"Not Just Sneakers" The MZ Generation Obsessed with Financial Investment, Could You Be One Too?

If you search for 'Resell' on Instagram, you can see numerous sneaker posts. Photo by Instagram capture

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[Asia Economy Reporter Joo-mi Lee] A financial investment craze is sweeping through people in their 20s and 30s. They are increasing their assets not only through well-known investment methods such as stocks and Bitcoin but also through new financial techniques like sneaker tech. In particular, the younger generation is actively entering the resell market, standing at the center of the resell tech culture.

Resell tech is a compound word of resell and financial technology, referring to the method of purchasing scarce 'limited edition' products and then reselling them at a higher price to make a profit. Representative examples include luxury handbags, watches, and limited edition sneakers. Neologisms such as 'Sha-tech' (Chanel + tech), 'Rolex-tech' (Rolex + tech), and 'Sneaker-tech' (sneakers + tech) are words that demonstrate the active popularity of resell tech and represent a kind of social phenomenon.

Sneaker tech, among these, is particularly accessible and popular among young people. Sneakers have a relatively lower price than luxury goods, making the entry barrier low. Also, since they are essential products used in daily life, their familiarity is cited as another reason.

Andonghyun, CEO of 'Out of Stock,' a leading domestic limited edition sneaker trading platform, mentioned in a media interview that "customers are mainly in their 20s and 30s," and "because shoes are always worn, they are an easily accessible material to generate profits, so the younger generation seems enthusiastic about financial technology through shoes."

The secondhand trading platform 'Bungaejangter' opened an offline space called 'Beugeujeuteu Lab' on the 24th. Due to the sneaker tech craze, offline stores selling limited edition sneakers are also emerging.
[Image source=Yonhap News]

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Sneaker tech works by purchasing limited edition sneakers from popular brands at the release price through first-come, first-served or lottery methods, then reselling them at a premium to earn a profit. In May last year, limited edition sneakers priced at about 130,000 KRW, sold by the sports brand Nike through a lottery, were traded at an average price of 1.9 to 2.2 million KRW.

Graduate student Ahn Jinhyung (28) resold a pair of famous brand sneakers he purchased for 119,000 KRW in January for 390,000 KRW, making a profit of about 270,000 KRW. Having started sneaker tech in October last year, he said, "It's quite profitable as pocket money," adding, "Even if the winning sneakers are not to my taste, the 'limited edition premium' attached makes the price soar, so I often enter the lottery." He continued, "I originally liked sneakers, but before, I only considered design within what I could get. However, as I gained several times the profit like this, I search for all lottery information and participate."

The craze for sneaker tech can also be seen on social networking services (SNS) popular among young people. Searching for 'resell' on Instagram, which had a particularly high usage rate among people in their 20s and 30s as of June last year, reveals various sneaker posts. One netizen posted a photo of three pairs of sneakers with the caption, "Fortunately, I won the bids at a good price, and after bringing them, the price went up. I'll keep them well and then sell them."

'Art tech' has also recently become a popular financial technology among young people. Art tech is a neologism combining art and financial technology. Unlike the resell method, where one fully owns a product and resells it for profit, art tech involves joint ownership with others. It is the concept of fractional ownership starting from small amounts in the form of pieces rather than the entire artwork. Thanks to this, investors can enjoy the experience of owning art without investing a large sum and can also earn profits when selling the artwork later.

The '2021 Hwarang Art Festival' was held from the 3rd to the 7th. This art festival attracted the highest number of visitors in its history.
[Image source=Yonhap News]

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Art tech especially attracted the attention of the 20s and 30s generation as a new investment destination during the COVID-19 era. While the offline art market shrank due to COVID-19, the online auction market was unaffected because transactions could be conducted contactlessly. Additionally, the online auction market's accessibility is relatively high because it is not restricted by time and place, which is another reason for its popularity.

Overall, as various types, artists, and price ranges of artworks became easily accessible online, the barrier for young people toward art has lowered. In fact, transactions among young people are quite active. According to the Global Art Market Report 2020 released by global financial firm UBS in March last year, 92% of young people use online platforms when purchasing artworks. The familiarity of the 20s and 30s generation with online environments combined with the activation of the online art market due to COVID-19 has led to increased interest in art tech among young people.

According to 'Black Kiwi,' a big data-based keyword analysis platform, 37.6% of those searching for 'art tech' were in their 20s and 30.5% were in their 30s, accounting for more than half. In other words, 7 out of 10 people interested in and searching for art tech are young people.

Experts analyze that this diverse financial technology craze stems from the characteristics of the younger generation, who are 'new consumers without prejudice about money and consumption, embodying capitalist logic.' Professor Eunhee Lee of Inha University's Department of Consumer Studies cited the concept of 'Capitalist Kids' proposed by consumer trend analyst Professor Nando Kim of Seoul National University, saying, "People in their 20s and 30s grew up in a mature capitalist environment. They consider pursuing wealth as legitimate."

She added, "They strive to achieve the goal of making a profit rather than owning things," explaining the active trading of young people in the resell market. She further noted, "Young people familiar with online environments are using various online information to engage in diverse financial technologies."

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