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Sneaker giant Nike has announced a crackdown on robot buyers who buy the most limited edition products online before anyone else has the chance.
The company says it will block suspicious orders, refuse refunds and even suspend accounts of those using automated ordering software or technology on its website.
Nike also says it may charge restocking fees to those it determines they are purchasing shoes, clothing and other items with the intent to resell them, according to the company’s updated terms of sale on its US website.
The company says it can also refuse orders that exceed the product purchase limit, which Nike sometimes places on its coveted special edition items, such as sneakers and jerseys.
Terms of sale describe the rights of both the customer and the company when it comes to transactions between the two, including purchases and refunds.
Sneaker giant Nike has announced a crackdown on robot buyers who buy the most limited edition products online before anyone else has a chance
“NIKE Stores, including any consumer rights or policies offered in NIKE Stores, are for the benefit of end-users only, and therefore the purchase of products for resale is strictly prohibited,” the Terms of Sale say.
“If NIKE determines that a purchase or order is for resale, NIKE reserves the right, in its sole discretion, and to the extent related to such purchase or order, (1) apply a NIKE policy that right or advantage intended for direct purchases by the consumer; and (2) take any action to impede any such purchase or order.”
Such measures include restricting ‘selling to consumers, consumer accounts or member accounts, canceling orders, charging for replenishment of inventory, imposing limits on purchase quantity, refusing refunds or accepting of returns, denying access to a NIKE Store and/or suspending or closing an account,” the company said.
Before the October update, Nike already banned the purchase of its products in order to resell them. The new update now outlines what actions Nike can take if it detects such activity.
Fraudulent purchases were also banned, but the new sales conditions now explicitly state the use of software and technology for the first time.
DailyMail.com has contacted Nike for comment.
The company says it will block suspicious orders, refuse refunds and even suspend accounts of those using automated ordering software or technology on its website. Pictured: A pair of Air Jordan 11 Bred, one of the most famous Nike limited edition shoes from 1995
In 2020, the sneaker resale market was estimated to be a $2 billion industry, and at the time it was predicted to triple by 2025. As a sign of how fast it is growing, it is already said to be worth $6 billion by 2022, according to the Wall Street Journal.
Several online marketplaces have sprung up to take advantage of this market such as StockX, GOAT, Grailed, and Stadium Goods, and sellers will do their best to get their hands on rare products when they are released and sell them at wildly inflated prices.
An example of this is the Nike Dunk SB Low Staple NYC Pigeon, originally released in 2009. Only 150 were made, with a retail price of $200.
By 2021, the average selling price had risen to $9,259. As of October 2022, StockX listed its last sale at around $40,000.
Pictured: A pair of Nike Hyperdunk Marty McFly sneakers. Only 350 pairs of the shoes were made, based on the shoes Michael J. Fox wore in the 1989 movie “Back to the Future II.” They can now be purchased on sneaker marketplaces for over $5,000
For years, companies have been cracking down on suspicious sales of high-demand items, such as video game consoles. For example, Walmart uses software and other resources to detect bot purchases and will sometimes cancel orders, the Wall Street Journal reported.
The popularity of using bots to buy such items has grown thanks to sneaker enthusiasts. Programmers have developed software that searches the Internet for offers of valuable products and places large quantities of orders.
The use of bots increased during the Covid-19 pandemic as people worked to buy rare consoles, computer graphics cards and toys – among other valuable items – the paper reported.
Nike’s apparent crackdown on resellers is notable because the items are highly sought after in the resale market. The brand had benefited from the attention its limited-edition products are getting from enthusiasts active on social media platforms.
However, customers also often complain that they cannot get their hands on the products for the retail price and see them later in online markets with price increases.