By The Biz Team (Siam)
Kanye West, by all accounts, is an eccentric character and sometimes (okay...often) a braggart. But there is no question that he's talented. Known for most of his life as a rapper, songwriter, and producer; it is his success in the world of business that has proved surprising. Despite being outspoken and controversial on many issues, he clearly knows how to make a sale. As a fashion designer, he has collaborated with the likes of Louis Vuitton, Nike, and APC on both garments and footwear. However, it is his Yeezy collaboration with Adidas that has garnered him enormous wealth.
After a failed relationship with Nike (they wouldn't pay him royalties for his designs, but instead wanted to give some of the proceeds of sales to a charity of his choice), Kanye released the Yeezy Boost with Adidas in 2015. Reviews were mostly positive, and the shoes were deemed to be classy, elegant, tough, and could be worn for everyday, casual events. The same year, he carried over that success to unveil his Yeezy clothing line. That’s when things started changing even more, as he started becoming more famous for his design, instead of his musical talents.
Hoping to compete with the Nike Jordan, Kanye and Yeezy did a brilliant job of playing to their market by limiting the number of shoes, and setting the price high. Because of Kanye’s involvement with the Yeezy brand, as well as there being a limited amount of items put out, they became a hot commodity. Basic limited item shoes would cost $250, sell out in minutes, and then be relisted for thousands of dollars. Even at such a high price tag, people were still snatching them up.
Because of the lucrative success of the Yeezy brand, Adidas offered Kanye a deal that would shock the whole world: 15% of royalties on wholesale, and a marketing fee (Michael Jordan's royalty deal is estimated at 5%). Given that Yeezy made $1.3 billion in 2019 alone, it causes one to wonder why it received over $2 million in PPP loans so it could keep its 106 employees? But that's for another post.
Although the hype isn’t what it once was, Yeezy shoes are still a fierce competitor in the open market. How long this trend will continue remains to be seen. Considering Kanye's recent threats, er...claims, of running for president, and frequent Twitter rants that raise questions about his mental health, his image and brand may suffer. Additionally, he may have broken the cardinal rule among limited sneaker lovers: releasing new models too often. But for better or worse, it looks like Kanye won't need to write or sing songs for quite a while. He recently signed a ten year partnership deal with clothing retail company Gap, which might help the retail company, as well as Kanye, to rebrand themselves.
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Are people still buying Yeezy shoes? By Siam B