Introduction

Leaking culture has been around for a long time, ever since the NikeTalk days and probably even before that. After being a part of Sneaker Twitter for a few years, leaking a few pairs myself and seeing many conflicting takes about this topic, I thought I’d write a post that sheds some light into the concept for people who might not be familiar with how information gets leaked. This post is related to how information about products gets leaked, and not about how early pairs make their way out of factories (sketchy Instagram sellers with potato cameras, etc). That is a whole different topic which we won't be talking about.

How distribution works

First of all, you have to understand how distribution works for sneakers and streetwear. Brands such as Adidas and Nike sell products at a wholesale price to retailers, who in turn mark up the products and make a profit after selling the items. Despite many people thinking the brands control everything that happens in this process, they often outsource distribution to a set of smaller third parties which have their logistics & workflows implemented in countries where brands aren’t fully present. This results in a smaller profit margins for brands when selling the items, but it also results in less expenses related to deliveries, employees and distribution centres. On the other hand, those third party distributors make a profit because they have to guarantee their operation will manage increased volumes of deliveries every season without running into bottlenecks or disappointing their business customers. While important stores in first world countries are usually working directly with the brands, smaller countries in the third world usually have to work with regional distributors to place their futures contracts and stock replenishment orders. Those are companies which you've probably never heard of who do tens of millions in revenue each year while working as a middleman between brands and retailers.

What is a futures contract?

The term futures contract (referred to as preorders or futures orders most commonly) in the footwear industry first shows up in Phil Knight’s “Shoe Dog” book. During 1973, while struggling with constant supply problems, Nike started offering its biggest customers the opportunity to make commitments regarding large, non-refundable orders delivered half a year after placing the order, in exchange for discounts as big as 7% offered to said retailers. More than 50 years later, preordering goods is the industry standard for retailers. Phil Knight’s crazy idea helped stabilize the supply chain & cashflow problems for Nike, turning the company into the billion dollar giant we now know and love. During present times, preorders can happen anywhere between 6 to 9 months before delivery & release time, which means products are samples at least one year in advance (they’re designed anywhere between 16 and 24 months in advance).

Placing orders as a retailer

For retailers working directly with brands, orders will usually be handled through internal Business To Business (B2B) platforms. For example, Adidas uses Click and Nike uses Nike.net - both internal platforms designed specifically to manage their futures programs as well as other topics retailers might find useful (such as downloading official images, managing invoices, etc). Assuming you work directly with the brands, it’s likely a simple process where the buyer logs in, adds products and quantities to cart, specifies where the goods should be delivered and places the order.

For retailers working with third party distributors, the workflow can differ based on each third party distributor. Some will have retailers place orders through Excel order sheets - while others might invest into internal platforms similar to the ones mentioned above, facilitating a better customer experience for the buyers. Throughout my time working in a sneaker store, I’ve even heard about people placing orders using pen and paper (and it wasn’t even that long ago!).

How do releases get leaked?

Here comes the fun part! While a majority of items included in those platforms (or files) are labelled as “general releases” by sneaker-heads, a really small percentage is represented by limited edition items which help create motion for the brand. Those are usually handled by special departments. For Nike, that department is the Energy department, while for Adidas it’s the Hype division. Those items are usually allocated to specific retailers, which means not everyone can order them. A small store might get an allocation as little as 5 pairs, while big-box retailers might get hundreds or thousands of pairs allocated to their account. Despite being handled by a different department, there is no difference between a regular item and a limited item - both have a style code (SKU) and a colorway, usually enough information to tell what the product will look like, especially for releases from the “Retro” niche (pairs which brands bring back every few years because of their cultural significance).

Products get leaked through many ways. Some of the popular ones are:

• Having access to the internal platforms used by retailers;
• Using affiliate marketing calendars sent to brand partners;
• Working with retail employees who have access to preorders;
• Working with brand employees (pretty rare, but it happens);

Another fun way to find information is by Google Dorking. A “Google Dork” is a specific query that can be used to filter and narrow down searches, which might uncover confidential files that brands host publicly, thinking “no one will find them”. The technique can involve filtering for specific domains or file types, usually resulting in finding PDF, CSV or Excel files full of confidential information. There is an absurd amount of confidential data hosted publicly on the world wide web, and distributors have the responsibility to make sure their system can’t be abused by curious people, responsibility which brands and suppliers often disregard and ignore thinking their systems are secure enough.

Why do releases get leaked?

There’s a variety of reasons why a limited edition release gets leaked, but more often than not it’s all down to engagement, ad revenue or social status.

• Some people might leak confidential information because it brings in engagement from community members. It can also be a good way to get organic backlinks (for SEO purposes), with major sources in the media world quoting the original poster for announcing a specific release.
• Other times, limited edition releases are leaked simply because it provides a good way to drive traffic to a media website.
• Alternatively, one might be into leaking simply because it provides clout, making people aware that they know stuff by flexing their information.
• There’s also a small percentage of people who believe brands leak information in order to test or validate concepts before beginning production.

Do brands actually leak info?

While it’s not far fetched to think brands are solely responsible for information getting out, it happens more rarely than people think. Brands have a pretty clear timeline which is years ahead of the preorders mentioned above, and usually their marketing department knows exactly how to maximize social engagement through "energy" releases (energy is a term used because those releases create energy or motion for the brand). People get excited about them and post about them on social media even if they don’t get the pair - the Nike SNKRS “Didn’t Get Them” screen is a great example in this case. More often than not, brands will “leak” their own product once the release date is coming soon by using their influencers to debut the product or by seeding early pairs to members of the community. You might also see brands debut their own product during Fashion Week or brand-related events. Collaborators should be the first people to debut a shoe, which seems to have become the new norm in order to combat leaks in recent times.

How to prevent sneaker leaks

Stopping leaks entierly is almost impossible, but brands can take steps to reduce the chances of information getting out before it's meant to. The main goal is to limit who sees sensitive release details and to make sure the systems storing that information are secure. Here's a few simple approaches brands can take to prevent leaks:

• Limit access to sensitive information. If a store isn't getting a release, there's no need for them to know about it. The less people who know about a specific release, the less chance it'll get leaked.
• Use less obvious names for limited edition releases. From using code-names to simply not marking products as "SP" (Nike uses this for Special Projects), this small change can make a big difference.
• Regularly audit the security of internal systems. Reviewing how confidential info is stored and shared can help identify potential vulnerabilities. You would be surprised by how many brands forget this!

An often-overlooked solution is to work with experienced people from the sneaker media world who actually understand the sneaker leaking process. These individuals understand where and how information gets leaked, and can help the brands spot weaknesses they're likely to otherwise miss. The best way to think like a "leaker" is to actually be one!

Conclusion

Sneaker leaks have been around for decades and they’ll continue no matter how hard brands try to suppress them. At this point, brands should probably adjust their marketing strategies to be more transparent about their upcoming releases. The golden formula of having an embargo that lasts until one week before the release is a thing of the past, and obviously no longer works. People don’t care who leaks said info, they just care about the info. Getting someone from this industry to stop leaking information won't help, as others will just take their place. Last but not least, brands have the power to prevent leaks from happening, but as long as they help generate energy for the brand and get people excited, they'll continue to happen.