From the establishment of the brand to becoming famous and ubiquitous, this time chain has been continuously compressed.
The Swiss sports brand On, which was listed on the New York Stock Exchange on September 15, is a typical case. On the day of listing, On's closing price was US$35.4, an increase of 45.83% from the issue price of US$24, far exceeding expectations.
On's latest market value has reached US$10 billion, five times its valuation of US$2 billion in the last round of financing before listing.
, a professional sports brand, was established in Zurich, Switzerland in 2010. It focuses on "innovative running experience" and is sold in more than 60 countries and regions around the world. Over the past 10 years, On's net sales have grown at a compound annual growth rate of 85%.
On’s rise can be seen as a business example for sports brands from single-point innovation to global breakthrough.
In the early days, this young brand chose minimalist SKUs and a highly stylized brand story. When consumers were tired of the repetitive dazzling advertisements, On established a unique brand identity by emphasizing innovation and professionalism. At the same time, the intensive pace of globalization and the combination of DTC and retail franchising have provided sufficient convenience and availability for the core customer groups.
We can observe how the new generation of consumers are influenced and attracted, and get a glimpse of the evolution trend of the consumer industry in the future.
Innovative technology changes the running experience
In the words of Bianca Pestalozzi, general manager of Onpa Asia Pacific, "the timing of our entry into the market is very clever."
More than ten years ago, most running shoes were designed to be very thick in order to provide a sense of support, and were coated with various decorations. It was difficult to achieve cushioning and racing at the same time, and they were not suitable for use in scenes other than the training ground.
But market demand has undergone fundamental changes.
On the one hand, there is a wave of sports and leisure in the world. This generation is blurring the boundaries between work, family, sports and entertainment. “People are looking for a piece that can be worn from the gym to the conference room and back again. Products of the training ground."
On the other hand, running has gradually become a global sport in the past 10 years. The social basis of running has become wider and wider, and marathon events have become a kind of "social currency" for the middle class.
After the epidemic, the running craze became more obvious. "When people began to realize how important physical health is, and most gyms and indoor sports centers were closed to the public due to the epidemic, running became the first choice.
Many urban residents, especially those living in big cities in China, are no longer satisfied with Their surroundings are starting to move away from the city to the surrounding mountain roads or further afield,” Bianca said.
Under this trend, people’s demand for functional running shoes is becoming more and more sophisticated. Runners of different levels need professional-grade products that match their training intensity and environment, and On’s professionalism hits the right mark. to improve the running experience.
As a brand with "athlete genes", On hopes to help runners achieve better performance through innovative technology.
Former triathlon champion (hereinafter referred to as "triathlon"), On's co-founder and executive board member Olivier Bernhard (Olivier Bernhard) has mentioned many times that he wore On for the first time. The feeling of running shoes - "It's like a certain switch in the body has been turned on."
This is due to On running's application of CloudTec® technology in the soles. This patented technology launched in 2010 can provide better stability when the foot lands. Cushioning and converting it into explosive power for kicking forward, while achieving light touchdown and powerful rebound.
Every two or three years, On will release new patented technologies and propose new solutions to existing difficulties.
For example, the Seiko non-slip sole Missiongrip™ launched in 2017 is mainly used in cross-country shoes, which can effectively absorb the impact caused by downhill and help runners go downhill steadily on steep gravel roads;
The Helion™ Superfoam launched in 2019 The midsole cushioning material combines stable and strong foam elements with softer and elastic modules, which can maintain softness, hardness and high performance in different extreme temperature environments. Behind
is a diverse team from 52 countries, including scientific researchers, athletes, designers, storytellers, product R&D designers, digital innovators, talent scouts and business operators. They focus their research and development on three aspects: high-performance original technology, high-quality design and recyclable sports equipment.
’s solid investment in scientific research has allowed them to gain many “fans” from athletes.
At the recent Tokyo Olympics, female triathlete Nicola Spirig wore On Cloudboom Echo running shoes to participate in the competition;
Tennis player Roger Federer (Roger Federer) became On An investor and partner of Onpa, On has also sponsored a number of triathletes, including Tim Don, who broke the world record in 2017, and London Olympic runner-up Javier Gomez. )etc.
