UNDERSTADING THE HYPEBESAST ECONOMY - sersc
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International Journal of Advanced Science and Technology
Vol. 29, No.02, (2020), pp. 1496-1501
UNDERSTADING THE HYPEBESAST ECONOMY
Peehu Gulati
Pandit Deendayal Petroleum University
Abstract : this paper discusses the HYPEBEAST culture and its impact of the economy. This study uses
articles from popular online streetwear magazines and other scholarly articles and studies to explain
the phenomenon. The purpose of this study is to present available data in helpful way for economists.
This study will explain the concept of HYPEBEAST culture, hype, drops, and other relating terms. We
will also focus on the resale market for the goods in this market. The consumer base for these goods
shall also be looked upon. We will also see the current trends in this market. The future of this market
shall also be included in the paper.
Index Terms :drops, hype, hypebeast culture, personal luxury goods, resale market
I. INTRODUCTION
HYPEBEAST was mostly used as a derogatory term for someone who follows fashion trends, in
particular streetwear, for the purpose of making a social statement. This culture revolves around
boasting of wealth, and exclusivity. The fact that the products were limited gave the person sporting
them a different sense of confidence, and pride.The usage of the term HYPEBEAST changed
completely after sneakerhead (someone extremely interested in collecting sneakers and gathering
information about them), Kevin Ma started his website/blog with the name HYPEBEAST [1].Today
HYPEBEAST is a website used by the fashion forward Millennials (people born during the years
1980-1994), and GEN Z (people born during the years 1995-2015) [2], to get information about the latest
drops. HYPEBEAST culture generally revolves around luxury streetwear clothing, accessories, and
sneakers. Sneakers were the beginning point of this trend. Sneakers got mainly popular when Michael
Jordan sported sneakers which didn’t confine to the regulations since they were only allowed to wear
white sneakers at that point of time. This move gained a lot of attention for the sheer impact of this
change. The sneakers sported by Jordan were from Nike. Today they have their Air Jordan product line.
The recent hype regarding this culture revolves around the streetwear. Which includes everything from
jackets, t-shirts, jumpers to sneakers, backpacks, and other accessories. A very recent launch by
Supreme even included an actual brick. Though it is very controversial, it shows the extent to which the
consumers are ready to spend money for the exclusivity. The following topics include the functioning of
this market, its consumer base, and the impact it has on the economy.
II. UNDERSTANDING TERMS
A. Veblen Goods
Conspicuous consumption was a concept introduced by economist and sociologist Thorstein Veblen
in his 1899 book The Theory of the Leisure Class.It is a term used to describe the sumptuous spending
on products and services acquired mainly for purposes of displaying income or wealth. Such display
serves as a means in the minds of a prominent client to achieve or retain social status.This becomes the
basis of understanding the psychology of the HYPEBEASTs, who are involved in this market.
B. Drop
The availability of a product or service to the general public.In this scenario, releasing of pieces of a
clothing collection in small segments is called a drop. It was introduced to this industry when the
ISSN: 2005-4238 IJAS 1496
Copyright ⓒ 2019 SERSCInternational Journal of Advanced Science and Technology
Vol. 29, No.02, (2020), pp. 1496-1501
founder of Supreme, James Jebbia, opened a branch of the brand in Japan and noticed pattern used by
Japanese retail store to release their clothing and he quickly adapted to it. [3]
C. Influencer
A person with the capacity of encouraging or recommending products on social media to impact
prospective purchasers of a product or service. These are the major advertising source for the brands,
since a lot of the Millennial and GEN Z consumers follow the trends and fads promoted by them. The
better the influencer the better is the reach towards the target market.
D. Hype
A smart marketing strategy that advertises a product as the thing that everyone needs to have, to the
extent that individuals start to feel they need to eat it. Hype works with the psychology of relating to
exclusivity and its importance in today’s world. It works with the idea that the younger consumer base
wants to stand out in the crowd in any way they can.
III. HOW THE HYPEBEAST MARKET WORKS
This market mostly works on the Hype created through marketing. This culture is very much
influenced by Influencers with large follower base on social media such as Instagram, and Twitter these
including models of the likes of Kendall Jenner, Gigi Hadid, rappers like Kanye West, and Basketball
players like Michael Jordan. Once the fashion forward generation sees these influencers wearing any of
the brands, the hype gets created. This hype is generally created by making these influencers promote
products which haven’t been launched yet. This makes the consumers look for the products and hence
starting a murmur in the market. After the Hype is created, these brands announce the dates of their
drops. Once the date of the drop is announced, these consumers prepare themselves to get their hands on
some of the products.
