced," James told Business Insider. "Especially if we start factoring in the sustainability question and everything else. I think we’ve got to be doubling the price of shoes, so that then the maker of the brand becomes more responsible for the discarded shoes."

James spoke of how thousands of years in the future, the earth could be studded with white globs, the remnants of old sneakers that were unable to break down after they were discarded. He said that he envisions the rise of sneaker culture resulting in a return to the days of long-lasting, pricey shoes that could be repaired and resoled, back when shoes were treated as long-term investments, rather than passing fads.

At the very least, according to James, humanity must weigh the price of sneakers against the ecological cost of tossing out these non-biodegradable items.

"I’m hoping that we are going to start acclimating and consuming less," he said. "If that’s the case, then prices have to go up because we have to make better shoes. That would be my dream and hope. I really hope that this younger generation will really embrace this idea because otherwise, we’re just making a mass amount of garbage that really isn’t helping anything."

NOW WATCH: A pair of Air Jordans can resell for up to $2,000. Here’s why these iconic Nike sneakers are so expensive.

Source: Business Insider – feedback@businessinsider.com (Áine Cain)