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On: Capitalising on the Perennial Sportswear Boom

Sportswear brands can lean into innovation, technology and collaborations to build credibility with outdoor-focused consumers, explains On’s co-founder for The State of Fashion 2024.
Co-founder of Swiss sportswear brand On, David Allemann, sits down in an interview for The State of Fashion 2024.
David Allemann, co-founder of Swiss sportswear brand On, sits down in an interview for The State of Fashion 2024. (David Allemann; On)
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The way David Allemann sees it, On’s expansion from geeky, high-tech running footwear into fashion-forward sportswear is evolution, not revolution. Having co-founded the company in 2010 to make quirky-looking running shoes for top athletes and avid amateur runners — whose prototype made from cut-up garden hoses is still proudly on display at On’s Zurich headquarters — Allemann has seen how a performance brand like On can “naturally transition” into the wider world of fashion, while staying true to its sporting credentials. The key, he says, is credibility with consumers.

In the case of On, that “organic” ability had multiple implications — from distance running came trail running and professional track and field, then to the pivotal moment in the company’s history when On entered into a partnership with tennis star-turned-investor Roger Federer in 2019, capturing the attention of not only gym-goers and hobbyist runners, but enabling it to continue expanding its global footprint and product mix, to generate a record net sales of 1.22 billion Swiss francs ($1.36 billion) in 2022, with apparel’s contribution to the top line steadily rising year on year.

With many consumers continuing to embrace performance wear as their everyday “uniform,” Allemann says there are plenty of growth opportunities for performance-sport brands.

BoF: The sportswear category has become increasingly competitive, with newer entrants. But even as the market gets more crowded and 2023 has been challenging generally, On continues to grow. How does the brand stay ahead and consistently build desirability?

David Allemann: Generally, the performance-sports space is a super interesting one where there is so much opportunity because we’ve just seen that massive channel shift of consumers, pretty much almost making performance and sports their new uniform. Driven by the fact that consumers now probably, on many days, are working from home and have it much easier to integrate sports and potentially even nature if it’s close by. ... In a sense, the market has become much bigger and we feel it’s because of the new uniform. I think this benefits every [brand] that comes from a true performance and sports core.

In the case of On, we’ve been working very hard over the last 13 years — it’s still a young brand — to build at the intersection of innovation, but also design and sustainability, because we feel if you get that formula right … I think you [can] be relevant for the consumer in this market.

BoF: How is the global consumer shift towards embracing the outdoors and healthy lifestyles impacting the sportswear category?

DA: Today it’s probably almost easier to come from sports into fashion than it is to go from fashion into sports, because so much [inspiration] is driven from performance technology and from performance silhouettes. Of course, you can create a sneaker coming from fashion, but it’s just much less credible. Also, if you think about membrane jackets, technical hoodies, track pants or even backpacks, these are now so big in fashion. But ultimately these are all silhouettes that are originally coming from the sports category to make sportswear the new uniform. If we look at fashion brands these days they almost feed on sports technology, whether it’s stretchable fabrics or closure systems.

BoF: Presumably, the barriers to entry to becoming a performance footwear brand are high, right?

DA: To start in footwear, you have to have high credibility when it comes to the technology and what uniqueness you bring to the market. That absolutely is not a given. I think we had this gem of technology that for the first time was not just a new foam, but was really an engineering piece that we brought to the market, and then having all the speciality retailers [selling our shoes] and seeing the benefits [of the technology], and also getting the whole buy-in of athletes in the Boston Marathon, like Hellen Obiri or the On Athletics Club that we built together with our athletes.

BoF: On brings athletes into the core of its product development process. Since 2019, you’ve had a fruitful relationship with Roger and with the athletes in the On Athletics Club. Since then, there have been many examples of other performance brands working with athletes collaboratively. How important will this way of working with athletes be for the On brand going forward?

DA: For us, it’s always personal. When we’re building partnerships, it’s always a personal journey, and we really feel that the brand and the personality have to fit. We just feel so fortunate to have Roger, Iga [Świątek, winner of 2023′s French Open] and Ben [Shelton, winner of 2023′s Laver Cup in Vancouver, Canada] on board.