There have been times when people have lined up outside the Supreme store from 4AM for the drop
(which generally starts from 11AM).
A similar instance was recently seen in Uniqlo in China, for a drop (Uniqlo x Kaws) where the
shoppers rushed into the store, while the shutters were being lifted. They created a big frenzy during
their pursuits of getting hands on the new collection which now sells for almost 8 times its actual sales
price. [4]
The reason these brands are so popular in today’s world is because of the fact that the quantity of the
products is very limited, giving the consumers the sense of standing out in the crowd. For example, if
Supreme is releasing 20 different designs, they will only keep around 7 pieces for each style. The fact
that not everyone can get these, makes them very exclusive and creates a high demand.
IV. CONSEQUENCES OF THIS HIGH DEMAND
Due to this high demand and limited products there is a huge resale market and an even bigger market
of duplicates.
Consumers who are unable to get the new drops, they look for places online to buy the same.
The resale market is used by the brands to keep a check on their reputation. The resale market works
entirely on the equation of demand and supply.
The higher the resale value as compared to the retail price, the better it is for the brand image. [5]
Websites like Stockx.com get a very high flow of buyers and sellers for sneakers. This website in
particular has a stock market type of data presentation. They show if some sneakers are going under
their actual price or if some are going over their actual prices.
Apps like ClubFactory are very popular for their cheap duplicates.
In a country like India, these duplicates could be found on any street side shopping area. Not only do
many sellers copy the designs they also put tags and labels on the clothes for the particular brand. A
supreme t-shirt which may be sold for $60 could be found here for as low as $1.5 to $2.
Whereas resale helps the brands to keep a check on their image, the biggest troubles faced by these
brands are to fight off the duplicates.
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Copyright ⓒ 2019 SERSCInternational Journal of Advanced Science and Technology
Vol. 29, No.02, (2020), pp. 1496-1501
V. CONSUMER BASE
According to HYPEBEAST’s Streetwear Impact Report [3], which included 40,960 responses, they
were able to conclude some of the following information.
• 80.7% of the respondents were males, while 18.4% were females, and 0.9% identified as
non-binary.
• 59% of the respondents were Asians (i.e. 30.17% Koreans, 10.72% Chinese, 5.02% Japanese,
and others). Asians in turn make the biggest portion of the streetwear market, followed by
Europeans.
• Consumers reported spending 5 times more per month on streetwear as compared to
non-streetwear.
• 70% of respondents belonged to an income bracket of ≤ $40,000.
• 62% of respondents said they were more likely to buy sneakers, ahead of tops and accessories.
• 73% of the respondents were under the age of 25.
According to the Asian respondents they choose streetwear as a Political Statement, while Western
respondents said that Community was a bigger reason for them.
• 70% consumer respondents like streetwear because it’s cool,
• Whereas 57% consider comfortable clothes to be a key factor.
• 46% place importance on exclusivity
• 27% say status symbol is the most important factor
• 24% respondents stated community (community refers to an interacting population
of like-minded individuals, affecting the identity of the given members and also their
cohesiveness. In gaining similar social perceptions gives them a sense of solidarity that may or
may not lead in the exclusion of other individuals that do not share one or more of their
like-mindedness).
According to the respondents Supreme, Nike, Off-White, Adidas, BAPE, Stussy, Palace, Carhartt
WIP, Vetements, and Balenciaga represent Streetwear to them.
Based on the Luxury Goods Worldwide Market Study Fall-Winter 2018 report by Bain & Company
[6]
, the following was observed.
• Europe was the leading sales region, followed by America, Asia, and then the rest of the world.
• Second hand market for luxury goods (including cars, hospitality, Wines and Spirits, personal
luxury goods etc.), rose to €22 billion in 2018. One of the reasons for this growth was the
systematic online reselling platforms.
• Second hand market has grown by 9% since 2015.
• Online sales were most prominent in Americas, but a faster growth was seen in Asia.
• Shoes and jewelry show the maximum growth of 7% each.
• Growth of Apparel suffered due to slow performance in the Menswear segment.
• Millennials and GEN Z were 47% of the consumers and made up around 33% of the purchasers.
VI. INDIAN MARKET SCENARIO
The exclusive sneaker drops started in India with YEEZY in August, 2015. This was the start and
now there are two types of consumer base already created. According to an interview of Jonathan
Rego, editor and founder of Nation of Sport, conducted by the website Hypebeast [9], Indian market
has two types of sneakerheads, one which actually care about the sport and the others who consider it
a fashion fad. They are also speculating that India might become a global trendsetter when it comes to
sneakers, due to the increasing disposable income and exposure to fashion fads through social media.
