Planet Money Summer School 2: Competition and the cheaper sneaker
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Jul 19, 2023 
Dan Wong, a strategy professor at Columbia Business School, dives into the world of competitive markets. He discusses the fascinating rise and fall of the Starbury sneakers, an attempt to offer an affordable alternative to the iconic Air Jordan. The conversation highlights the critical balance of differentiation and price in marketing. Additionally, Wong shares insights from the rivalry of bell manufacturers, illustrating how brand loyalty can be shaped even in a crowded marketplace. This exploration reveals valuable lessons for entrepreneurs in making their mark.
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The Starbury Story
- Stephon Marbury, frustrated with expensive sneakers, partnered with Steve and Barry's to create the affordable Starbury shoe.
- Despite selling millions of pairs, the Starbury brand ultimately failed due to the 2008 financial crisis and Steve and Barry's bankruptcy.
Stuck in the Middle
- Starbury's strategy suffered from trying to be everything to everyone, offering brand recognition yet aiming for affordability.
- This "stuck in the middle" approach left it vulnerable to competitors specializing in either high-status or low-cost products.
Avoid the Middle Ground
- Avoid creating a product that tries to be everything to everyone.
- Specialize in either quality or cost differentiation to avoid losing to more focused competitors.