How Air Jordan Built A $3.6 Billion Sneaker Empire

this is the jordan one high in the chicago colorway from 2013. the shoe was listed for about a thousand dollars on the resale market the lowest ask for a pair of these shoes from 1985 and the same size is 30 000 in may of 2020 a pair of original jordan ones that mj wore on the court sold for five hundred and sixty thousand dollars at auction that's because in sneaker culture there are the air jordan models mj worn the court during his days as a chicago bull and then there's everything else some about his swag man like it's almost unexplainable he just had that it factor air jordan is still riding high from espn's the last dance which aired in april 2020 but the hype around jordan isn't some short-term fad built on exotic collaborations and influencer campaigns there is no bigger influence on sneaker culture than michael jordan because there is no bigger name in american pop culture and it's not just men women are a fast growing segment of its consumer base it's a rush when you can get your hands on the newest pair of jordans today retro jordans of all types and colorways from the jordan 1 retro high og university blue to the georgetown 3s sell out almost instantly on the sneakers app and then select stores across the country and every saturday morning twitter is full of sneaker heads complaining about their latest ls punctuated with screen grabs of gotham from those lucky few here's how jordan built a die-hard following of enthusiasts on its way to becoming a 3.6 billion dollar sneaker empire this is suddenly obsessed the story between michael jordan and nike is a part of american folklore a young mj wanted to sign with adidas but his mom made him visit the execs at nike in 1984 he inked a 250 000 contract to develop his own line of air sneakers nike has paid jordan an estimated 1.3 billion since he signed that first deal jordan debuted his first pair of nikes in 1984 the white and red airships during his rookie season and put out a new sneaker every year he played in 1985 he sported the famous red and black jordans known as the band 1. in 1988 he wore the white cement jordan 3 when he left from the free-throw line to win the dunk contest the five is the one with the teeth that look like a world war ii fighter jet he won his first championship in the six he was wearing the 11 when he won his first championship out of retirement in 1996 and he made the famous last shot in the 14. every year it gave you something to look forward to the athlete was actually wearing them and then those are the shoes that you could buy if you saw him dunk from the free-throw line and this shoe and it's immortalizing a poster you can actually buy this shoe and wear it everyone likes to be a winner and you know in a lot of ways that carries over into the style of it of the actual shoot people want a part of that which is why they gravitate towards jordan brand because lord knows if if jordan didn't win who knows if we'd be having this this conversation jordan brand is still releasing new sneakers every year but the original models in the og colorways the warrants mj wore on the court those are the ones sneakerheads covet the most to the trained eye each model represents a different era of michael jordan's enduring legacy on the court every material and colorway has its own backstory telling a different part of that narrative take the pair that started the craze known as the band ones jordan was said to have been fined five thousand dollars per game for wearing the black and red highs because they didn't meet the league rule that a player's shoes had to match the colors in the uniform the band one didn't have enough white jordan wore them anyway rob strasser who was running nike's marketing at the time said we'll pay the fines and keep wearing the shoe and so they ran ads saying banned by the nba and i think that got a lot of attention but in terms of real numbers it was not a it was not a huge shoe but certainly a lot of interest around that and i think kids coming up over the next 10 years of his career really wanted to dress like him and wanted to wear his shoes the lowest ask for a pair of original banned ones from 1985 on stockx is 26 550 the band 1 has been released in different variations over the years and each time it sells out almost immediately but supposedly jordan was never actually banned from wearing the black and red air jordan 1. that's because the shoe he was banned from wearing was really the black and red airship that came out a year earlier in 1984 nike released a retro pair of airships in the band colorway in 2020 and those black and red airships are the most expensive pair of retro og jordans at new york city's flight club mainly because you know it was a very very rare release that came out last year 2020 around the all-star break the mythology of you know jordan brand is going to be one of those things that will help himself forever the band saga is just one small anecdote in the rich history of jordan that lore creates an authentic connection between jordan the player his shoes and his fans a lot of shoes today don't have that they're trying to recapture that but it's very hard because it's not organic it's very forced all of this stuff just happened to have happened and we let it happen and then people like me bought it and we have never let it go jordan the brand is as good at marketing as it is making striking shoes and the company knows exactly how to use that to its advantage with die hards take the back plate on the jordan 3. when jordan wore them on the court in the 88th season it had the nike air insignia on the heel not the jumpman logo that detail makes all the difference the jordan ones worn by the man himself had the nike air tag on the tongue that tag means everything to sneakerheads but the jordan 1 high 85s take it the furthest the white and neutral gray jordans dropped in february of 2021 and is a true throwback and heavy on the details the shoes came with the original tags and the sticker with all of the product details just like they did when they were released in november of 1984 the production code is even printed on the inside of the shoe the shape of the shoe is done to the 1985 specifications which is a little boxier than the new versions but perhaps no marketing campaign could have been as effective as espn's the last dance in 2020 sales in almost every major category at nike from soccer to running were down revenue for the jordan brand grew 15 to 3.6 billion according to forbes it may surprise you we've authenticated 3.5 million pairs of air