It’s no longer a novelty to find casual, playful sneakers in the collections of the world’s most sophisticated luxury brands. Where labels such as Louis Vuitton, Prada and Gucci once only had minimalist, sleek casual footwear that tried to keep their sneakerness a secret, now consumers can find chunky options that beg onlookers to notice their brightly-coloured uppers and non-stilettoed soles. 

Luxury trainers have also become the products of brands not typically considered part of this exclusive market. Last year’s collaborations between sports brands and luxury labels included sneakers from Prada for adidas and the Jordan Brand x Dior collections.

New 2020 collections from luxury and sports brands alike are dotted with $300 to $3,000 options, as online marketplaces auction off previous years’ sneakers for even more. There is a thriving market of luxury sneakers that serve as fashion pieces, financial and cultural statements, because consumers clearly are willing to spend real money on the coolest category of shoes.

The rise of the “dad” shoe

A drift toward luxury-brand sneakers has been underway for years, but a rather universally recognised turning point in the luxury sector’s unabashed-sneaker movement was January 2017.

That is when Balenciaga debuted its Triple S sneaker, so named because it stacked three soles — soles made for running, basketball and track — together. Combining primary colours and yellowing-whites to make the shoe look worn in, the Triple S was building on the “ugly shoe” or “dad shoe” trend that had been simmering.

The debut of the Triple S came just months after Hillary Clinton beat Bernie Sanders in the US Democratic presidential primary, and Balenciaga creative director Demna Gvasalia brought that vibe to the 2017 autumn/winter runway. Models wore the unisex sneakers with loose-fitting khakis and blue and red tops on which the Balenciaga label was printed in the style of Bernie Sanders’ campaign logo.

Mr Gvasalia knew what he was doing. Millennials overwhelmingly supported Mr Sanders over Mrs Clinton, and millennials were beginning to overwhelmingly support Balenciaga. A year after the Triple S debut, Balenciaga CEO Cedric Charbit told a Financial Times luxury goods conference in Venice that millennials represented 60% of the company’s sales. (He also joked that he was being stopped by fathers everywhere imploring him to stop releasing those shoes because their children were spending too much money on them.)

Other luxury brands continued to expand their ideas of what luxury sneakers could be. For example, Louis Vuitton’s summer/spring 2018 included the first Archlight trainer — a futuristic sneaker with a wavy, hyperbolic arch and outsole and an exaggerated tongue — for around $1,000. For autumn/winter 2018, Gucci released the Flashtrek, a sneaker that seemed self-consciously ironic, with its logo presented in video-game font and a gaudy band of crystals draped over what looked like a hiking shoe for around $1,400.

Newer versions of both shoes feature in the two luxury labels’ respective 2020 collections.

Why Millennials matter

Millennials have been emerging as an extremely valuable cohort in luxury spending. Last year, when NPD group reported that sales of luxury fashion items had increased by nearly 50%, chief industry advisor Marshal Cohen credited a new demographic of shoppers.

“The luxury market is evolving, new brands are getting attention and online retailer platforms are elevating the competitive landscape,” he said at the time. “The younger, multi-ethnic demographic that is more attracted to purchasing designer products online — even more than the average online accessories, footwear, or apparel buyer — is a major contributor to this evolution.” 

So much so, the group reported, that footwear was responsible for nearly half of all online luxury fashion sales, and the average per-buyer spending on shoes had increased by 4% to $794.

This younger, increasingly powerful spending group is also recognised in the 2019 True-Luxury Global Consumer Insight from Boston Consulting Group (BCG) and Altagamma. According to the report, millennials (those born between 1978 to 1992) currently represent about 32% of luxury spending. For the next seven years, the report predicts, millennials will be responsible for around 130% of market growth, and in just five years they will comprise half of the total luxury market.

Close on millennials’ heels are Generation Z consumers, who are predicted to soon be driving 8% of luxury spending. The BCG and Altagamma report says that the younger half of this cohort (those born between 1993 to 2001) will strongly influence the speed and breadth of how the luxury market evolves.

Couple that prediction with findings from StockX, an online marketplace that specialises in sneakers, and it is safe to assume sneakers will remain a big part of the luxury market’s evolution. According to the company’s StockX Snapshot: The State of Resale report, the primary sneaker market is currently worth $100 billion.

Lyst, the fashion-focused global search engine, recently published its Year in Fashion 2019 which summarised data collected from the platform’s 104 million shoppers. Customers were found to have spent on average $192 on a new pair of sneakers, which is a 39% increase from the previous year. The most popular shoe — the Alexander McQueen oversized sneaker — was searched for every two minutes on Lyst; they cost around $550.

