Friday, March 3, 2017

The Battle between Shoe Companies

The Battle Between Shoe Companies
Jack Wendelberger
Mr.Reuter
Economics B2
28 Feb 2017
The Battle Between Shoe Companies
In a generation of hipsters and sneaker heads the shoe brands are trying to get everyone on their side coming out with the “newest thing of this age” but it’s all just noise to break the bank and someone’s opportunity costs. Nike and Adidas have always been going head to head for the top name in the sneaker game but both have their own positive and negative externalities. When it comes to it there are the two things that split them apart, that is comfort vs. style.
Lately the shoe game has been on fire with Nike and Adidas taking the spotlight, in the past Adidas was really never big in the releasing in their shoes and was a traditional shoe company, making the their name for comfort and affordability. Lately they have started to go past that and start to make shoes that cost a pretty penny. In the past year Adidas has released the Yeezy’s, NMD’s (seen to the right), and ultra boosts. When it comes to these three shoes they have their positives more than negatives but it comes at a cost, these shoes are over $100, when it comes to the Yeezy’s they can reach a price of $400 and sometimes higher. When it comes to opportunity costs why would anyone want to buy a pair of shoes that are so expensive, well Adidas is well known for comfort, while Nike is known for their style, so your opportunity cost as a consumer comes to style vs comfort along with cost. According to Steve Joseph, “Adidas shoes are generally cheaper by 6 to 1” (Joseph). This comes with the less, older laid back styles of Adidas. Adidas is a old fashion but comfortable shoe line while Nike takes out the competition with their Jordan lineup (seen to the right) and with their high styles in Roshe and Janoski while Adidas is playing catch up with Nike.
Wrapping back to style vs comfort and away from price, Adidas has started to put in cloud foam insoles, an insole that features soft, lightweight cushioning while incorporating a sleek cut and a sturdy outsole (Simpson). Adidas has taken the upper edge when it comes to comfort and is now starting to move towards style with the shoes that are mentioned above. So Adidas’s positive and negative externalities is that they are comfortable to wear but they may not look as cool as the consumer would like. When it comes to Nike it’s the opposite. Theirs is that they have style down but when it comes to comfort they start to slack.

Simpson, Pierce. “adidas Introduces Innovative Cloudfoam Technology”, http:// www.nicekicks.com/adidas-introduces-innovative-cloudfoam- technology/. 24 March 2016.

Leach, Alec. “Nike vs. adidas: Who Owns the Market?”, http://wwwhighsnobiety.com/2015/ 11/09/nike-adidas-market-shares/. 9 Nov 2015.

Joseph, Steve. “What are the general differences between Nike and Adidas shoe products?” https://www.quora.com/What-are-the-general-differences-between-Nike-and-Adidas-shoe-products. 15 Sep.

22 comments:

  1. As somebody that has went through a full cycle of the sneaker game, I understand how the 'Hype' effects the market. With a shoe like the Yeezy, the market gets over hyped and prices sky rocket. The opportunity cost for these shoes getting very hyped up, is the fact that they can only release a limited amount of that shoe.

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  2. I think you will start to see these companies move away from the upper market with Nike's signature basketball shoes and free runners both not selling well compared to the much simpler and cheaper Roshe Run. People are realizing they don't need $200 shoes if they can ball on a budget in some Roshe's. Companies always have to cater to the consumer wants and needs and right now I think a lot of people want cheaper options because it's breaking everybody's bank to go out and get all the new releases if they're all $150 + so they'll stop unless they're deals. Nike and Adidas will most likely create simpler shoes, while I see Jordan sticking with their high end shoes because they like to pain the picture that they have the most quality shoes.

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  3. While you state that Adidas is slacking in terms of style or aesthetic appeal, that is purely subjective. For example, in my opinion, and in many other's opinions, ultraboosts, both uncaged caged, NMD's, and others, are some of the nicest looking shoes. It is all purely subjective. Likewise with comfort. I have plenty of nike shoes that are comfortable. My Kobe 9's have the most comfortable insole out of any shoe I own.

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  4. They say that you can judge someone by their shoes. People are always trying to make their shoe game stronger to up their image. It is also interesting how the demand for certain shoes can go way up if someone famous is endorsing them. Imagine if Michael Jordan never came out with a shoe line... Would there be the "hype" around shoes that exists today?