Resale websites, like vegnonveg.com are already up and running. There are people starting pages
on social media such as karankhatriofficial, a page which is currently being followed by 70,000+
people.
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Copyright ⓒ 2019 SERSCInternational Journal of Advanced Science and Technology
Vol. 29, No.02, (2020), pp. 1496-1501
Most of the GEN Z and Millennials are updated with the fashion trends around the globe due to the
intervention of social media.
More and more students are adopting clothing choices and haircuts from celebrities and
influencers, as seen on Instagram. People roam around shops with the images of influencers on their
phones so they can find the exact piece of clothing.
While the general population only shopped thrice a year previously, but now Indians have shifted
to shopping at least 12 times a year on average. With a population as big as India’s, 1.37 billion, even
small increases in shopping on in individual level results in an overall increased spending throughout
the country.
The Indian retail industry accounts for over 10% of the country’s GDP and about 8% of
employment opportunities [7].
The sportswear market in India has grown from ₹24,000 INR in 2014 to ₹37,000 INR in 2016.
Implying that the growth has been more than 50% in the duration of two years
Luxury market of India was expected to grow to US$ 30 billion by the end of 2018 from US$ 23.8
billion 2017 due to the involvement of growing exposure of international brands amongst Indian
youth and higher purchasing power of the upper class [8].
India's position in worldwide retail rankings has been noteworthy; the nation has strong market
potential, low financial risk, and mild political risk. India is anticipated to become the third largest
consumer economy in the world, achieving a consumption of US$ 400 billion by 2025.
Whereas talking about the rising middle class population, factors like young demographic
composition, increasing personal disposable income, more preference towards affordable luxury, are
creating brand consciousness among the population by developing preferences for specific brands.
The Indian market is also slowly climbing the Ease of doing business index as well, due to the
interventions of the government with the tax reforms (such as introduction to Goods and Services
Tax). India has reached 77.00 as of 2019[9] .
The high taxes (of 33%) on luxury goods and lack of needed infrastructure have been creating
troubles for popular retail brands. The lack of infrastructure results in popular brands looking for
shops in malls to rent. The rents are generally very high, making it a difficult choice.
Adidas has been organizing special get-together type of events ever since it brought the Air Max
Day in 2015, it even organizes YEEZY-drop after parties. Reebok started doing a similar thing from
2018. These parties have always catered to only a small, selective group of people since the consumer
base has been comparatively small.
An overall upward trend is seen in the growth of sneaker culture, resulting in a growth in high end
luxury brands as well, such as Balenciaga, and Louis Vuitton.
The fakes market has always been developing in India. People below the poverty line who can’t
invest in the actual brand, have always been attracted to the fakes.
According to Jerry Sebastian, former Marketing Manager of Adidas Originals India, sneaker culture
in India currently is based on hype, rather than knowledge [7]
VII. OBSERVATIONS REGARDING INDIAN MARKET
Indian market is being called very small and tight knit and it is speculated to remain the same for the
next 5 to 6 years [7].
According to my observations, the lack of flagship stores of these luxury personal goods brands, is
seriously hindering with the growth of Hypebeast Market in India.
The generation of tax through these stores can help the Indian Economy.
These Brands should also set up flagship stores in places like Delhi, Haryana (specifically Gurgaon),
and Bangalore since consumers from these cities also have a consumer base of the Millennials and GEN
Z with large disposable income.
India’s population by 2022 will be made up of 71% wealthy people who will be looking for
everything luxury possible. This will be the big opening for luxury goods in India [11].
VIII. DIRECT ECONOMIC IMPACT
The global footwear market was valued at $215,709m in 2016 and is expected to be worth
$278,860.7m by 2025 in terms of revenue [10].
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Copyright ⓒ 2019 SERSCInternational Journal of Advanced Science and Technology
Vol. 29, No.02, (2020), pp. 1496-1501
Sneaker resale is booming. It's now estimated to be a $2 billion market, according to Cowen & Co
estimates.
It is expected to rise three times in size over the next several years, reaching more than $6 billion by
2025.
This market is in a growth spurt due to the GEN Y and GEN Z consumer.
This ‘Hype’ creation also costs the companies a lot since they have to pay rappers, models and other
influencers to keep the hype up.
