It will come as no surprise that in 2019, 1.92 billion people will have purchased something online. Many consumers are used to the experience at Amazon and Walmart, where stock is virtually unlimited and prices are low. They rarely have to think about not getting the product that we want for the lowest possible price. There’s one industry, however, which seems to struggle on that front: the limited-edition sneaker market.
The sneaker resale conundrum
The sneaker market has become white-hot in recent years, thanks to the rise of musicians and athletes moving into the fashion world and creating huge demand for their very limited products. Long gone are the days where Michael Jordan was the only major athlete with a shoe deal. Now, many artists, such as Kanye West with his Yeezy brand of shoes through Adidas, are massive successes. One might assume that the internet has helped to develop an environment whereby consumers can get any shoes they want, in any size, shipped right to their door for a great price.
The reality is markedly different, particularly for the most sought-after sneakers. If a consumer tries to buy the latest shoes from Michael Jordan or Kayne West, it can often be challenging to find them from an online retailer. As soon as they are available, they sell out. Even if they are online at the precise time a sneaker is released, it might go to backorder status.
How is this possible? Buying (and selling) high-demand shoes online can feel like a game that one cannot win because you're playing against a team from an entirely different league.
What is a sneaker bot?
Sneaker fans anticipate the latest releases of their favorite shoes like music fans do for concert tickets or tech fans do for the latest iPhone. This release frenzy has seen the emergence of a secondary market dedicated to making sure consumers only have one option to get the desired product: Pay higher than the suggested retail price on resale websites.
This is the work of a sneaker bot, a set of tools that automates all parts of the sneaker-buying process. For a few hundred dollars per month, a sneaker bot is available to automatically purchase the latest shoes from an online retailer before the average user has a chance to click “Add to Cart.” Once the person behind the sneaker bot gets the shoe, they will resell it on a third-party website for significantly higher than they just paid.
There is no technical expertise needed to use a sneaker bot, and the resell value is enough that users of these services can comfortably fund their luxurious lifestyles with the revenue. Sneaker bots work in the background while their masters simply sit back and watch their high-value products roll in. The companies that offer such bots are professional organizations with 24-hour customer service, online help resources and all the trappings of a modern online enterprise.
The impact of sneaker bots on e-tailers
While retailers want to sell the most popular shoes, they’d prefer to sell them to regular consumers, not bots. It’s not a positive brand experience if the shoes are sold out immediately on a retailer’s website, and then pop up on a secondary site for double the price.
If you aren’t familiar with the shoe consignment market, a quick Google search will show you how large an industry it has become. To make matters even more frustrating, what these sneaker bots are doing isn’t illegal. The BOTS Act of 2016 does not cover the online shoe market.
The solution to protecting your online store
Now that we’ve laid out the problem at hand, you might be wondering: what can be done?
Security providers now have a variety of tools at their disposal that are effective at battling sneaker bots. Most solutions involve the monitoring of basic environmental information of website users, such as IP addresses and service provider information, and the volume of traffic coming from these sources in order to detect sophisticated sneaker bots that mimic human behavior.
Recognizing the behavioral patterns of these bots based on a collection of data points including the different ways they interact with the website, along with environmental data, traffic volume and device fingerprints, is what enables effective sneaker bot mitigation. If the e-commerce industry embraces these types of solutions, frustrated shoppers losing out to sneaker bots will be a thing of the past, and e-tailers will be able to prioritize real consumers who become living, breathing evangelists for their brands.
Kim DeCarlis is CMO at PerrimeterX, a growing Series C company that provides modern web application security solutions that safeguard digital businesses from malicious activities.