In March of 2014, on the heels of Jordan Retro GR prices jumping from $160 to $170, we undertook the analysis “Are Jordan Retail Prices Outpacing Inflation?” The answer, at the time, was no. Although retail prices were definitely increasing, Nike was not raising prices at a rate greater than inflation. The analysis showed that, in 2014 dollars, most retail prices since 1999 were within $10 of 2014 actual prices.
Since then, Jordan Brand increased retail prices from $170 to $190 for 2015, and just recently announced that 2016 retail for the Jordan 4 and Jordan 6 would be $220. In light of what feels like a pretty big jump, regardless of any “remastering”, we felt this analysis needed to be revisited.
- In the interest of more information, we’re including five models. Last year we used the AJ3, AJ5 and AJ6. We’re adding the AJ4 and AJ11.
- In the interest of simplification, we’re taking a different approach. Last year we used 2014 purchasing power as the relevant measuring stick. This time we’re asking a simple question: What would retail be if Nike had increased prices at the rate of inflation? For each shoe, starting with its first Retro, we track the actual retail price side by side with what the retail price would have been if Nike had raised prices at the rate of inflation through the years.
- In 2001, retail was $100. If you follow the blue line you will see that, had retail increased at exactly the rate of inflation, prices would have been $104 in 2003, $117 in 2007 and so on.
- Following that line, retail prices would have been only $134 in 2014, when actual retail price was $170. That’s a 27% gap.
- No Jordan 3s have released in 2015 (due to its temporary “retirement”) so we’re using 2014 retail prices. If the Jordan 3 had also jumped to $190 (like other GR Jordans this year), the inflation gap would have risen to 40% ($54).