Streetwear brands, like all retailers, want to make money but they’re careful not to turn off their customer base, which doesn’t like to appear mainstream. To maintain an aura of exclusivity the ultra-hip brand, Supreme, uses social media hype and shrewd supply and demand tactics to create artificial scarcity, fueling sales.

CGTN America’s Karina Huber has more.

It’s 11 am on a Thursday. Dozens of people are lined up outside the Supreme clothing store in New York. They’re waiting for a so-called “drop”—or new release. This time it’s a collaboration with North Face.

“It’s the hype, you know. It’s what young people do,” said one fan waiting in line.

These young people, mainly men, are called “hypebeasts.” They thrive on collectible clothes and sneakers, which they keep for themselves or sell for inflated prices in the secondary market. Some items are marked up by 1,000 percent, or more.

“I know people who – like this is their job – is to resale. They don’t do anything else but resell clothes,” said another fan.

Supreme emerged in 1994 out of a skate shop in New York. It quickly developed a cult-like following. Today it has eleven stores around the world and is valued at a billion dollars. Half of it is owned by private-equity giant Carlyle Group.

Despite its Wall Street affiliation, Supreme has maintained its underground appeal thanks in part to an unorthodox business model.

“Supreme has mastered the art of scarcity or the marketing of scarcity. They have a lot of different goods, but they release them in limited buckets so even the exact same product with different colors can feel scarce within the color that is being offered in that moment,” said Alix Barasch, Assistant Professor of Marketing at NYU Stern.

Customers are only allowed to buy one of each item. New items drop once a week – Thursdays at 11 am – at all their stores around the world. All of this creates a frenzy among fans. Barasch says social media has helped fuel the hype.

“The photographic aspect of their brand. The fact that it is photogenic. That it conveys status and luxury and all of these things that are important for consumers anyway, this has just been amplified in the social media era,” said Barasch.

Even moms like Shirley Rollins are now willing to wait in the cold for a chance to buy a piece of Supreme.

“Well, my son collects this stuff, wears it and is teaching my younger son about it so it’s a lot of fun. So I figured, you know what, for Christmas, it’s a good deed,” said Rollins.

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David Schoonmaker discusses the limited release strategy for fashion retail

CGTN’s Rachelle Akuffo spoke to David Schoonmaker, co-founding Partner at D+G Lathian about the streetwear brand Supreme, and the influence of its ‘drop’ strategy in the fashion industry.