The November sale of streetwear icon Supreme to apparel and footwear giant VF Corporation for north of $2 billion raised the question of what exactly was the retail conglomerate getting for its money? To the uninitiated, Supreme’s business model seemed to be based on little more than slapping its familiar red and white “box logo” on T-shirts and sweatshirts produced in limited numbers to create a perception of exclusivity. Could a logo really be worth that much?
The value of intangibleassets like logos has been a topic of conjecture for more than a century. In 1912, the most valuable trademark in the world was said to be that of Royal Baking Powder: The company considered its name to be worth “$1,600,000 a letter,” for a total of $715 million in today’s dollars. Coca-Cola’s name, in contrast, was seen to be worth only $5 million at the time, an inflation-adjusted $132 million today.
Obviously, it’s quite difficult to attach a dollar figure to names and logos. In the days when a company’s worth was measured mainly in terms of the factories and file cabinets it owned, any excess value beyond that of those physical assets was lumped into a murky category called “goodwill.” The importance of goodwill has long been recognized and is still practiced in accounting today. As legal scholar Edward S. Rogers noted in 1910, “The good will of a business is often of greater value than all the tangible property, and a trade mark is nothing but good will symbolized.”
Supreme is an entity of pure goodwill, and it’s easy to place the box logo at its epicenter. As a recent Christie’s auction catalog put it, “Equally at home on both the sidewalk and the catwalk, the Box Logo is the pumping heart of the brand, and is now more highly coveted than ever before.” The wordmark, set in white Futura type against a red background in a style appropriated directly from artist Barbara Kruger, is the focal point of many of the company’s products (or “pieces,” if you will).
True, not everything Supreme sells features its iconic box logo — its collaboration with graffiti legend Futura, for example, included a logotype that, amusingly, did not use the Futura font — but often these items carry an air of unfamiliarity that may be off-putting to the more mainstream customer that VF is after. It’s akin to how the classic rock band will tend to drive its fans to the restrooms when taking a mid-concert break from playing its more popular hits to introduce a song from its new album.
The box logo serves a secondary function as a sort of modern-day Good Housekeeping Seal of Approval, allowing Supreme to confer its imprimatur of coolness on its lucky collab partners — like Hanes, Lacoste, and even the likes of Brooks Brothers — by placing it adjacent to their less hipster marks.
Of course, as branding professionals must surely get tired of yelling, brands are more than just logos. Supreme’s brand, owing to its roots in the early 1990s New York City skateboarding scene, is often touted as being about “authenticity.” But a few decades and a couple billion dollars later, thanks to private equity backing, who are we really kidding with this? Donning Supreme no more marks you as a cool downtown skater than wearing Air Jordans makes you like Mike.
The true essence of the Supreme brand is irony. Start with the name itself: fitting today, perhaps, but at the time of the company’s founding, certainly tongue in cheek. The word “supreme” peaked in usage in 1898, one year before VF, the parent company of The North Face, Vans, Timberland, and now Supreme, was established as the Reading Glove and Mitten Manufacturing Company — and imparted an ironic old-timeyness to the upstart streetwear brand.
Early on, Supreme, like many streetwear purveyors, specialized in “logo flips,” playful remixes of established brand imagery that parodied the very notions of branding and fashion, and this practice has continued with recent absurdly hilarious collabs such as Supreme x Oreo and Supreme x Ziploc, as well as the unforgettable Supreme Brick (literally just a brick). Of course, the overarching irony of Supreme has been its use of Kruger’s anti-consumerist art to sell lots of stuff. And Supreme’s success has brought it an additional layer of irony: While in 2000 the brand was being sued by Louis Vuitton for ripping off its monogram print, by 2017 the two companies were partnering on a well-received fashion collection. Like Johnny Rotten hawking butter, many old rebels eventually find themselves back in the good graces of the establishment.
It’s not always clear who is in on Supreme’s joke. Are the hypebeasts, the enthusiasts of the brand who stand in line for hours to cop some pickups from the latest Supreme drop (as the kids say), earnest or ironic in their fandom? Supreme has gamified their consumerism, making the most shameless use of artificial scarcity this side of the Disney Vault to send them on a Pokémon-style “gotta catch ’em all” hunt for endless limited editions, logo variants, and alternate colorways. One intrepid shopper did manage to obtain all 253 versions of the iconic Supreme box logo T-shirt; Christie’s was expected to sell the collection last month for $2 million, or eight grand per shirt.
And what does VF make of Supreme’s irreverence? After all, multibillion-dollar purchases are rarely made ironically. The $33 billion conglomerate, a longtime major player in the underwear, outlet mall, and police uniform spaces, has more recently established a lifestyle brand empire and would presumably know what it is doing with Supreme. VF’s challenge with its new acquisition can be summed up in a quip from baseball legend Yogi Berra about a once-hip restaurant: “Nobody goes there anymore — it’s too crowded.” Can VF sell Supreme — a brand rooted in underground exclusivity and elusive product drops — to a mass market?
If it can, then what will become of Supreme’s brand, its goodwill? After all, there are consequences to selling out. Harland Sanders, a truly authentic entrepreneur driven by his passion to create not only the world’s best fried chicken but also its finest gravy, sold Kentucky Fried Chicken to a group of investors for $2 million in 1964, then watched as his life’s work was bastardized in the name of efficiency.
“They prostituted every goddamn thing I had,” he complained. “I had the greatest gravy in the world, and those sons of bitches — they dragged it out and extended it and watered it down that I’m so goddamn mad!” Colonel Sanders spent his final years toiling as a brand ambassador for KFC, and four decades after his death, the company still exploits his image in its commercials as an ignoble caricature portrayed by the likes of Jim Gaffigan and Mario Lopez.
It’s unlikely that any such indignity awaits Supreme and its British founder, James Jebbia. Perhaps the worst that could happen would be that a Supreme factory store might pop up next to a Hot Topic in a VF outlet mall, or simply that many more uncool people might be wearing Supreme.
It remains to be seen whether the box logo and the rest of Supreme’s goodwill are worth the billions they were purchased for. But VF should take note that goodwill can be fleeting. KFC might still be kicking, watered-down gravy and all, but when was the last time you bought any Royal Baking Powder?