LA Times Investigates Sneaker Resale Industry As Amazon Promotes It To Kids (latimes.com) 40
theodp writes: Sneakerheads like to complain about the one that got away," writes the L.A. Times' Ronald D. White. "About haunting sneaker apps and websites yet failing to win shoe-drop raffles or find what they want at semiaffordable prices. About how the system must be rigged by resellers using bots and inside connections. Now, a scandal involving a Nike executive and her reseller son is roiling the sneaker world, highlighting worst suspicions about a booming market in which shoes can be traded like stocks. For serious sneaker collectors, this is more than a tempest in a shoebox."
In a case of remarkably bad timing, just as the ethics of the lucrative sneaker resale industry came under scrutiny in the wake of the Nike scandal and questions were raised about exorbitant pandemic-fueled profits, Amazon launched a program for K-12 students that highlights how CS makes the sneaker resale marketplace gold rush possible. "Amazon and the AWS Services are really the backbone and foundation of how we do all of our work in Data Science," explains a GOAT Data Platform Engineer in an Amazon Future Engineer lesson that teaches kids how AI and data can be used to help flip sneakers by classifying GOAT website visitors as "Hype" ['willing to splurge'], "Core", or "Under Retail" user types.
In a case of remarkably bad timing, just as the ethics of the lucrative sneaker resale industry came under scrutiny in the wake of the Nike scandal and questions were raised about exorbitant pandemic-fueled profits, Amazon launched a program for K-12 students that highlights how CS makes the sneaker resale marketplace gold rush possible. "Amazon and the AWS Services are really the backbone and foundation of how we do all of our work in Data Science," explains a GOAT Data Platform Engineer in an Amazon Future Engineer lesson that teaches kids how AI and data can be used to help flip sneakers by classifying GOAT website visitors as "Hype" ['willing to splurge'], "Core", or "Under Retail" user types.
Teaching (Score:4, Insightful)
Teaching kids how data science works? Showing them exactly how their data is being used by retailer web sites? How terrible!
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Doesn't seem to be a cautionary tale: "Hear from real team members from GOAT, including co-founder and CEO Eddy Lu, about how they've grown GOAT from startup to global empire." Also, it'll be interesting to see how the College Board reacts to the idea of AP CSP projects created as part of the GOAT program by HS students with Amazon's "help" and submitted for 30% credit on AP exams: "Included in this program is a specially designed track to help AP CS Principles students complete their Create Performance Tas
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As a kid you have learned that while driving they could be Police Cars parked out of site, just waiting to pull you over and give you a ticket for any traffic violation. You accept this as fact, and not at all outraged that the government is hiding officials just as an excuse to catch you breaking a law to provide a fine, that will offset tax expenses.
Kids today expect their data being tracked and monitored. That is just how the world works.
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No, I hate traffic cops even I can't stop them. I look out for traffic cops and learn their hiding places so that I can avoid them.
I also block as much tracking and monitoring as I can.
I live with things I cannot control but that doesn't mean I like it or that its okay or that I should just accept it. Fuck you.
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At the same time, many people signal oncoming traffic that they have spotted a hidden cop. I have even seen businesses putting a warning on the sign the cop car is hiding behind.
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Schools actually made a valiant attempt to end sneaker culture and shoe envy in general. It actually causes lots of problems if kids are primarily concerned about keeping their shoes in printing order. It disrupts school when kids spend their days selling shoes.
It is actually the parents who forced the s hoops to let their kids wear these sho
Scam or scum? (Score:3)
There were scam auction sites that advertised late night. Unlike regular auctions, they charged you to bid, $1. If you lost, tough luck.
The goal was to get many people to bid to pay for the item, then the winner got it.
Basically it was a lottery system. Buy a ticket, have your gamble bid, irrelevant mathematically. Beyond potential fraud for a confederate to make the final, winning bid, the companies "reserved the right to cancel auctions", which was to stop auctions like a car from ending if the total bids x $1 didn't pay for it.
Re:Scam or scum? (Score:4, Informative)
There were scam auction sites that advertised late night. Unlike regular auctions, they charged you to bid, $1. If you lost, tough luck.
The goal was to get many people to bid to pay for the item, then the winner got it.
Basically it was a lottery system. Buy a ticket, have your gamble bid, irrelevant mathematically.
Unlike a normal auction, the system is a classic case of behavioral economics at work. Since bidders pay for each bid whether not they win, the cost of one more bid is small compared to the "loss" of funds already used to bid, so they are likely to keep biding to avoid the loss. As a result, the site makes aa large profit on the bidding. In addition, by offering the item for sale at, say retail, and offering to credit the cost of bidding if a bidder buys the item, they are likely to get follow on sales as well since the bidder can "avoid the loss." it's a variant of the example where you offer something of value, say $100, for bid starting at a penny with the proviso whoever is in 2cd place at the end has to pay the amount of their bid, which results in a bidding war between the last 2 as each want to avoid being the losing bidder.
Beyond potential fraud for a confederate to make the final, winning bid,
Given the way the system works, I'd say a shill bidder would be more likely than a rigged winner; if only because someone wining an iPad fro $20 is likely to tell friends who may join in the bidding. It's like when Steve Martin in "The Jerk" (start at 0:53) [youtube.com]learns the carnival game operator wants people to win prizes because they cost him less than what people pay to play.
the companies "reserved the right to cancel auctions", which was to stop auctions like a car from ending if the total bids x $1 didn't pay for it.
Of course, they can cancel because they'd never actually sell a car for $10, they just want you to think they will.
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I don't understand why would they not sell a car for $10 if its say 20k car and they have attracted 30k bids for $1?
