Jack Crivici-Kramer

Yes, we told you about the comfort economy, but New Balance's sneaker surge actually goes way deeper than that.

Jack, any chance we got a sports analogy here we could drop on the besties for the show?

Nike fumbled.

So New Balance picked up the ball and ran it to the end zone.

It was a scoop and score situation.

And here was Nike's original sin.

They pulled their shoes out of third-party retailers like Foot Locker so they could sell direct-to-consumer online in their own Nike stores.

So New Balance simply filled the void.

They loaded up Foot Locker with boxes and boxes of suede 990s, which sold way more than before.

Okay, that was step one.

Then step two for New Balance is they went primo.

They went upmarket premium.

They did luxury collabs to associate New Balance with Gucci instead of the gridiron.

And that cultural cachet and that cool factor let New Balance increase their prices by 30% over the next five years.

And yet you and Justin Bieber both paid for that pricier shoe anyway.

which leads to the third part of New Balance's master plan.

That cultural cachet allowed New Balance to pick the best athletes for endorsement deals, something Nike is historically the best at.

Shohei Ohtani, Coco Gauff, Josh Allen, all of them team New Balance.

So now New Balance is saying, hey, Nike, go ahead and take the Olympics.

Enjoy the spotlight, the medals, the podium, and all that.