On: How Brand Discipline
Became a Competitive Advantage
Became a Competitive Advantage
While Nike has been struggling to regain momentum, Swiss sportswear brand On has been growing rapidly. Its annual sales increased from CHF 725 million in 2021 to just over CHF 3 billion in 2025.
But On's success isn't just about innovative running shoes. It's also an interesting example of how consistent brand management can create a competitive advantage.
On was founded in Switzerland in 2010 with a focus on innovation and performance. Its distinctive CloudTec cushioning technology helped the brand stand out in a crowded market and establish a premium positioning.
However, the company took a different approach to growth than many established sportswear brands.
But On's success isn't just about innovative running shoes. It's also an interesting example of how consistent brand management can create a competitive advantage.
On was founded in Switzerland in 2010 with a focus on innovation and performance. Its distinctive CloudTec cushioning technology helped the brand stand out in a crowded market and establish a premium positioning.
However, the company took a different approach to growth than many established sportswear brands.
1. Protecting premium positioning
Rather than chasing sales volume at any cost, On focuses on selective distribution, pricing discipline and carefully managing its retail partnerships.
The logic is simple: excessive inventory leads to discounts, and frequent discounts gradually weaken a brand's perceived value.
On wants customers to buy its products because they see value in them, not because they expect another promotion.
According to On's management, the brand's average footwear price has risen from $145 to $170 over the past five years. The company also claims to have the highest average selling price and lowest discount rate in wholesale markets such as the US. Its gross margin reached 62.8% in 2025 and 65.4% in the second quarter of 2026.
Rather than chasing sales volume at any cost, On focuses on selective distribution, pricing discipline and carefully managing its retail partnerships.
The logic is simple: excessive inventory leads to discounts, and frequent discounts gradually weaken a brand's perceived value.
On wants customers to buy its products because they see value in them, not because they expect another promotion.
According to On's management, the brand's average footwear price has risen from $145 to $170 over the past five years. The company also claims to have the highest average selling price and lowest discount rate in wholesale markets such as the US. Its gross margin reached 62.8% in 2025 and 65.4% in the second quarter of 2026.
2. Turning competitors' mistakes into opportunities
In 2020, Nike accelerated its direct-to-consumer strategy, reducing its presence with some wholesale partners and focusing more heavily on its own digital channels.
The initial results were encouraging, particularly during the pandemic. But as consumers returned to physical stores, Nike's reduced retail presence created opportunities for competitors, including On.
On took advantage of this shift while maintaining a balance between selected retail partners and its own channels. In 2025, its wholesale sales grew by 27.5% and direct-to-consumer sales by 33.7%.
The lesson is important: distribution isn't just about sales. It also shapes brand visibility, accessibility and consumer perception.
In 2020, Nike accelerated its direct-to-consumer strategy, reducing its presence with some wholesale partners and focusing more heavily on its own digital channels.
The initial results were encouraging, particularly during the pandemic. But as consumers returned to physical stores, Nike's reduced retail presence created opportunities for competitors, including On.
On took advantage of this shift while maintaining a balance between selected retail partners and its own channels. In 2025, its wholesale sales grew by 27.5% and direct-to-consumer sales by 33.7%.
The lesson is important: distribution isn't just about sales. It also shapes brand visibility, accessibility and consumer perception.
3. Making innovation part of the brand identity
From CloudTec to LightSpray, On has continued investing in product innovation.
More importantly, these innovations are visible and easy for consumers to recognise.
Its distinctive sole design makes the product identifiable, while technologies such as LightSpray reinforce the brand's reputation for engineering and performance.
Innovation becomes more than a product benefit. It becomes part of the brand story.
From CloudTec to LightSpray, On has continued investing in product innovation.
More importantly, these innovations are visible and easy for consumers to recognise.
Its distinctive sole design makes the product identifiable, while technologies such as LightSpray reinforce the brand's reputation for engineering and performance.
Innovation becomes more than a product benefit. It becomes part of the brand story.
4. Building awareness without losing positioning
On has also invested in partnerships that extend its appeal beyond running.
Roger Federer brought credibility in tennis and became involved in product development. Collaborations with LOEWE and Zendaya connected the brand with fashion and lifestyle audiences. Most recently, On entered football with Kylian Mbappé, who is helping develop the brand's first football boots, planned for 2027. Thierry Henry joined as Director of Football.
Each partnership helps On reach new audiences while reinforcing its positioning around performance, design and innovation.
The results are significant. According to the company, global brand awareness has grown from around 12% in 2023 to above 30% in 2026, and On is now targeting more than 50%.
On has also invested in partnerships that extend its appeal beyond running.
Roger Federer brought credibility in tennis and became involved in product development. Collaborations with LOEWE and Zendaya connected the brand with fashion and lifestyle audiences. Most recently, On entered football with Kylian Mbappé, who is helping develop the brand's first football boots, planned for 2027. Thierry Henry joined as Director of Football.
Each partnership helps On reach new audiences while reinforcing its positioning around performance, design and innovation.
The results are significant. According to the company, global brand awareness has grown from around 12% in 2023 to above 30% in 2026, and On is now targeting more than 50%.
What's next?
On aims to reach at least CHF 5.6 billion in annual sales by 2029. The challenge will be maintaining its premium positioning as it expands into new categories and reaches a much broader audience.
From a brand management perspective, On offers a valuable lesson.
Strong brands aren't built through communication alone. They are built through consistent decisions about products, pricing, distribution, partnerships and customer experience.
On's growth shows how these elements can work together to create brand value.
The real test will be whether the company can maintain that discipline as it becomes a global sportswear giant.
On aims to reach at least CHF 5.6 billion in annual sales by 2029. The challenge will be maintaining its premium positioning as it expands into new categories and reaches a much broader audience.
From a brand management perspective, On offers a valuable lesson.
Strong brands aren't built through communication alone. They are built through consistent decisions about products, pricing, distribution, partnerships and customer experience.
On's growth shows how these elements can work together to create brand value.
The real test will be whether the company can maintain that discipline as it becomes a global sportswear giant.