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August 22, 2012

5 Better Ways to Spend $315 than Buying Nike Lebron X Olympic Edition Shoes

The Internet has been in mild uproar over the past day or two on the news that Nike is selling a pair of these Lebron X Olympic Edition shoes for $315:

Even though the idea of paying that much for a pair of sneakers sounds insultingly dumb to me, I can think of a few good reasons why Nike would think it can get away with this price:

1. Margins. If half as many people buy these shoes for $315 as the amount that would pay $150 for them, Nike makes more money.

Relatedly:

2. The $190 “stripped down” version of the shoe that doesn’t include sensors to, according to USA Today, track quickness, vertical leap and explosiveness seems reasonable by comparison.

3. The secondary market for specialty Nike designs is insane. Recently, fans waited in line at a sneaker boutique in Royal Oak, MI for over a week for the right to pay a 400% mark-up ($1,000 for shoes that retail for $245) for Air Yeezy II’s. These shoes and others like it command astronomical prices immediately on Ebay.

If the market exists, why should Nike leave money on the table for re-sellers?

To borrow an adage from my old summer camp, though, if a million people believe in a dumb idea, it’s still a dumb idea. Shoes–and especially these ugly shoes that will get scuffed up the first time you wear them outside–aren’t worth anywhere close to that much money. If you have $315, in disposable income, here are 5 better ways to spend it:

Continue reading 5 Better Ways to Spend $315…


June 27, 2012

Heat Owner Mickey Arison Says Franchise Would Be “Lucky to Break Even” and “Won the Right Way”

Yesterday, Miami Heat owner Mickey Arison went on the Dan LeBatard show and had some pretty interesting things to say about the team’s season. (Find the full conversation on iTunes–it’s the one from 6-25 labeled with James Jones and Ozzie Guillen as guests–at about the 35-minute mark.)

Photo credit: Forbes

LeBatard and Arison discussed the financial status of the Heat organization:

LeBatard: [Earlier], you corrected me on saying that you were running a business. Was that correction because, basically, the Miami Heat haven’t made enough money the last 20 years and this is the first time they’ve turned a profit in the last couple?

Arison: We have lost money every year except the first year LeBron was here and we have lost hundreds of millions of dollars since we built American Airlines Arena. I don’t know if we’ll make money this year or not until all the numbers come in. Obviously, having a playoff run including a seven-game series helps a lot but with the new luxury tax–the new revenue sharing–I think we’ll be lucky to break even but I don’t think we will break even.

LeBatard: Can you explain that to somebody who doesn’t understand, Mickey? Because that doesn’t seem to make a lot of sense. I don’t understand how that can possibly be–where you have the most successful basketball team in the world and you can’t make money.

Arison: It’s the system. It’t the market. Just to give you a sense of numbers–and this is just ballpark, right?–my guess annually 20 million dollars for my TV rights. Teams like the Knicks, or Chicago, or LA will get between 75 and 150. My gate could be a million, a million-1, a million-2. Madison Square Garden is 2.5 million. And guess what? My salaries are the same as those guys. If you’re New York, Chicago, or LA, it’s a business. Anywhere else in the country, it’s a hobby.

Continue reading Heat Owner Mickey Arison Says Franchise…


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