Going back to the very origin of On. … When we started developing On, we always went to our — back-then — lab in a carpenter workshop and tested the shoes or the new outsoles out, together with our athlete friends. So it’s always been the case for On that innovation and athlete testing are intrinsically connected.

It just happens now on a much bigger scale. So we’re building that scale and I feel the On Athletics Club has given us an opportunity to build almost a family of athletes, who sometimes live together, train together and are part of that On Athletics Club, but are of course also our daily testing ground of every innovation step we take.

Iga is so involved in the development of her shoe that we keep iterating to make it even better, and so it’s actually quite a long process how we work together to get the best out of it. It’s at the very core of On, and it’s also not something where we’re basically saying, ‘Let’s bring in an athlete, let’s get some ideas,’ and then we do something together and we move to the next athlete. It’s long-term relationships.

BoF: How has On’s approach to launching its apparel category been evolving?

DA: It’s fantastic to have Tim [Coppens] on board [as our apparel designer since 2022]. Tim has, I think, this unique background, being originally a snowboarder and a skater, starting out with sports brands, then crossing over to fashion, then having his own fashion brand. We feel this duality in DNA that is part of our success formula. Together with Tim, we have continued to build the apparel business for On.

It is hitting exactly at that intersection where it’s with the most technical fabrics with ultralight membranes that win ISPO awards — very technical, but at the same time also accessible and versatile so that you can make it part of your uniform, whether you’re road running, whether you’re out on the trails, or whether you’re travelling. So our apparel addressed a range of activities across a very active lifestyle.

You’ve also probably observed how we’ve been opening our retail experiences around the world. There’s Regent Street [flagship store in London], but already more than 10 stores in China, as well as US stores including New York, LA and so on. Just to see how apparel is embraced in our retail experience again, gives us the feel that we’re hitting the right spot. So, for example, in some of our stores in China, apparel is already 20 percent of the sales.

BoF: As a performance brand in the sportswear category in China, what is the On strategy for penetrating that market?

DA: We started in China quite a while ago and it’s a fully Chinese team that sits in Shanghai. We’ve pretty much started the relationship with the China market as we started in a lot of the markets, where it’s really about grassroots and making sure that you’re doing fun runs, that we are connecting to the training community, which is very important in China as well, and that we’re also physically present, which is what we realised as in other big, big markets. You have to build that nucleus in different cities but you can’t go after the full market. So, in a similar sense, we started in the major hubs in the US and in London then [a pop-up store] in Liverpool in the UK. We started with Shanghai and Beijing and are expanding from there.

Building that community first is really important for us because the community is also what carries you. For us, it’s very much about our mission to ignite human spirit through movement. To have that movement, you have to have a community around you. That is at the core.

BoF: Have you found any interesting differences between, say, the Chinese market and other markets?

DA: Yes. What we realised is that for example the speciality stores — the grassroots [speciality] retail partners that helped us grow across the rest of the world — exist less in China and so we realised that we have to, to a certain extent, build that on our own. That’s also why we have almost as many stores, or probably as many stores, opened in China alone as we have in the rest of the world. These [On] stores or retail experiences become a hub for building our community. Then a lot, of course, crosses over into the digital sphere. But [in China] you have to build that grassroots community yourself.

This interview has been edited and condensed.

This article first appeared in The State of Fashion 2024, an in-depth report on the global fashion industry, co-published by BoF and McKinsey & Company.

Further Reading

The eighth annual State of Fashion report by The Business of Fashion and McKinsey & Company reveals an industry navigating deep uncertainty. Download the full report to understand the 10 themes that will define the industry and the opportunities for growth in the year ahead.

About the author
Daniel-Yaw  Miller
Daniel-Yaw Miller

Daniel-Yaw Miller is Senior Editorial Associate at The Business of Fashion. He is based in London and covers menswear, streetwear and sport.

© 2024 The Business of Fashion. All rights reserved. For more information read our Terms & Conditions

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