The sneaker game is difficult to break into.
Nike--and by extension, Jordan Brand--dominate the hype cycle, and kids have no problem braving frigid cold or chaotic lines for the chance to spend their hard-earned money on something rare, and, sometimes, very ugly. This scarcity model perfected by Nike's elite marketing machine doesn't just breed a thriving secondary market for resellers (a coveted pair of Jordans can casually fetch $500--easy), but it makes it incredibly challenging for young, upstart brands to etch a name in the fashion world.
Which isn't to say it can't be done. In an industry where reputation is everything, Common Projects, a latecomer that launched in 2004, has been able to carve out an enviable niche aside established shoe giants by winning over influencers, selling minimally branded but classic silhouettes cut from premium materials. The catch, of course, is that a new pair of CPs will run you about $400.
"The perception is the more you pay the better it is," says Ryan Babenzien, cofounder of Greats, an online-only footwear brand based out in Brooklyn. "It's our job to prove and show to the consumer how inefficient the wholesale business is, and why they pay a different price there."
Along with his partner, streetwear design vet Jon Buscemi, Babenzien (a former marketing director at K-Swiss) is out to subvert the existing hype model by offering high-quality, premium footwear at Payless prices.
Aesthetically, Greats's shoes are more understated than attention-grabbing. Its design principles tap classic silhouettes, lacing them with subtle luxe details like pebbled leather toe caps and glitzy, metallic colorways. Two months after a limited soft launch in 2013, the company sold out of its product inventory, and the starting price point for its sneakers is very wallet-friendly ($59). Its target market is equally ambitious: Greats says its ideal customer inhabits the slim but influential Venn circles of streetwear and menswear--an ideal consumer that is "very, very difficult to get, especially for a brand as new as ours," says Babenzian.
On Tuesday, Greats announced a $1.5 million seed funding round, led by Resolute Ventures. Its business model works like this: By selling directly to consumers via its website, Greats can eliminate the 2x-3x markup that comes from wholeselling luxury shoes to third-party retailers--all without the giant marketing and inventory infrastructure of big corporate competitors.
In other words: Greats would like to do for footwear what Warby Parker did for eyeglasses.
By skipping the middle man, "we're able to make a very good product, and sell it at a much lower price," says Babenzian, who says the idea behind Greats was conceived three years ago. "We watched Warby Parker, Everlane, and similar ideas come around, but with different products."
Obviously, the forces driving the sneaker economy are different from dork-chic eyeglasses. Menswear nerds don't all necessarily love their prescription bifocals the same way they love their Jordan IVs. And customers will have to put considerable faith that Greats can deliver a quality shoe without the convenience of being able to try them on in person. (Although returns are free.) "The challenge," says Babenzian, "will be: How do you build a cool brand without being a cool brand in a cool store?"
And yet, despite the pitfalls that starting an online-only business presents, Greats has been able to attract the attention of heavyweight style influencers. Kanye West is said to be a fan. And Nick Wooster--a menswear fashion icon whose tattooed visage you may have seen on Tumblr--collaborated with Greats for a limited edition "made in Italy" slip-on. The quality is there.
But building a classic shoe brand takes time. And the icons of today's sneaker landscape didn't have to deal with the Internet's angry army of armchair fashion critics: Vans, for example, has been around since 1966. Puma and Adidas, meanwhile, split from the same German footwear brand that began all the way back in 1924. In today's hyper-condensed fashion blog cycle, time is a luxury that Greats simply might not have. E-tailers today have to deliver--and deliver fast.
But Babenzian is optimistic. He's confident that he and Buscemi can build a classic shoe brand quickly, while still delivering on boutique-level quality. Greats plans on rolling out 10 new styles of shoes this year (previously, it only had three models), and Babenzian believes the shoe startup can change the longstanding perception held by fashion bros that immaculate kicks are synonymous with a sizable dent in your bank account.
"If you can still be cool, not pay a lot of money, and get really good quality, that's the trifecta of style," says Babenzian. "It's really that simple."
[Images courtesy of GREATS]