The Growth of Streetwear Isn't Slowing Down
The subculture once reserved for streetwear enthusiasts is heading towards a mainstream zenith. An underground industry based on connections to “plugs” in order to obtain exclusive merchandise has transformed to a probability game of raffles, bots, and resale. Streetwear and sneaker culture may seem to be reaching a climax, but the falling action in this story doesn’t involve a dip in consumer interest.
The question still remains: When will the streetwear bubble burst? No time soon, thanks to its solid foundation as a pre-existing subculture.
AN EXCLUSIVE LIFESTYLE
While trends are mostly determined by a product, promotion, and price point, streetwear is driven by a timeless lifestyle.
Formerly, it was a rebellious niche influenced by the artistic grit of the streets. The birth of hip-hop and skater culture ushered in self-expressive brands including 10-Deep, Primitive, Stussy, Supreme, and Bape, all of which emphasized a counterculture romanticized by today’s top fashion houses. Luxury’s infatuation with an urban lifestyle is the latest attempt to resonate with Millennials and Gen Z, (take Dapper Dan’s collection with Gucci), and has led the fourth generation of streetwear to be dominated by elitism and exclusivity through limited edition “drops.”
After teaming up with Louis Vuitton to drop a signature collection of clothing and accessories, Supreme was reported to have earned a $1 billion company valuation. For retailers struggling to capture the younger digital customer, these drops have produced an ecosystem of exciting and exclusive collaborations, while placing street brands on fashion’s radar and elevating their company valuations.
Along the streetwear continuum, sneaker consignment holds a special place for retail investors: Goat, a resale app, received a $60 million last year (more on these guys later). StockX raised $44 million, and Stadium Goods was acquired by FarFetch for $250 million in December. Each consignment model is a staple in the streetwear realm, serving as “last chance” access for consumers to exclusive products they weren’t able to purchase. Where normal trends begin to mature and decline, the product life cycle for streetwear is extended through the secondary market, and at a hefty price tag.
Despite speculation of a soon-to-be oversaturated streetwear market from an overload of collaborations and investor funding, brands like Foot Locker recognize the long-term opportunity the secondary market can bring to its stores. The sneaker retailer is making a $100 million investment in Goat with the intent to bring customers back into stores. Whether Foot Locker’s 3,000 locations will double as a hub for Goat or pop-ups for limited releases, the mall-chain native plans to redefine the customer shopping experience and target streetwear’s core consumers: sneakerheads.
“At Foot Locker we are constantly looking at new ways to elevate our customer experience and bring sneaker and youth culture to people around the world,” Richard Johnson, Foot Locker’s chairman and CEO, said via a press release.
EVENTS, EVENTS, EVENTS
Event and pop-up shops are a driving factor in streetwear culture. From Sneakercon, the global event for vendors and attendees to buy, sell, and trade rare and sought after footwear, to ComplexCon, a curated convention attracting sneaker fanatics to embark on experiential shopping through exclusive brand activations.
Pushing the exclusive ideology further, consumers receive a chance to “cop” event-only products, and for those who don’t: the Instagramable moments plaster attendees’ feed as if to say “wish you were here!”
"It's a status symbol," says Michelle Grant, head of retail at Euromonitor International. "It reflects that you're in the know, that you're aligned with certain celebrities that reflect your lifestyle — and of course the price tags tend to be very high, which also indicates that you're affluent or aspire to be."
As of now, events will continue to grow and bring awareness to the streetwear industry, and more experiences like Hypefest will start to emerge.
STREETWEAR: HERE TO STAY
The hysteria streetwear garners with limited sneaker drops and merchandise designed by coveted industry mavens, such as Takashi Murakami and Pharrell Williams, is just too sweet to stay away from. While the potential of a bubble may be unsettling for analysts, the currently captivating revenue model isn’t far from how streetwear brands have operated for the last several decades. Art, design, music, and, ultimately, scarcity have fueled the growth of the sneaker market and streetwear industry and is poised to continue into the next decade.