Nike's $300 Shoe Has the Marketing Built Right In - AdAge.com

How do you market a pair of $300-plus sneakers? If you're Nike, you just do it quietly. And by acting like you're not marketing them at all.

Nike found itself embroiled in the middle of another controversy this week when news surfaced that it's planning its most-expensive sneaker ever: the LeBron X. A high-end version of LeBron James' signature shoe embedded with Nike+ technology will cost $315, The Wall Street Journal reported.

A price point of $300 or more for a single pair of kicks has been the equivalent of the third rail in the $2.8 billion U.S. basketball shoes business: rarely approached, potentially lethal if crossed.

Once the news got out, Nike was immediately ripped for pushing more overpriced sneakers during an economic recession. Marc Morial of the National Urban League called on parents not to waste their money on an "empty status symbol" and to use it on books instead.

"To release such an outrageously overpriced product while the nation is struggling to overcome an unemployment crisis is insensitive at best," said Mr. Morial in a statement.

The Swoosh is no stranger to controversy. Or at rolling out marquee sneakers that spark near riots at retail. Let's look at how Nike has marketed the LeBron X so far:

• Counterattack. The athletic giant hasn't said what the final price will be for the most-expensive model. But it ripped the $315 price tag quoted by the WSJ as "inaccurate." Nike spokesman Brian Strong said the shoe will be launched at a suggested retail price of $180 this fall. The top model will cost more "to reflect the Nike+ technology embedded in the shoes," he said. Sneaker analyst Matt Powell of Princeton Analysis hears the Nike+ model will sell for $290 -- thereby defusing most of the controversy over $300 sneakers. The most expensive LeBron IX shoes currently go for a not much cheaper $250.
• Word of mouth. Instead of expensive ads, Nike's relying on word-of-mouth to build anticipation. Elite high school and college athletes have been talking up the high-tech shoes for six months, Mr. Powell said. Sneaker blogs are buzzing about them. And every major media outlet did stories on the LeBron X this week. "You market a shoe like that just by saying you're making that shoe," said marketing consultant Ernest Lupinacci, a former copywriter on Nike ads at Wieden & Kennedy. "They've gotten millions in free publicity already."
• Product placement. Nike had the placement of all placements when millions of NBC TV viewers watched LeBron wear the shoes while leading the U.S. men's basketball team to the gold medal at the London Olympics on Aug. 12. After years of being criticized as a choker who couldn't win the big one, Mr. James had a dream season, winning both Olympic gold and the NBA championship with the Miami Heat. It's easy to see Nike rolling out ads showing how the new shoes helped LeBron gain gold in London.

One of the strongest selling points Nike uses for shoes like the LeBron X is that they're not for everybody, Mr. Powell said. The top-end Nike+ shoe is aimed at elite athletes and consumers who want to track how far they run and how high they jump. He expects Nike to only make 25,000 to 50,000 pairs. The rarer a shoe is, the more desperately sneaker buffs want them -- if they can even get them before they're scooped up by scam artists who sell them as collector's items for double or triple the price online.

"They won't do any advertising for this shoe. They don't need to," Mr. Powell said. "This is not so much about being commercial as it is about creating hype and buzz about the brand."