Seems like pretty good margin to me.
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The idea is that they won't sell a car if the highest bid is $10 and there are 11 bids (i.e. they will only receive $20).
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I don't understand why would they not sell a car for $10 if its say 20k car and they have attracted 30k bids for $1?
Seems like pretty good margin to me.
They would, if enough bids are placed; the key is each bid costs something, you pay a set price for each bid you make. So if each bid costs say $1 and bids increment one cent at a time, $10 represents 1000 bids and $1000 in revenue for an item that is "sold" for $10. That $80 iPad that retails for $300 may have brought in several hundred dollars above the actual cost to the site from the bidders buying bids. So as long as enough bids are in they'll gladly sell you a 20K car for $3000 final bid price becaus
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Just because it makes Economic sense, it doesn't make it right or moral.
This particular scam is an obvious unethical process.
When making a business transaction there is mutual degree of risk for both side. The Buyer risks overpaying for a product, the Seller risks selling the product at too low of a price.
If you are going to auction a product the responsibility of the seller is to set the minimum bid which is the lowest limit that they are willing to part with the product. The buyers then place upward goin
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Just because it makes Economic sense, it doesn't make it right or moral.
I agree. My point was not defend their business model but to explain why it works so well.
This particular scam is an obvious unethical process. When making a business transaction there is mutual degree of risk for both side. The Buyer risks overpaying for a product, the Seller risks selling the product at too low of a price.
That risk is always there. I've seen people pay more for an item at an auction than if they went to a store, and have bought valuable items for a tiny fraction of their real worth because no one else realized what it was.
If you are going to auction a product the responsibility of the seller is to set the minimum bid which is the lowest limit that they are willing to part with the product.
Not always, No reserve auctions are a perfectly legitimate way to sell an item.
The buyers then place upward going bids competing with each other until they hit a point where the price isn't worth it for them. It is Supply and Demand in action and the Auction process is a good way to follow that. However by taking in money for every bid a person takes in itself isn't that bad of an idea, but canceling the bid if it is too low or for what ever reason and not refunding the bid payments is crossing the line, into a scam.
No one is saying tehy don't issue refunds if the cancel an auction, I would guess they do or face legal problems. The
Just read the original bloomberg articles (Score:3)
Original article https://www.bloomberg.com/feat... [bloomberg.com]
follow up: https://www.bloomberg.com/news... [bloomberg.com]
and again: https://www.bloomberg.com/news... [bloomberg.com]
First I've heard of this, seems really stupid. (Score:5, Insightful)
The sneakers in question seem to be incredibly expensive so this is something for wealthy kids. It creates a norm of caring unnecessarily about expensive clothing. With baseball cards, kids at least learn a little bit about numbers and percentages. With Pokemon or Magic cards they at least learn some reading skills and tactical thinking. This? Collecting sneakers has no such benefits. And no game associated with it. Just naked consumerism and conspicuous displays of wealth for their own sake.
Now pardon me, there are some kids on my lawn I need to yell at.
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The sneakers in question seem to be incredibly expensive so this is something for wealthy kids.
To the average person it seems like this would be the case, but in reality it is not.
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To the average person it seems like this would be the case, but in reality it is not.
The type of response the average person might think valid, but in reality it is not.
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Incredibly expensive yet only costing a dollar or two to manufacture by slave labor in a sweatshop.
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Sneakers are the new Tulips... actually there are many many things these days that are very Tulip.
Shoes?!? (Score:2)
It's a freaking pair of SHOES, dumbasses!
Sheesh.
Seriously! SHOES!
Ethics? (Score:1)
Very comical irony of "ethics" in a re-sale industry...used cars, now used sneakers that are sold online via Amazon.
But nothing gets in the way of making a profit...teaching kids that by example. Ethics? Well in today's culture its who has the most toys, the most profit.
A Ferengi rule of acquisition for this sneaky sneaker re-sale industry would be the 48th rule of acquisition, "The bigger the smile the sharper the knife."
JoshK.
Gosh, it's almost as if... (Score:1)
...someone should invent a mechanism whereby users can view a public record of all the transactions that have occurred for a collectible shoe. It sure is too bad there isn't anything like that available in the world today.
What's new? (Score:2)
People decide some absurd item is collectible. Then a market springs up around it. Then some boatload of fools decide that item is valuable just because of scarcity.
They're shoes.
It seems to me as interesting as limited edition Hanes underpants.
Idiots Get What They Deserve (Score:1)
Look, if it makes you happy to spend 10x what you should on a pair of sneakers that you'll never wear, then more power to you.
But, you've got to be some kind of idiot to pay hundreds or thousands for a pair of shoes that shouldn't cost more than $60. It's analogous to the idiocy that spends thousands to millions on Non-Fungible Token(NFT) stamped digital art.
The big question is; How do such morons acquire the funds to participate in this crap, in the first place?
"Sneakerheads" ... (Score:1)
Jeez... get a life! The stamp collectors are laughing at you!
pikers (Score:2)
I've got these sneaker-auction scammers beat: I'm gonna start selling sneakers with an NFT embedded in them.
Not Stocks... (Score:2)
"...a booming market in which shoes can be traded like tulip bulbs."
Fixed it.
But we need ... (Score:2)
Seriously? (Score:2)
highlighting worst suspicions about a booming market in which shoes can be traded like stocks
If people think shoes are traded like stocks then those people deserve to be taken for everything they are worth.
You Live Long Enough to Watch the Poles Reverse (Score:2)
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Welcome to the 1960s? Where have you been?
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America sinking to a new low (Score:2)