Real or Fake: There Is No Such Thing as a Grey Market for Sneakers

A look into how sneakers get leaked, and why we’re so confused about their authenticity.

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When it comes to the sneaker community, authenticity is everything — at least at one point it was. In the earlier days of Internet sneaker culture — think Nike Park, 23 Jumpman St. and the earliest days of Niketalk — you had to earn your respect over a number of years. Whether it was dropping knowledge, helping individuals score a pair of kicks not available in their hometown, sharing photos of your authentic collection or just being a good honest person; you couldn’t just show up one day with a bunch of PEs or colorways people had never seen before and not raise a couple of eyebrows. Even more so, if you were going to start promoting a website you better make sure they were selling the real deal or be prepared for some serious backlash.

Fast-forward to 2016 and that earlier foundation seems to have shifted.

These days its more important to be “lit,” garnering 100k subscribers in a week via YouTube or maybe Instagram with a bunch of early release shoes from a counterfeiter in Putian, China, that you’ll be sure to plug in a video. In 2016 you can trick people into believing you’re more knowledgeable and credible than you really are, simply via purchasing subscribers and likes. Gone are the days of people having to legitimately earn a title of OG when you can just buy it and have companies knocking on your door to hand out some freebies. In the words of B.I.G.: “things done changed.” It’s this change that has led to an infiltration of high quality fake shoes marketed as “grey market.”

Over the years fakes have become so good that most knowledgeable people have a tough time being able to tell the difference between the real deal and the fake. These high quality fakes — or “grey market” shoes as some have come to know them — have caused many to adopt a retail-or-bust motto. Couple all this with a largely uniformed newer generation of collectors and sellers eager to own something before the next man or flip shoes for a very sizable profit and you have a recipe for disaster.

The “Grey” Market

The whole subject of grey market shoes has become a very sensitive topic over the years and one that’s seen a lot of heat surrounding it. Many argue or generalize that the “grey market” shoes are nothing more than the retail pairs hence without the companies “blessing.” Others have argued that even if the difference is only “the companies blessing” — in most cases this is not the only difference — and are not a B-grade (which is an authentic shoe manufactured by the company with a defect that is sold at a legitimate factory outlet) that the shoes are still unauthorized and therefore regardless of its quality in comparison to a retail pair would be considered fake and therefore not covered by a companies warranty.

Usually, fakes were sold at a fraction of the original retail price, but with these newer ones being available months before a retail pair and with quality that is similar to the real deal, many are paying over retail to be the first on the block with the latest and greatest or to make a fast buck before they hit retailers. This of course is fueled by the possibility of Instagram and YouTube fame and in some cases new found wealth. In some cases — as stated before — these same individuals receive free product with the promise of promoting the site that is supplying them. Down the line they may turn around and unleash these shoes into the market place without disclosing where they purchased or received them. In some cases people have even begun to fake receipts from major retailers to further trick potential buyers.

Supplied PDX

This debate was recently re-ignited again when a large online sneaker store “Supplied PDX” was shut down by agents from the IRS and Homeland Security. According to KOIN, “the investigation started in March of last year when Nike revealed that its private team of specialized investigators conducted a “discreet” probe into the online retailer, owned by James Pepion.

In the report, the website is accused of selling stolen, counterfeit and grey market Nike Jordan shoes and unauthorized pre-releases. Also in the report Grey market shoes are acknowledged as being made from real or potentially stolen components outside of authorized Nike factories.

The report goes on to say that:

“After agents served Google with a search warrant, they were able to track an email that belonged to a Chinese national who is suspected of thefts of samples and components from Nike manufacturing partner facilities in China, according to records. The man is also said to have organized the sale of stolen samples and counterfeit Nike and Air Jordan shoes.”

This in stark contrast to the widely circulated theory that all or most shoes marketed as “grey market” are being made in the same factories the real shoes are being made.

Factory Suspicions and Other Security Breaches

Image via Reuters

This story also rehashes memories of a 2010 New York Times article where a man by the name of Lin provides great detail of what exactly is going on with the manufacturing of these higher quality fakes. Lin described his ability to purchase an authentic pair of sneakers, take them apart, study their stitching and molding, draw up his own design and then oversee the production of 3000 Nike clones. He goes on to say that counterfeiters “played a low-budget game of industrial espionage, bribing employees at licensed factories to lift samples or copy blueprints. Shoes were even chucked over a factory wall at one of Nikes Putian factories and it wasn’t unusual for counterfeit models to show up in stores before the real ones did.”

