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|| THIS WEEK IN COLLECTIBLES NEWS ||

💵 Good News From Adidas Earnings Call

🤝 Nike and Bape Settle Lawsuit

👟 On Running With A New FKA Twigs Collaboration

🏬 JD Sports’ Big Acquisition of Hibbett

🧥 Louis Vuitton Launches Phygital Collection

🏀 Caitlin Clark Lands Milestone Nike Deal

Good News From Adidas Earnings Call

Adidas has just reported overall better than expected financial results. While North America was their weakest market, they have seen strong growth in Europe and Asia.

This is all good news for CEO Bjorn Gulden, who has stared down challenges like dealing with the Yeezy fallout (both Kanye and the shoe inventory) and losing the decades long partnership with the German national football team.

In his tenure of just over a year, Bjorn has performed pretty well--or at least better than his competitors, which is one of the biggest things that matters in financial markets. Bjorn comes across better than Nike CEO John Donahoe, who has experienced more declining growth, layoffs, and generally poor PR in comparison.

In the lifestyle shoe category, the Adidas Samba, Campus, and Gazelle are dominant global players. Depending on how you look at it, the Adidas Sambas are currently the most popular shoe in the world.

As all businesses get increasingly more data driven, Adidas' ability to track the success of their shoes and their competitors' shoes will ensure they remain savvy with their decision making.

Nike and Bape Settle Lawsuit

Nike is well known for being litigious, or at least more litigious than their sneaker rivals.

Among other individual designers and companies Nike have sued for trademark infringement, one of their biggest lawsuits has been against Japanese streetwear brand Bape.

Nike accused Bape of stealing their Nike Air Force 1, Air Jordan 1, and Dunk designs to create the BAPE STA, BAPE STA Mid, SK8 STA, COURT STA High and COURT STA. These Bape shoes have been relatively popular models in the sneaker & streetwear crowd, though Bape's overall annual revenue is estimated to be in the low hundreds of millions, which puts them in an entirely different, smaller category when competing against Nike.

The lawsuit between the two brands has been settled in a New York court, resulting in Bape discontinuing certain sneaker lines and modifying the designs of others. This won't likely have a large impact on Nike's bottom line, but it sends a message to other brands that Nike is willing to aggressively protect their IP in court.

For many years, there has been talk in the sneaker industry about Bape shoes being just a little bit too closely resembling Nike shoes. Many people felt this lawsuit has been many years in the making and indicates Nike's seriousness to protect their brand in an increasingly competitive and lower margin sneaker industry, as Nike has sued several parties for infringement over the last two years.

👟 On Running With A New FKA Twigs Collaboration

On Running has been a growing upstart sneaker brand over the last few years. Putting aside their product excellence and marketing strategy, they have benefitted from their close association to Roger Federer, who is not only the face of the brand but also a co-owner.

Deciding on future collaborations is an important step for On and their latest collaborator is with British musician FKA Twigs, with whom they are launching a new sneaker and apparel line.

FKA Twigs helps strengthens the brand identity and messaging of On Running. FKA Twigs isn't necessarily an indie artist, but she's not necessarily a huge mainstream pop singer. It's hard to imagine her being an obvious brand ambassador for Nike or Adidas, so On is taking a bold step associating themselves with her.

There are sometimes major sneaker collaborations with musicians, but they more often occur with athletes. And the sneaker collabs with musicians are often with massive artists like Travis Scott or Billie Eilish.

FKA Twigs is an interesting choice for a sneaker collbab, a kind of indie, even avant-garde choice. And for a Swiss shoe brand known more for athletic performance and avoiding the hype, maybe FKA Twigs is the right choice for them to build upon that counter-positioning against the bigger sneaker brands.

🏬 JD Sports’ Big Acquisition of Hibbett

JD Sports is buying US retailer Hibbett for $1.8 Billion, expanding their presence in the US.

JD Sports is a British company that's one of the biggest sports retailers in the world, but has a much less dominant presence in America.

JD already owns Finish Line & Shoe Palace but the new acquisition gives JD 1,169 new Hibbett owned stores across the US, which pits them directly against rivals like Foot Locker and Dick's.

Sneaker retail has constantly been looked down as a flailing market. While brands like Foot Locker and JD Sports have struggled over recent years, there will still be a place for physical retail stores and the current industry trends might lead to more competitiveness between these companies.

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🧥 Louis Vuitton Launches Phygital Collection

Louis Vuitton is launching a new phygital (physical + digital) collection that involves a €7900 varsity jacket and a corresponding digital counterpart in the form of an NFT.

People can buy an NFT digital collectible of the jacket and receive the actual physical jacket in November or December. This is only available to holders of the Louis Vuitton Via NFTs that came out last year. These NFTs are "non-transferrable" and you had to apply to own a Via NFT.

The first drop of the Via NFTs featured phygital treasure trunks for €39,000 and there have subsequently been a number of product drops. Some celebrities were gifted Via NFTs and the overall number of NFT holders numbers a few hundred.

LVMH has approached Web3 with an open mind, taking on several projects across different brands in the holding company like Louis Vuitton and Tiffany & Co.

While the user experience of NFTs still might be challenging for most people, the concept of exclusivity and luxury is still well understood by fashion brands and their VIP customers, whether we're talking about physical or digital products.

In the midst of a very rough NFT market, LVMH is still making bold moves to indicate they remain interested in NFTs.

🏀 Caitlin Clark Lands Milestone Nike Deal

Caitlin built out an incredibly successful college basketball career at the University of Iowa, becoming highly regarded as one of the best and most popular college basketball players in the country. This also translated into new record viewer ratings for their games.

Caitlin is currently in discussions with Nike to finalize an eight-figure deal that includes the creation of her own signature sneaker line. This comes after a competitive process where pretty much all footwear brands tried signing the young star.

A condition was set that the winning brand needed to pay her at least $3 Million a year. And having a new signature shoe line gives Nike an opportunity to create a new sneaker that should be attached to an athlete who has a long, successful career ahead of them.

The WNBA is growing in popularity and Caitlin Clark is seen as the "next big thing" the same way people look at exciting young NBA players like Victor Wembanyama and Luka Doncic.

I've spoken to a lot of people who think that Nike could do a better job catering to their female customers, and part of that includes partnering with more female athletes.

Most sneaker brands face the same challenge and want to do a better job prioritizing female athletes. So Nike winning the competitive bidding process is a big win for the brand and maybe a big win for women's basketball shoes?

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This newsletter was written with contributions from Neustreet Editor-in-Chief Tony McGuire; art generated by Logan Fulcher.