“As dress codes continue to relax and the definitions of luxury, streetwear and sportswear evolve,” the Lyst report says, “the phenomenon previously known as ‘streetwear’ powered the year’s biggest trends.”

NPD’s recent Future of Footwear report echoes this observation, forecasting that sport leisure footwear sales will pass fashion to become the largest footwear category in 2020.

“Fashion footwear has been heavily driven by comfort, as casual styles continue to gain share at the expense of dress, and this shows no signs of slowing down,” says Beth Goldstein, NPD executive director and industry analyst for accessories and footwear. She says this accompanies a trend for less dressy styles becoming more acceptable in both formal and professional settings.

While these numbers and predictions capture aspects of markets typically measured independently of one other — luxury goods and sneakers — they highlight the place in which the two intersect. Millennials are buying shoes that blur the line between sports brands and luxury labels, but largely paying the price tag of the latter.

The sneaker marketplace

As luxury brands keep their collections fresh with limited edition collaborations and new releases every season, new niches are being carved within this growing secondary market.

This includes burgeoning entrepreneurial businesses such as Anthony’s Shoe Concierge, which collects, cleans and repairs shoes — some to be returned to the owners and some to then be sold online. Of the sneakers who come through his business, owner Anthony Barrera tells World Footwear, most are “collectable, limited, rare or simply a favorite sneaker that’s no longer being made”.

While Mr Barrera started his business three years ago, it has been in the last year and a half that he has tapped into the market for reselling sneakers. He currently sells around 25 new and used pairs of shoes a month on eBay and expects to increase his inventory and sales.

At the other end, StockX authenticated more than 750,000 Yeezys (the collaboration between adidas and Kanye West, which has gone through several incarnations) in 2019, and the site reports a 2019 gross merchandise value of over $1 billion.

StockX launched in 2016 and, while it sells apparel and accessories, it specialises in sneakers. This is how it works: a person lists an item, which can be sold immediately or to the highest bid. When the item is sold, the buyer pays but StockX holds the money. The seller ships the sneakers to one of the company’s authentication centres, where the shoe’s brand is validated. StockX then ships it off to the buyer and releases the funds to the seller.

Speaking to Lisa Abramowicz on “Bloomberg Money Undercover”, Mr Cutler, StockX’s CEO, said that the authentication process was key to the site’s success because it creates a high level of trust in the marketplace experience.

He acknowledged that in many cases, shoes have been bought as investment pieces and are sold on the site for many times their original price. Such shoes have not been worn and are in perfect condition, he said, but they might date back ten years and have therefore appreciated because supply is so scarce.

There is, for example, currently a pair of Nike MAG Back to the Future (2016) shoes listed for $70,000. (The highest current bid is $30,000, so the seller might not be so lucky.)

Under his leadership Mr Cutler credits its younger customers. “With nearly one in three Gen Z consumers identifying as ‘sneakerheads’, this younger generation is driving rapid growth in the secondary market,” the company said in its report. “[Generation Z] will continue to propel our business growth in 2020.”

This year’s luxury shoes

The dad thing might be passing. Balenciaga just launched the Zen sneaker — dramatically different from the Triple S in its lack of drama, with a sleek, minimalist design.

But the playfulness is alive and well. Right now, Gucci offers a Disney collaboration featuring Mickey Mouse on the ivory leather of a $750 sneaker. (Gucci still makes the Flashtrek, but this year’s is a gentle, cream and white version.) Prada’s simple white leather and nylon shoes offer an oversized rubber sole and transparent tread for $920. Louis Vuitton’s latest Archlight maintains its funky wavy sole for $1,060. One of Burberry’s latest, the Arthur, has gold and silver metallic leather, bringing a rain boot aesthetic to a sneaker.

Balenciaga has not abandoned its landmark shoe, though its latest version is a more feminine white and pink version launched as part of the label’s Spring 2020 line. It seems the ugly dad shoe of that Bernie Sanders-themed 2017 show might be giving way to a more elegant “daughter” version.

Maybe that is because Mr Gvasalia was watching Mr Sanders interviewed last autumn on US late-night talk show Desus and Mero. When learning some marketplace selling prices of Travis Scott Nike Air Jordan 1 Retro High ($1,500), the Off-White x Nike Air Jordan 1 Retro High "Chicago" ($4,500) and the Air Yeezy 2 Red Octobers ($11,000), Mr Sanders acknowledged he preferred something around $45 — as long as it has rubber soles and shoe laces.

Prada for adidas collection credit: adidas

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