jordans since inception and a million of those have been authenticated in the last six months but the jordan brand has always been about what's next the company has mastered the art of weaving nostalgia into current trends through collaborations with up-and-coming artists like ali may the 29 year old designer from south central l.a i never imagined that i would have you know my own jordan let alone four even right now it's still hard to be like yo you're really doing this um just because again like that's your dream laylee designed her first pair of air jordans the retro one high shadow in october 2017 which is currently reselling for about a thousand dollars this year she's releasing the jordan one high zoom comfort her fourth jordan and the story behind that one is extremely personal the blue is a representation of my elementary school and then we have the green which is a representation of englewood high school so i had a drill team teacher she was amazing her name was shanora and she would let me and another girl in elementary school practice with high school girls that was really dope for me and also i was very scared and nervous because you know you're here with the big dogs now you gotta be sharp today women make up about 24 of all jordan buyers you can dress them up and you know just redefining femininity like you can wear sneakers and still look just as feminine or girly or you know still give that look it doesn't have to be masculine it doesn't have to be street wear you can do a dress and still give sneakers as well but bigger names draw even more attention like the jordan 1 retro high travis scott which retailed for 175 but will set you back about 1800 on the resale market you know if you listen to the music you want the shoe or designer virgo abloz deconstructed take with his jordan one retro high off-white university blue virgil was able to dial into the dna that was already there and deconstruct it which is something that's a more recent trend in terms of like this deconstructed feel the hyper on collabs is divisive in the sneaker community the competition to secure a pair of jordan collaborations is bleeding into the og lines they meet the nostalgia requirements for most of people like me but then they're also here for newer people that might not know the history and maybe they don't care if you're not inside the world of sneaker culture you probably don't understand just how hard it is to cop a pair of jordan's sneakers for retail tales of winning on the sneakers app tend to sound like heroic feats of strength this is actually the only shoe i've won on the sneakers app in the last three years man i remember like it was yesterday i was sitting next to a co-worker he taps me and he's like hey i heard that these are going to drop a day early open up your sneakers app and i had access to them and it was the easiest time i had checking out with the shoe in modern sneaker days hyped up collaborations might get all the attention but the aj11 jubilee was one of the company's largest footwear launches ever generating more than 175 million dollars in revenue nike seems to be making sure supply doesn't quite keep up with demand i think that really uh what's what's driven the longevity of nike is is scarcity and making sure that they don't make too much of a product i think that keeps the interest very high even though jordan is well over a three billion dollar brand today it's still being driven by unrequited demand and most most jordan releases sell out on release day the gulf between supply and demand is one reason all retro jordans not just the collaborations or original colorways is so intense it's also what makes the resale market so lucrative which can frustrate sneaker enthusiasts who just want a chance to own a piece of mj's story there's always going to be these other people in the way trying to take advantage of our passion our nostalgia and that's fine but they also need to never forget like what brought them to where they are right now like this is a 35 year old brand that was built off of one man and a lot of customers jordan brand is by no means perfect material quality can vary greatly from shoe to shoe nike was accused of using forced labor in the making of its shoes prompting the company to issue a statement we will continue to expand and evolve our work with other peers in the countries where we and our suppliers operate nike has done a remarkable job of building a lasting brand in jordan but most of the credit has to go to the man himself and his incredible run of excellence with the bulls that's why almost all sneaker enthusiasts have a special memory tied to their favorite pair of jordans this is actually the first shoe i saved up my money for and was able to buy myself so like this is like one of my favorites of all time what i remember was the carmine sixes that was my like first pair that i remember i grew up in south central los angeles and you know every kid around was waiting for the newest jordans to drop even my grandmother talks about her by my uncle and waiting in line for a pair of jordans so this is definitely something has been happening generations before me but my uncle used to buy me jordans and i think even with that sentiment you know this was one of my coolest family members around the black cement 3. that pair meant a lot to me because i had the countdown pack version i have this vivid picture in my mind of of kanye west walking down the street with amber rose and they have these matching pair of black cements and denim jackets and the scarf that image is burnt in my head and that was the picture that was like okay if he's doing it i need to i need to have these in an era of fleeting trends and social influencers few things have true staying power but the connection between jordan the brand and the player is inseparable and so is the community that celebrates it everything about his brand and his products are definitely tied directly to him and it just makes you feel a certain way it just hits you right in the feels that special feeling of wearing a pair of retro jordans is just as strong today as it was in 1985

Channel: CNBC Make It

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Keywords: CNBC Make It, How To Make It, Entrepreneurs, Starting A Small Business, Business Success, Small Businesses, Finance Tips, Career Tips, Work Hacks, Lifehacks, Money Management, Career Management, Managing Business, air Jordan business, air Jordan sneakers, Weartesters, weartesters cnbc, weartesters jordans

Id: ZhzQ3HxvIBQ

Length: 12min 35sec (755 seconds)

Published: Tue Apr 27 2021