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Hello Aluxers, and welcome back! I think it’s fair to say that many of us enjoy hitting the gym…
and we definitely like to look good while we do it.
And even if you’re not someone who works out regularly… you probably still love a good pair of athletic kicks.
Now, whenever we speak of high-performance shoes, brands like Nike and Adidas pop up instantly;
and in today's video, we’re going to explore how these sports brands are racing on up the high-end luxury market.
With an increasing mindfulness surrounding health and wellness in recent years,
performance sportswear products have become the latest entry in the luxury goods category.
A few years ago, there were only a select few luxury athletic brands like LuLuLemon - who pushed Yoga pants in the high-end fashion segment
but today, even top-notch sports brands like Nike and Adidas are focussing on - not just sportswear - but Athleisure.
If you’re thinking Alth-le-what? We gotcha covered.
Athleisure is a category of comfortable athletic clothing, ideal for both workout and everyday wear…
So don't be shocked if your friend walks in for a sunday brunch wearing a pair of compression pants and chunky sneakers,
because this new category has just swept the fashion world.
Instagram influencers all over the place are promoting high-end streetwear made by luxury brands like Gucci.
Even Vogue’s editor in chief Anna Wintour has confirmed the rising trend of fancy sneakers.
Currently the Athleisure market is worth $300 billion worldwide, and in 2020 it is expected to grow to $350 billion.
Fancy sneakers form a major part of this category, in 2018 the global sneaker market was valued at $58 billion and is expected to grow to $88 billion by 2024.
Athleisure styles have already hit the runway at the fashion shows in Paris and New York and with celebrities like Beyonce promoting it,
luxury athleisure has become the fastest growing fashion category.
Right now there are over 30 brands in the luxury Athleisure category,
so let's dive in to understand how favorite sportswear brands Nike and Adidas are giving us a run for our money.
Nike is known worldwide for its relatively inexpensive performance sneakers,
starting around $55 - but it's currently leading the charge when it comes to luxury athleisure products.
The brand has focussed on blending fashion with sports for both men and women,
and creating products that you would prefer to wear even in non-athletic settings.
Nike has collaborated with designer Matthew Williams and created a line of apparel using a data-driven computational design for a transitional lifestyle.
In June 2019, the first pair of sneakers, named MMw/Nike Free TR 3 fly knit were launched under this collection and priced way up to $325.
Nike has also shifted its focus on its female customer base and has moved beyond ‘shrink it and pink it’ strategy.
It plans to grow its women’s offering into an $11 billion business by 2020.
The brand is blending the classic materials like spandex and polyester in innovative ways to create attractive products fit for both form and function.
One such material is Aeroreact, which detects when the user is about to start sweating and adjusts itself to avoid discomfort.
Following Lululemon, Nike has launched its own Yoga line that is specifically tailored for studio practice,
and unlike its competitor, it’s also focussing on building a male customer base.
Nike is trying to promote Yoga as a complementary workout routine for sports enthusiasts to enhance their overall performance.
While to attract GenZ, Nike is blending technology with its iconic sneaker range and coming up with products like HyperAdapt self-lacing sneakers
that were priced as high as $720 in the launch phase.
Inspired by the movie “Back to the Future”, these pair of sneakers fall under Nike’s smart shoe line
and are equipped with sensors that tighten up the shoe around your feet as you step in.
When it comes to expanding in the luxury category, Nike has focussed on not just the products offered but also the service provided to its prime customers.
The brand has created new stores called Nike Live, exclusively for NikePlus members.
These stores combine digital features with unique physical environments
and will display products curated to meet the needs of the neighborhood they are located in.
The products available in the store will be filled on a bi-weekly basis and sometimes even exclusive, improving the entire purchase experience.
As the number one is expanding into luxury products, let’s see how the number two - Adidas catching up.
Adidas is known for its collaborations with various leading designers to create limited-edition sneakers.
Keeping up with the latest trend of luxury Athleisure, in November 2019, Adidas has announced its collaboration with Prada in order to blend sports with Luxury.
The first product of this collaboration is expected to be two limited edition styles launching this December, rumored to be sneakers.
In 2017, designer Raf Simons recreated the Adidas Ozweego range that featured bulky sneakers with exaggerated midsoles,
similar to the Balenciaga 2017 fall collection, these chunky sneakers became one of the trendsetters in the triple sole sneaker category.
Ever since, several iterations of Ozweegos have been launched - including the latest glammed up colorways, with metallic effect priced at $380.
Similar to Nike, Adidas is also focusing on its female customer base as it tries to expand in the luxury category.
The brand announced a new partnership in April 2019 with Beyonce under which the pop star relaunched her Ivy Park athleisure clothing line.
Adidas has also partnered with Kanye West to create the successful Yeezy range that blends brand’s boost technology with chunky bottoms.
In 2018, the Yeezy was ranked 9th hottest brand in the fashion world putting it at the forefront of the ugly sneakers fashion trend along with Louis Vuitton and Balenciaga.
Interestingly regardless of the high price point the Yeezy sneakers sold out in high volumes
and the Yeezy Boost 350 V2 became the second most Instagrammed sneakers ever.
The Yeezy is a perfect example of how Millenials all over the world are obsessed with fancy sneakers.
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The real challenge for brands like Nike and Adidas is to transform their manufacturing and supply chain technology,
to keep up with the latest trends in the luxury market.
In order to cope with the fast product life cycles in the luxury fashion world,
these sports brands will be forced to speed up their manufacturing, by investing in technologies like 3D printing - which comes at a very high cost.
However, compared to Balenciaga or Gucci, products offered by Nike or Adidas hit very high volumes worldwide,
and it will be challenging for these brands to manage their supply chain as they push products in the luxury segment.
Another dilemma for brands like Nike and Adidas is the sneaker-resale market, which is expected to become a $6 billion business worldwide by 2025.
The brands themselves benefit from the exclusivity of their ultra-rare limited edition sneakers,
but the major players in the secondary market are making bank, selling these unique products to collectors at prices as high as 5x the original cost.
In these cases though, it’s listing sites like stockX or Fight Club winning, as manufacturers see none of the secondary profits.
A few years ago, it would have seemed insane to buy a $200pair of leggings and overpriced designer sneakers,
but today - luxury athleisure has clearly become a trend, not just a fad.
It’s also worthwhile to note that studies have shown more people in the middle class are choosing to spend their money on luxury goods than ever before
which bodes well for brands like Nike and Adidas - who carry loyal middle-class followings - as they venture into the luxury space...
Now before we wrap this video up, Aluxers, we’re curious to know how much you enjoy luxury goods...
Let us know in the comments!
And, of course, for sticking with us until the end here's that bonus you're waiting for:
Have you ever dreamt of lacing up a gold sneaker?
Well, believe it or not, American artist Matthew Senna created a pair of sneakers coated in 24k gold for Canadian wrapper Blake,
branded as Air Jordan 11 OVO by Nike, these pair of sneakers are priced at $2 million.
Thank you for spending some time with us Aluxers.
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Thanks again and we can't wait to have you back tomorrow.