How to Make a Ton of Money Selling Streetwear
Have you ever wondered why streetwear is so expensive? Sure, you’re paying a premium for the quality of the fabric, the time that went into the design, and - if you’re lucky - the sustainability of the product. But really, these things cost a few dollars more per unit, so why are we charged up to a few hundred more bucks for the streetwear pieces we like so much?
The answer is short, but it’s far from simple. It mostly has to do with how dumb the human brain is. The more something is expensive, the more we value it. And our brain is geared to justify the choices we make, so if you pay a month’s rent for a jacket, everytime you’ll see it, you’ll subconsciously reinforce your decision.
Same thing if an item is scarce, you’ll be that much more happy you put your hand on a copy.
Marketing mastermind Seth Godin explained succinctly the secret behind creating a successful streetwear company (or any company) while he was on The Tim Ferriss Show. You’d hardly guess it by looking at him, but the guy is a true branding gangsta.
Credit : We Are Basket
LEAVE MONEY ON THE TABLE
Godin takes Supreme as the perfect example of a successful brand. Supreme knew from the jump they wanted to create a buzz, and that they would be in it to win it. They had a vision of what they wanted to accomplish : A company that went against the current of clean adult ready-to-wear and embraces youth culture.
When the NYC skate shop was founded, in April 1994, it made sure to underproduce dramatically so it would always sell out. I’m sure it was counter intuitive to leave money on the table at the time, but they knew they were in it for the long game, and by refusing to play by the industry’s rat race, they elevated themselves to the status of couture.
If you want to create a successful brand, you can’t play with scared money. You have to be ready to wait f or the right opportunities, and above all, you have to have the power to say no to anything that isn’t you.
Credit : Stratosphere
CREATE SCARCITY
Scarcity = Value. The more unique a piece is, the more the person who buys it identifies with it. The fact that you have to wait in line - or, more likely - that you have to buy it from a reseller at 10x the price creates a story around the item you’re buying, and it reinforces the feeling that it’s special, exclusive, unique.
According to Godin, the premium you pay by waiting in line, paying a reseller (or simply by obsessing over an upcoming piece and refreshing Supreme’s page every 12 seconds), that’s another way Supreme creates value. They might not get a taste from all the money the resellers are obtaining, but everytime someone sells a 200$ at 2000$, it reaffirms the worth of Supreme’s pieces on a speculative level.
Supreme’s clothes, just like fine art, are worth whatever people are ready to pay for them. Create scarcity, and, down the line, you’ll have value.
Credit : Hypebeast
HIRE SOME COOL KIDS
Influencer has been a buzz word for the better part of the 2010s, but the concept has been around for way longer than that. In the case of a brand like Supreme, having cool rappers like Kanye, Tyler or Drake wear the brand gave it an identity that no publicity campaign could’ve rivalled (and believe it, other companies tried to beat Supreme at their own game… And they failed.)
Seth Godin uses the example of a cool kid showing up at school with a yo-yo. Yo-yos are dorky, but all the kids at school want to identify with the cool guy or gal, so the yo-yo becomes a symbol of coolness that they can obtain. On the other hand, if a dorky kid shows up at school with a novelty toy, the thing will be confiscated and that will be the end of that.
Once again, our brain is dumb. When we see a cool kid with a t-shirt, we think : The shirt is cool, I want to be cool, hence I want that shirt.
We are visually stimulated beings and if you want to promote your brand, an image can be worth a 1M$ marketing budget.
Credit : Pinterest
CHARGE WHAT IT’S WORTH
Seth Godin is notorious for encouraging entrepreneurs to decide on a price based on the value of the product to the customer, and not arbitrary factors such as industry standards and price of confection.
To many artists undervalue themselves. According to the author, “cheaper is the last refuge of the marketer unable to invent a better product and tell a better story”.
But pricing more means having to hustle less. It means having more time to innovate. It’s also a way to create scarcity. You don’t have to rely on this strategy to create value, but you have to figure out how much your ideal customers are ready to pay for a piece, and then find those customers. To the right customer, a higher price tag will become part of the story.
A 42 carat diamond is not worth $100 million “unless someone actually chooses to buy it”.