rainking
Supporter
- Aug 12, 2016
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It’s gotta be a cost cutting measure. 97s adjusted for inflation would be $350 today and 2010s adjusted for inflation would be $290 today. Obviously, inflation doesn’t hit every material or product at the same rate, but it’s clear Nike wouldn’t have the same profitability selling OG mold and materials for $230 today. I would personally be willing to pay $300-350 once every few years if they nailed it, but that’s just not Nike’s business model now. And every release would turn into the 17 lows if that happened. Unfortunately, we’re either going to get bad takedowns of classics or not get them at all.
For the inflation cost convo does it apply when Nike’s initial cost included all the R&D and manufacturing to get the shoes produced? The retros shouldn’t be close to the inflated anyway because so much of the work to create the shoes have already been built and designed. If anything wouldn’t things be cheaper? Even if Nike made them like the OGs part of the cost would likely be how much hype/demand would justify the price. It’s why other Nike retros don’t get near the JB retros despite there being overlap between tech and materials used
I’m no economist or product planner so I have no idea.
This. I have no doubt it's a cost-cutting, margin-improving decision, but I also think the inflation formula doesn't work 1:1 on these for various reasons. One of those reasons is indeed that the OG price of Foams was due to the original R&D and then the expensive molds required to make them. But that was also at a time when Nike's business model didn't account for the idea that shoes would live forever and be able to be rereleased and sold over and over again, because the retro thing wasn't a thing yet. So I presume the high OG price was arrived at to cover the R&D and manufacturing costs that needed to be covered by sales of the shoe for only a year or so, because that's what the typical shelf life of sneakers was at the time. Nike wasn't thinking it would be selling runs of this same shoe repeatedly over the next nearly 30 years, which would obviously massively scale the cost per unit a lot lower than it appeared originally.
Point is, I don't believe for one second that Nike can't make a good margin on Foam sales today at the price it charges even if it kept the proportions/specs of the shoe the exact same as they had been. This new downsized version likely just makes those margins even better, and companies and shareholders are greedy. If they can get away with it and still sell through entire runs of shoes, they'll do it.
What I do find confounding--and admittedly it's probably because I don't know anything about how these things are actually made anymore--is that it seems to me it would be more expensive to go to the trouble of making new molds or whatever Nike calls them to produce these Foams in this altered form. The existing molds that had been in use ... why not just keep using them? But it's probably a simple formula: Is the cost of new versions of the mold less than the increased profit margin from shrinking the shoe? If so, that explains it. And who knows, maybe the Foam molds were in need of replacement after years of use, so at that point Nike sees it as a good opportunity to downsize them when it needs to order new ones.