IX. FUTURE PREDICTIONS
These predictions are based on the Bain & Company report on Luxury Goods Worldwide Market
Study Fall-Winter 2018 [6]
• There is an expected growth rate of 3%-5% per year till 2025.
• By 2025 Chinese buyers will be 46% of the global market.
• Millennials and GEN Z will make up apparently 55% of the market.
• Millennials and GEN Z will contribute up to 130% towards the overall growth of the market of
luxury goods, between 2018 and 2025.
• The sales from online platforms will rise from the current 10% to 25% in 2025.
X. CONCLUSION
This culture being mainly prevalent in the Millennials and GEN Z, will result in a significant increase
till at least 2025. These trends are spreading faster in the Asian countries now as compared to the rest of
the world. Europe and America have already seen this growth.
HYPEBEAST trends have mostly been visible in the music industry, rappers like Kanye West, Jay Z
can be seen sporting clothes, sneakers, and accessories from these clothing. This culture is becoming
more visible in Asia, especially South Korea and China. K-pop artists in South Korea have been seen
wearing these styles. Celebrities have a huge impact on this market.
The Economical impart has been positive but some social issues have also been on the rise. Yellow
vest protest [12] was an example of this. These trends highlight the financial gap between citizens
creating visible tensions.
REFERENCES
[1] Hypebeast, “About Us,” [online], available at https://hypebeast.com/about
[2] Kanasa, “Boomers, Gen X, Gen Y, Gen Z Explained,” [online], available at
https://www.kasasa.com/articles/generations/gen-x-gen-y-gen-z
[3] Hypebeast, “Streetwear Impact Report,” [online], available at
http://strategyand.hypebeast.com/streetwear-report
[4] Zhuang Pinghui, 2019, “Chinese shoppers swarm Uniqlo stores for latest Kaws T-shirts and bags,”
[online], available at
https://www.scmp.com/news/china/society/article/3013080/chinese-shoppers-swarm-uniqlo-store
s-latest-kaws-t-shirts-and
[5] Hypebeast, “Streetwear Impact Report,” [online], available at
http://strategyand.hypebeast.com/streetwear-report-retail-resale-drops
[6] Claudia D’Arpizio, Federica Levato, Filippo Prete, Elisa Del Fabbro and Joëlle de Montgolfi er.,
“Luxury Goods Worldwide Market Study Fall-Winter 2018,” [online], available at
https://www.bain.com/contentassets/8df501b9f8d6442eba00040246c6b4f9/bain_digest__luxury_
goods_worldwide_market_study_fall_winter_2018.pdf
[7] Allen Claudius, “Why India Could be the Next Big Sneaker Market,” [online], available at
https://hypebeast.com/2019/8/india-sneakers-streetwear-community-nike-adidas-yeezy
[8] Indian Brand Equity Foundation, “Retail Industry in India, 2019,” [online], available at,
https://www.ibef.org/industry/retail-india.aspx
[9] 2019 TRADING ECONOMICS, “Ease of doing business in India,” [online], available at,
https://tradingeconomics.com/india/ease-of-doing-business
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Copyright ⓒ 2019 SERSCInternational Journal of Advanced Science and Technology
Vol. 29, No.02, (2020), pp. 1496-1501
[10] Transparency Market Research, “Footwear Market (Product - Athletic Footwear (Running and
Cross Training/Tennis Shoe, Soccer/football Shoe, Golf Shoe, Hiking Shoe, Baseball Shoe) and
Non-Athletic Footwear (Casual Footwear, Dress Evening Footwear, Military Boots, Lite Hiking
Outdoor Sandal; End Use - Men’s Footwear, Women’s Footwear, and Kid’s Footwear; Material -
Rubber and Plastic; Distribution Channel - Online Channel, Shoe Stores, Supermarkets and
Hypermarkets, Independent Retail Stores, Textile Retailers, Departmental Stores) - Global Industry
Analysis, Size, Share, Growth, Trends and Forecast 2017 – 2025,” [online], available at
https://www.transparencymarketresearch.com/pressrelease/footwear-market.htm
[11] Deepa Sai, “Future of Luxury Brands in India,” [online], available at,
https://medium.com/quillink/future-of-luxury-brands-in-india-6e40e7741135
[12] Pamela N. Danziger, “4 Mega-Trends Ahead For The Luxury Market In 2019: Expect Turmoil
And Slowing Sales,” [online], available at,
https://www.forbes.com/sites/pamdanziger/2018/12/18/whats-ahead-for-the-luxury-market-in-201
9-expect-turmoil-and-slowing-sales/#4d5bbdeb6578
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