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Stephanie Kang of the Wall Street Journal reports “Some of the fiercest competition in the National Basketball Association this season is happening off the court. A crowd of expensive signature shoes linked to pro players is challenging the market for high-performance, high-profile sneakers.
The shootout features some of the biggest names in basketball. Nike Inc. has new shoes from the Cleveland Cavaliers’ LeBron James, the Denver Nuggets’ Carmelo Anthony, the Los Angeles Lakers’ Kobe Bryant and (from its Converse unit) the Miami Heat’s Dwyane Wade. That’s in addition to a new model from the all-time champion of basketball shoes, Michael Jordan. Germany’s Adidas-Salomon AG is countering with shoes from Houston Rockets star Tracy McGrady and the Minnesota Timberwolves’ Kevin Garnett. Reebok International Ltd. is in the game with star guard Allen Iverson of the Philadelphia 76ers.
That’s an All-Star Game’s worth of talent angling for the title of sneaker king that has long belonged to Jordan. With high prices — Jordan’s new Air Jordan, to be launched in February, XXI, will retail for $175, and many others sell for $125 — most of the shoes come with a style or technology gimmick and are often backed by big ad campaigns.
McGrady’s $125 shoe, for example, comes with small pieces of wood from an actual basketball court embedded in the heel and outsole (to symbolize McGrady’s desire to “put a piece of the court” into his shoes, according to the company). Reebok’s $125 Allen Iverson shoe, the Answer IX, uses a revamped version of the company’s Pump technology to fill up chambers throughout the shoe with air as the player moves. Nike’s Zoom LeBron III, which sells for about $125, boasts twice as much cushioning as most Nike shoes.
But while sales of so-called marquee footwear have been strong, there are indications the public’s interest may be waning, especially at the highest prices. For the 12 months ending Nov. 30, sales of basketball sneakers for men were down 4 percent from the year-earlier period, according to NPD Group, a market-research firm based in Port Washington, New York.
Customer satisfaction with athletic shoes is at a four-year low, according to the American Customer Satisfaction Index. The culprit is price, says Claes G. Fornell, a business professor at the University of Michigan, which compiled the data. He noted men’s athletic shoes are priced about 5 percent higher, and women’s almost 10 percent higher, than a year ago. Customers are “as pleased with the product as before, but they’re not pleased with what they’re getting for their money,” Fornell says.
One of the strongest sellers of the new sneaker entries has been the least expensive: Converse’s “Wade” shoe, which has a comparatively low price of $90. It is benefiting from interest in Wade, currently among the top 10 scorers in the NBA.
There’s also evidence that the teen consumers who drive athletic-footwear sales may be turning to cheaper and more fashion-forward styles from European companies like Puma AG.
While most sneaker shoppers are more likely to run up and down the supermarket aisle than the basketball court in their high-performance shoes, many buyers of high-end sneakers want the latest technology. At $100 or more, consumers can buy sport shoes that are laced with technologies that provide better fit, more cushioning, last longer and often include materials such as suede or metal that don’t make it into lower-end models, says Ernest Kim, who tests and reviews basketball shoes for Sole Collector magazine. Other elements simply add style. Metal eyelets instead of plastic in the Zoom LeBron and a synthetic suede-like upper in the Jordan Melo 5.5 are small details that help drive up the production cost.
Customers have balked at price increases before. Nike’s Air Jordan franchise is the best-selling shoe brand of all time, but when the company tried to sell a $200 shoe in 2002 that came in a flimsy metal case with a CD-ROM, sales tanked. Still, Adidas this year will launch a basketball shoe with a computer chip imbedded in the midsole. San Antonio Spurs’ center Tim Duncan will wear the show in the All-Star Game next month. The price: $250.”