Allbirds: On the precipice of greatness?

Can Allbirds create the hype needed to disrupt the sneaker market as never done before?

WORDS Adam Bryce
Photography Art Dept

Up until the 70s sneakers weren’t such a big deal. By the 80s/90s they weren’t only the footwear of choice but a marketing battle ensued, a time often referred to as ‘sneaker wars’.

The owners of adidas went their separate ways (one brother starting Puma) and competed against each other to dominate a new hip hop scene. Nike and Reebok competed for the majority share of a new aerobics market. And they all invested big time in basketball with Nike coming out on top, in part, due to taking a punt on a young basketballer named Michael Jordan.

It was not only a huge period of growth in a new market but it had established a group of brands that were, over time, going to prove impossible to penetrate. The four companies’ market share was impenetrable and the growth in this period was so steep, it was to make any newcomers’ task very daunting. This said, by 2017, the growth of these brands would make the market a US$62 billion industry which was growing end-on-end each year. It was a market that had more than enough room for new players.

How could a new brand make waves in an industry dominated by massive players steeped in cultural significance? Over the years, there has been no shortage of newcomers, not one, however, making any significant inroads into the market.

But, of late, we’ve started to see considerable change in the way that consumers think and purchase. With this, has come a potential problem for established players in the industry. Brands that have built their name around values important to the consumer during the 80s/90s are now finding it hard to pivot to a new world despite all their resources.

The footwear brand GREATS, for example, are influencers in a direct-to-market model with a value proposition of cutting out retail and producing a luxury sneaker line that was more affordable. But outside of their innovative business model, they haven’t been able to build brand credibility. As most of us know, value doesn’t hold a huge amount of street cred.

Li-Ning, China’s answer to Nike and adidas building massive manufacturing infrastructure on their soil, have started to make small progressions by essentially aping Nike’s marketing strategy. Whether it’s a sustainable model is a different story and yet to be determined.

Veja, an independent casual sneaker brand with sustainability at its core, have made some significant inroads into that specific market of which the likes of Nike and adidas see as hugely valuable. Veja’s growth has been organic and the result of consumer’s changing mindset. There are questions over whether Veja has the potential growth to worry the bigger players. Their market share, while better than most newcomers, is still minute in comparison and there hasn’t been any publicly significant signs of business model development which could propel the type of growth required to really make a dent in the market.

Then, there’s Allbirds.

A brand born in New Zealand and, most importantly, inspired by New Zealand and the exceptional qualities of their merino wool. A sustainable sneaker brand unlike any other, Allbirds haven’t attempted to replicate existing and expected sneaker styles from sustainable materials, instead designing footwear with a new material to the market.

Interestingly, Allbirds don’t appear to have come at the market with the goal to follow but more to simply create something that they believe in wholeheartedly and back it to the hilt. Footwear that doesn’t appeal to a particular demographic but rather a consumer who relates to authenticity. Their quickly-becoming-iconic styles, ‘Dasher’ and ‘Wool Runner’, are minimal and understated which reinforce the integrity in the values of the brand. There are no bells nor whistles, simply a genuine belief in offering a sustainable and functional option in the market. 

It seems like the right approach to take in order for a company to finally disrupt the status quo of the sneaker market but it’s Allbirds’ business approach which has us believing in the potential. They’ve gone through numerous rounds of funding to get the brand to where it is today and have recently raised another US$100m in capital to enable its growth into new categories.

While we don’t know their strategy for the next round of growth, the one segment of the industry Allbirds are yet to make any real growth in is the ever-growing ‘hype’. A market of early adopters looking for newness, street cred and prepared to go to extreme lengths to consume. 

In February 2005, the hype market was very much in its infancy but there was an underground stirring of change, something significant was happening. A secondary market was starting to develop in interesting ways with people willing to pay exorbitant amounts of money for sneakers.

Digital media channels like HYPEBEAST and SLAMXHYPE were starting to compete with traditional media, and the likes of Nike and adidas were starting to approach the modern media in a new way. Nike, in particular, began to work with influencers within this subculture to gain a better understanding of how it operated. One of those tastemakers was Jeff Staple, the owner of New York retail store and gallery Reed Space. They collaborated to create a minimally designed sneaker inspired by New York’s pigeons which were an icon of Reed Space’s in-house brand Staple Design. The ‘Pigeon Dunk’ shoe was crafted in small numbers with only 150 made and a mere 30 available at Staple’s own store. His, a little more special though, with each individually numbered.

The footwear release saw a whole new phenomenon with keen buyers setting up camp outside the store overnight in hopes of nabbing a pair of the individually numbered sneakers. The hype on the streets and internet clearly making it obvious the demand would well outstrip supply.

Some 15 years on and this is a normal facet of sneaker culture. Most weeks, sneaker stores, in all parts of the globe, will have hundreds of camp chairs and sleeping bags set up outside their doors, accompanied by those looking to get their hands on a shoe that they’ll either keep to build credibility amongst their peers or sell for a handy profit.

And so, what better way for Allbirds to enter the hype market than by collaborating with Jeff Staple himself to design their own version of the ‘Pigeon Dunk’ created all those years ago. A symbol for a new movement in sneakers, the shoe shares the same colour palette as the original and the same pigeon icon on the heel but the highly sustainable makeup of the shoe is something completely 2020.

Could this be the beginning of a strategy that, for the first time, might see the big players in this industry truly disrupted? Only time will tell but, to this point, Allbirds have done everything right and are without doubt the market’s next biggest hope.

allbirds.co.nz

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