One of James’ early insights was that people like dressing high-low, i.e., pairing Supreme products with apparel from high-end brands like Louis Vuitton.

• Armed with this insight, Supreme has collaborated with many iconic brands over the years, such as Nike, Louis Vuitton, and Comme des Garcons. These collaborations help expose Supreme to new audiences. In return, brands get access to the streetwear subculture.
• Whenever celebrities and trendsetters — A$AP Rocky, Tyler the Creator, and Kanye West — are seen wearing Supreme, the demand for more Supreme products spikes.

You’ll not find Supreme’s goods on Amazon or in another store. Like clockwork, every Thursday at 11:00 am during the spring and fall season, Supreme drops a limited collection of merchandise on its website.

• This fixed time and location reinforce the habit. Customers know when to expect new merchandise.
• Hence, they keep coming back to the Supreme website every week. It also creates excitement, rumors, and conversations within the community.

Unlike most brands, Supreme isn’t in the business of profit maximization, i.e., selling as much product as possible.

• Their weekly collection drops have many products but in minimal quantities. Additionally, once sold, Supreme never repeats the same product.
• This scarcity intensifies the desire because customers know that it won’t be available again if they do not buy the product right now.
• Generally, demand far outstrips the supply. Hence, Hypebeasts compete to buy the products, and the merchandise is sold within minutes, if not seconds.

What happens if you wanted something, but it got sold out? You know that Supreme won’t release more of the same product. This is where the resale market kicks in, converting Supreme’s merchandise into collectibles.

• Despite knowing they could charge more, Supreme has consistently kept its original retail prices low to spawn a secondary resale market.
• Often called “Supreme Flipper” or “Supreme Collectors,” resellers earn a significant markup on the original retail price. You can find the Supreme products for resale on websites like StockX. 
• The resale market expands Supreme’s target market beyond Hypebeasts to include those who want to earn money by flipping merchandise.

Random JPEGs become valuable and thus NFT-worthy when people emotionally associate with them. Often the emotional connection is a result of solid storytelling.

However, there are only so many stories that your brand can tell. Therefore, it becomes critical to collaborate with other celebrities and brands to expand the story and reach.

Ritvvij Parrikh

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NFTs are closer to luxury brands (Lamborghini) than fast-moving consumer goods (Shampoo). Luxury brands like Burberry, Nike, and Louis Vuitton spend millions on destroying their own unsold merchandise to preserve their reputation of exclusivity.

Ritvvij Parrikh

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Every time a person buys an NFT from you, they buy into a long-term volatile asset. So it becomes your responsibility to nurture a community that will last the test of time.

Hence, you cannot jack up the prices even if demand outstrips supply. Instead, you’ll have to leave value on the table so that a mature resale market develops and resellers can earn a healthy profit.

In return, you lock in customers and resellers into a community that is committed to you long-term.

Pre-NFT: A non-NFT example of a company that has maximized for community instead of profit is WordPress. Over the last 18 years, many blogging platforms have come and gone but WordPress has endured. This is because of the community of developers, agencies, designers, and dependent companies that it has nurtured. In 2011, WordPress powered 13.1% of the Internet. By 2019, that number had grown to 32.7% of the Internet.