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  5. It's true that Nike and Adidas have been going head to head for a while, but lately Adidas has been killing the game compared to Nike. Since Adidas has been all the hype, they're able to jack up their prices and still have sales because they're so prestige. With the limited releases it also gives a narrow market causing resale prices to skyrocket, giving others the opportunity to make money off the shoes.

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  6. Now a days teens camp out for days just for a pair of limited Yeezy's or any other limited pair of Adidas. What really controls the hype are the celebrities and twitter, every time a new shoe drops Twitter goes crazy with "HypeBeast". Every limited sneaker that Jordan and Adidas drop the more hype surrounds them. Which means the price goes even further up

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  7. This comment has been removed by the author.

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  8. It's crazy how much "Hype" influences the consumer. Air Jordan's used to have televised advertisement to hype up their product, Now with the internet around, Jordan's get free publicity, on a major level. Websites like Craigslist, eBay, and other stores have created a new level in "Shoe game". Sellers list their exclusive shoes online for hundreds of dollars more than the shoes original price, because they know a hype beast consumer will pay the price. Sadly most Jordan's are made in China for a little over $16. So technically everyone is getting played by the Nike Corporation.

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  9. This is a very relevant topic that we can all relate to and I must say I never really looked at my shoes in such an analytical way. I had no idea how much can actually go into my choice of shoe to wear. I thought it was good how you used the terms "shoe game" and "hype" to relate to the reader. I will think further about my opportunity cost when buying my shoes next time.

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  10. I have both NMDs and Roshes from Adidas and Nike. I disagree about one being more comfortable or stylish than the other. Personally, my NMDs and Roshes are both comfortable and look good. I think it's just what the consumer prefers style wise since each brand has their own aesthetic. I understand the "hype" of sneakers because there are sneakers that I have wanted, but are so overly priced and hyped that it's hard for the consumer to get their hands on. For an example, yeezys are sold for around $250-$400, but since the demand for them is so high, but there is only a limited amount of them, consumers buy them at retail, but sell them for a much higher price. It is a little ridiculous that people would spend so much money on just a pair of shoes.

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  11. With the current state of the shoe industry, more often than not consumers are heavily influenced by the "Hype" around certain big name celebrities. For example Kanye West has a line shoes produced by Adidas where a Yeezy 350 Boost retails for around 200 dollars but with the "Hype" that inevitably circulates around this shoes you can find it being resold at over $2000. That means that Kanye's line of shoes can be resold at 10 times their original price. This shows how big celebrities have a huge impact on the consumer market in the shoe industry.

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  12. These two shoe brands are both successful, but I think Nike has the upper hand. Nike is much better at advertising their brand in a way that appeals to everyone, especially younger consumers and integrating the Nike brand into fashion. Nike's brand presents a super cool life style. There's also more people in the media who wear Nike, which says something about Nike's shoe quality. I have Nike shoes myself and I have never thought they uncomfortable. Besides those super expensive shoes, Nike and Adidas do have other shoes at reasonable prices like $50. Personally, I would choose a Nike pair of shoes between the two because they're comfortable and more aesthetically pleasing to me.

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  13. Whenever I go to buy any clothing -- whether it be shoes, shirts, pants or anything in-between-- the debate has always been between buying Nike and buying Adidas. These brands have competed for years, and when it comes to shoes -- as you stated -- these two make their name through either style -- for Nike -- or comfort -- for Adidas. Personally, I have bought both brands in the past, and enjoy each for their own unique qualities. However, I generally find myself leaning towards Adidas when purchasing shoes, as they normally are cheaper, more affordable and just have a look that I generally like better than Nike. Furthermore, the shoe arc in Adidas shes never protruded as prominently as it did in Nike shoes-- which goes back to the idea of Adidas shoes being more comfortable -- making me prefer Adidas even more. In spite of this, both brands are excellent, and I can't condone anyone for picking either option.

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  14. I find it interesting how people will just see a commercial about these shoes and instantly want to buy them. I don't think people care about what they say about the shoe, it just matters on how they look. As in other comments people had stated that people are always looking for way to improve their shoe game. Nike and Adidas have always been in competition with one another. There are some people who sell shoes on other websites such as: Craigslist, eBay, and sometimes people sell shoes around their community for a cheaper price. Which this impacts the economy by these two companies battling back and forth for customers by producing new shoes. The businesses economy probably shoots down and back up because of the new shoes that are being produced, get interest in customers and the battle keeps going back and fourth.