With increased security though this has become increasingly difficult and so he went on to explain how they will just go to a shop that sells the real shoes and duplicate them. He also confirms what many have argued for years about grey market shoes, which is that “counterfeits come in varying levels of quality depending on their intended market. Shoes from Putian are designed primarily for export, and in corporate-footwear and intellectual property rights circles, Putian has become synonymous with high end fakes, shoes so sophisticated that it is difficult to distinguish the real ones from the counterfeits.” What really stood out was when he stated that: “we’ll use all the same materials. All the best materials are available in Putian” but also explained that using the same materials would drive up the price (hence why many of these grey market “early release” shoes are sold at or above retail).

Then of course there is Nike’s WikiLeaks from 2011 that lays out in great detail the complexities Nike faces protecting its brand.

The History of Fake

Image via Andrew Bettles/The New York Times

While this information is insightful the real question then from a consumer standpoint is how can this be stopped? Of course the immediate answer is that it cannot be stopped, at least mostly. Fake shoes will likely always be there but if you have a passion for footwear then you shouldn’t want to just grin and bare it. Instead we should begin by looking at who’s to blame, starting with the companies themselves.

Lets face it, knock offs and fakes have been around for decades. Footwear companies themselves have been knocking each other off dating back to the earliest days of the Chuck T. In the ’70s, ’80s and ’90s you had John Smith, Olympian and companies like U.S.A. Olympics – a brand owned by JC Penney that was selling what many would term “designer imposters” for decades even going as far as pushing sneakers with adidas three stripes on the shoe and for cheaper than adidas; living off of borrowed designs. Still, none of these companies were representing the shoes as authentic product of a competing brand and up to that point you could spot a fake or knockoff and realize it fairly quick — maybe those U.S.A. Olympics adidas knock offs not so much – but the point is clear.

By the late ’90s and early 2000s during the infancy of Internet sneaker culture, fakes begun showing up in droves. If you were around to collect at the time then you’ll vividly remember the amount of fake Air Max 95s, Retro IVs and of course Jordan XIs that flooded eBay. It got so bad that early on many were confused by the early fakes of the Jordan XI and mistook them for authentic samples in colors that never hit retail or exclusives from the brand. Ultimately they were discerned as fakes and those that spent hundreds and sometimes thousands to own them were left with worthless fakes. As years passed many celebrities that individuals recognize as big shoe heads today were caught out there wearing fakes.

Once 2005 rolled around, fakes had become so rampant that they showed up in a legitimate Jordan Brand advertisement, and again in 2006 on an officially licensed t-shirt sold at Finishline which was later recalled.

Where We Are Now With Fakes

By the time blogging became big business and YouTube videos could turn you into an overnight celebrity, lots of new faces had begun to flock to the sneaker scene. Many of these individuals were not that knowledgeable on the subject but whose rise to notoriety in the community was by way of showcasing “early release pairs” aka high quality fakes that would then be promoted in their videos by way of a name drop thus giving these sites more exposure and more opportunity to rip off unsuspecting consumers. The companies that were so aggressive at fighting counterfeiters begun to send mixed messages to the community when these same individuals who unknowingly were buying and promoting fake shoes on their YouTube channels — but had garnered a large following doing so since they were viewed by an unsuspecting public to have some sort of special connection — were now being invited by those same brands and put on the forefront as an influencer’s.

So this brings us back to the message board wars where many have lost sympathy for the brands and individuals that are buying these shoes. For the guy that doesn’t care whether or not his shoes are real or fake then all of this is irrelevant, but for the person that does it makes buying a high demand shoe tough.

In addition there are those that argue if companies are so concerned with their product being counterfeited in these countries then they should move manufacturing elsewhere. In China, Jordan brand recently lost a lawsuit against Qiaodan Sports, a brand that had clearly ripped off their designs in a more indirect way. The message here being that if one of the most powerful companies on the face of the Earth can’t defend a clear patent infringement in the country they have employed to manufacture their shoes then they must decide whether or not it is worth it to continue to manufacture there. The clear answer as of now is that the good must outweigh the bad and so for that its hard for many people to feel sorry for them.

In the meantime if you want to make sure the product you are buying is the real deal then you’ll have to do your homework should you decide not to buy direct from Nike or an authorized retailer. Legit checks are always popping on Niketalk and Sole Collector forums and there is even an Instagram account dedicated to helping the community. At the end of the day if you are concerned with your sneakers being 100% legit then its retail or bust.

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Scott Frederick/Defy. New York

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