Cheap sneakers take on big-name brands

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Sneaker shoppers accustomed to ever-escalating prices may be facing another kind of sticker shock this fall, with the launch of some inexpensive sneakers that make controversial claims to rival expensive shoes in quality.

Payless ShoeSource Inc. last month unveiled a running shoe called "The Amp" that sells for about $35. Payless says that the shoe performs like running shoes that cost nearly three times as much, and that it can even be used to run a marathon -- a rare claim for an under-$40 shoe.

Another company trying to challenge the dominance of $100-plus sneakers is Steve & Barry's University Sportswear, a retailer of low-price shoes and apparel that recently released a shoe under the name of NBA star Stephon Marbury that it says integrates "the same performance attributes found in sneakers sold for $100 or more." The price: $14.98, a fraction of the $125 Nike Zoom LeBron III.

Nike itself has a foot in the low-price game: Two years ago, it created a unit devoted to selling low-price footwear and apparel under the Starter brand it had acquired. The first line of sneakers, endorsed by Green Bay Packers quarterback Brett Favre, started selling in 400 Wal-Mart stores last year for under $40, though they aren't pitched as rivals to its higher-price lines.

Payless and Steve & Barry's say they can charge less in part because they forgo big spending on marketing, advertising and athlete endorsements. They also play down the importance of high-tech features such as Nike's "Air" cushioning system. The pitch is calculated to hit a nerve with sneaker buyers facing triple-digit prices and wondering if the bells and whistles are worth it.

But getting athletes to buy such arguments could be tough. The brand status of most $100-plus sneakers is grounded in the idea that they are technologically superior to anything else on the market. Competitive runners, in particular, are finicky about their shoes and often swear by the fit, cushioning and special features of more-expensive brands. Chris Demetra, a 26-year-old Nashville, Tenn.-based financial analyst who runs about 70 miles a week, says that while he might consider a $35 shoe, he would be concerned about injuring himself. Runners, he says, are "always looking for the perfect running shoe. Once they have a shoe they're comfortable with, they're not that concerned with price."

While much of the hype in the sneaker world is focused on expensive shoes, lower-price fare has been doing a steady business. According to Port Washington, N.Y.-based NPD Group, sales of sneakers under $50 made up more than half of the U.S. market in the 12 months that ended in August, with sales up 8.7 percent from two years earlier. In comparison, sales of shoes that cost more than $90 made up just 8 percent of the market, though sales have grown at a faster clip, up 24 percent.

The difference now is that some companies at the low end aspire to compete on more than price. Steve & Barry's chief partnership officer, Howard Schacter, calls fancy sneaker technology "fluff." For Mr. Marbury's "Starbury One" shoe, he says, privately held Steve & Barry's focused on a sleek design and on picking good materials for the outer sole, tongue and mesh. Meanwhile -- eliminating one big expense -- Mr. Marbury doesn't receive a salary to endorse the shoe, though he does receive some royalties. Nike and Adidas, in contrast, lavish big annual payments and royalties on icons like Michael Jordan.

A Nike spokesman notes that it offers shoes at price points starting at $20 and adds, "All shoes and all brands are not created equal, at any price point....Our products, created by the industry's best footwear designers, are based on our insights working with the world's best athletes and using our industry-leading research lab and manufacturing processes." Adidas couldn't be reached for comment.

Payless's Amp includes several types of cushioning and stability technology, such as a sturdy heel counter, which supports the back of the shoe, breathable upper mesh material and a dual density, posted midsole, which the company says offers better stability. Payless is so confident in its product that it bought advertising in Runner's World magazine and pitched the shoe to gear editors there, in hopes that it might make one of the magazine's coveted shoe-guide issues.

The reaction of Warren Greene, special-projects editor at the magazine, is lukewarm. Initially skeptical, he was pleasantly surprised by the shoe's construction when he saw it at a trade show. "I remember thinking, gosh, this is a nice shoe. It flexes in the right places; it didn't look like it would fall apart. I ran in it and it wasn't awful." But, he adds, "it's not clear if the shoe will merit a review."

Some sneaker experts contend that pricey shoes do offer benefits. Ernest Kim, a sneaker reviewer for Sole Collector magazine, says higher-price shoes from basketball and running brands tend to last longer and often feature lighter materials. And he doesn't dismiss the value of Nike Air's cushioning or the appeal of unique tricks like reflecting UV rays or sweat-wicking properties.

Even more compelling, Mr. Kim says, is the range of products that expensive brands offer, particularly in running shoes. These include shoes for those who over-pronate, or roll inward too much; those who don't pronate enough; those with a neutral gait; and even -- in one Asics Corp. shoe -- those who over-pronate very late in their step. "This kind of specialization means you can get a shoe that is almost specifically tailored to your individual needs," he says.

Still, the companies' new formula seems to be working. Steve & Barry's Mr. Schacter says that the stores' 150 locations have sold more in the first three days of the launch than the company's total footwear sales for the previous three months. Payless Chief Executive Matthew Rubel says initial sales have exceeded expectations.

The Amp is in 400 stores this fall, and Mr. Rubel says it will be sold in 1,600 branches by next year. "The biggest hurdle is to get people to be believers," says Mr. Rubel. "We're going to be very patient. Ultimately, we believe the marketplace for authentic performance footwear at the $25 to $30 range is a multibillion marketplace."

The Amp is the first in a performance-sneaker collection dubbed the Spalding Marathon Series and was created under a licensing agreement with Russell Corp.'s Spalding division. Payless is also introducing a trail-running shoe in November. For Topeka, Kansas-based Payless, the Amp is part of an overhaul at the company, which hired Mr. Rubel from dress-shoe maker Cole Haan, a division of Nike, nearly a year and a half ago.

The ultimate goal of both companies is to gain the respect of target consumers, whether they are marathoners or high-school basketball players. Mr. Marbury recently completed a multicity tour of neighborhood basketball courts and high-school basketball clinics to promote his shoe as an alternative to pricey shoes that basketball-shoe fans often can't afford. "There are kids that don't have a choice," he says. "Now people can buy a line and say 'OK, we're buying the same exact quality for $14.98 or less.'"



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