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  15. Lately Adidas has been changing their branding so the consumers see both comfort and style. Their recently introduced styles can compete with Nike, creating consumer interest. Why would a consumer by one pair of $100 shoes that are comfortable and one pair of $100 shoes that are stylish when Adidas is now providing both for $100. This is a win, win situation for the consumer. However, Nike will have to meet the current market demands for reasonably priced shoes that have quality benefits. Soon this competition might cause Nike to come up with more innovative and affordable shoe options that change the shoe market.

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  16. Shoes are a big part of our everyday life. We all have our own pair of shoes that we wear daily most of the time more than one pair we own. When it comes to companies making shoes we usually like one company of the other so we follow what that company is doing. It is all choice of preference if we like style or comfort better. I personally have both Nike and Adidas shoes. I don't really go for the comfort I usually go for the style and look of the shoe. They are both comfortable to me> I don't think that Nike only has shoes for style they also have some comfortable ones also because my basketball shoes are made by Nike and they are very comfortable and are able to last a long time since I play basketball in them almost everyday. But I agree with you saying that Nike goes more toward style while Adidas goes for the more comfort side of things.

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  17. With the news and "coolest" shoes seeming to be released every month, Adidas and Nike are constantly on top. With this shoe battle, it mostly comes down to preference. Shoe are getting more and more expensive and more people will not want to purchase these shoes unless they are their preferred brand. As both the Yeezy's and Jordan's shoes cost upward to $400, a fan of Nike might not want to spent all of that money of a pair of Yeezy's and vice versa. Taking this into consideration, I think this battle is more of the company that has better advertising of their shoe rather than the actual shoe itself.

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  18. This is a very relevant topic that we can all relate to and I must say I never really looked at my shoes in such an analytical way. I had no idea how much can actually go into my choice of shoe to wear. I thought it was good how you used the terms "shoe game" and "hype" to relate to the reader. I will think further about my opportunity cost when buying my shoes next time.

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  19. The shoe market is always changing. At any given time shoes from one company can become much more popular than their competitors and vice versa. In general the public wants a good product to buy no matter which company. Although looking for a good product, price is also a big thing when it comes to shoes. Many signature shoes from both Nike and Adidas are quite expensive but provide both the style and comfort customers look for. The high price is a cost that I am willing to pay in order to get a top quality product that fits all my wants. The style of shoe also is a big factor when it comes to buying. Sometimes I am looking for a cheap shoe that I can run around in without any care and sometimes I look for a more quality shoe that I would care much more about. It is all based on what I want at the moment and whatever shoe fits all of my wants and brings the maximum amount of positive externalities, I will most likely buy.

    Jaeger H

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  20. I think you brought up a lot of interesting points. Besides Nike and Adidas there are also other shoe companies that are competing for style, comfort and price. For example, Under Armour has Stephen Curry's shoes under their brand which steals potential buyers. Besides that, the shoes people wear is all about preference and their needs/wants. Some people might be willing to pay more money for the comfort whereas others might not want the comfort they would rather have the style. Personally, I buy shoes that I like and will enjoy wearing. Going forward, I will start to weigh in the opportunity costs of buying shoes so I get the best buy possible.

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  21. While I believe that these are probably the two leaders in shoes at this point and time, many other companies are also making a push to offer style, comfort, price, and luxury. For many up-and-coming companies, they have been able to secure some popular athletes such as Under Armour with Steph Curry and Jordan Spieth. Luxury shoes are becoming more and more popular as the number of 'sneaker heads' and shoe enthusiasts increase. People want that new and hot product and sometimes offering a overpriced and flashy shoe is beneficial for these companies.

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  22. It seems to be that newer and cooler shoes are being released each month with two brands consistently dominating the industry, Nike and Adidas. With limited differences to the shoes it ultimately comes down to consumer preference. For a few years Adidas fell under the radar but lately have been changing their branding and style to fit the consumer needs, where they get comfort and style. This push has been driving down the interest of Nike since their prices are increasing. Consumers are looking for the shoe that have the "it factor;" they have a low cost but still a popular and comfortable shoe. Instead of having multiple types of shoes for different purposes, brands like Adidas are starting to offer all characteristics in one which really attracts the customers eye since there is no longer a large opportunity cost. The tight competition will force brands to come up with new and unique styles that are more affordable.

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