- 8,799
- 10,386
It's pretty simple, the consumer showed their hand when Nike saw what the resellers were getting away with.
The equation is simple. If resellers sell their product for 350 and it retailed for 180 then you factor in the percentage of consumers who missed out on retail willing to spend X amount more. Not all consumers are willing to spend 350 but some are. Well what will all consumers be willing to spend while retaining a sell out. The answer is between 220 and 250.
There's a sweet spot on the msrp. They need to sell out but not be worth the resell.
Nike is in the middle of figuring it out. The low end of that range being what they went with says that they're just as surprised at the real retail value as we are. They keep them at 220 for either reluctance or mercy.
This has nothing to do with the economy. Nike is starting to realize they are basically printing money. They are their own economy.
The equation is simple. If resellers sell their product for 350 and it retailed for 180 then you factor in the percentage of consumers who missed out on retail willing to spend X amount more. Not all consumers are willing to spend 350 but some are. Well what will all consumers be willing to spend while retaining a sell out. The answer is between 220 and 250.
There's a sweet spot on the msrp. They need to sell out but not be worth the resell.
Nike is in the middle of figuring it out. The low end of that range being what they went with says that they're just as surprised at the real retail value as we are. They keep them at 220 for either reluctance or mercy.
This has nothing to do with the economy. Nike is starting to realize they are basically printing money. They are their own economy.