In the process of providing support to athletes, the feedback and needs of athletes in turn provide impetus for product updates, allowing the team to make timely adjustments and upgrades.
On Another feature of Angpai products is the integration of powerful performance with Swiss precision. Most of On's shoes adopt a simple, high-end style, with a large number of low-saturation neutral colors used on the uppers, with rich matching possibilities;
But at the same time, they are also exploring how to combine running shoes with streetwear. Style connection, for example, this year’s latest launch of Cloudnova Z5 is equipped with a skeleton support structure for racing functions and a fluorescent yellow upper that is more trendy.
Now, On's shoes have covered three major series: road running, outdoor and sports life, enough to meet the composite needs of entry-level enthusiasts to professional athletes, from daily exercise, outdoor cross-country to competitive competition..
“Our core advantage is the product itself.” Bianca said in an exclusive interview with Huxiu.
data shows that many consumers will buy more than two pairs of shoes and recommend them to friends and family; 43% of online consumers make repeat purchases; in user surveys, On’s customer net promoter score (Net Promoter Score, a popular customer loyalty analysis metric, reached 66.
Let "sustainability" attract consumers
Among the consumer brands that have emerged in recent years, there are a large number of value-driven cases, and On is one of them.
"Sustainable development" is the core value emphasized by On. Currently, On uses FSC-certified 100% recyclable cardboard to make shoe boxes and 100% recyclable HDPE plastic to make clothing packaging. It is moving towards using 100% recyclable polyester and 100% recyclable products by 2024. The goal of recycling polyamide and 100% organically certified natural materials continues to advance.
" Our younger generation of customers are becoming more and more knowledgeable and discerning. They not only pay attention to the performance of products, but also care about the entire earth's ecology. will pay more attention to the brand's efforts in this part." Bianca said.
After the epidemic, whether a brand pays attention to "sustainability" has become an important factor affecting purchases.
McKinsey found in a survey that the epidemic has had a positive impact on people’s environmental awareness, and consumer behavior has also changed accordingly.
More than 60% of the respondents said they try their best to recycle and buy products with environmentally friendly packaging, 67% of consumers regard the sustainability of materials as an important shopping reference factor, and 63% of consumers take measures against the brand itself. Environmental protection measures are recognized as a publicity method.
On is also looking for ways to combine "sustainable" concepts, innovation and business.
Last year, On launched the first fully recyclable high-performance running shoe, Cyclon. It is made of bio-based materials with more than 50% castor seeds ingredients, and produces carbon dioxide emissions higher than other styles. The average emission is 50% less, and the waste generated is 90% less;
At the same time, for the Cyclon shoe, On has launched a subscription model product service. After users purchase running equipment, they will use it to reach the end of its service life. If you return the running shoes to the brand, you can exchange them for new products.
Behind this is the transformation and upgrading of the entire production and sales model.
"We have not only created a new product, but also created a new supply chain." Yin Jiahui, On's global head of R&D and supply chain, said to Huxiu, "In order to complete the entire product life cycle, we It is necessary to design a reverse recycling of products, how to recycle and clean products in an environmentally friendly way, how to break down products into raw material particles, and how to give raw materials a new life cycle again.”
The media called Cyclon “the shoes you can never own.” ", but for young consumers, "owning" is an insignificant thing. Subscription consumption not only ensures that you can always wear the latest technology shoes, but also fully expresses environmental protection claims.
From the perspective of brand communication, On uses products and value propositions to replace the past "high-altitude bombing" marketing model.
Consumers no longer chase traditional brands, but instead look for brands with clear missions and in line with personal values. This has set off a strong hurricane of consumer brand replacement around the world. On’s relatively restrained marketing strategy shows that The brand quality has obvious appeal to young people who are looking for fresh experiences and want to show their individuality.
The channel for conveying this value is no longer indirect through TV advertisements and spokespersons, but directly face-to-face with consumers, allowing them to participate, try on and experience. "No matter where consumers are, we can meet their needs." Bianca said, "Through various local activities, we have established close ties with the community."
Global expansion and the Chinese market
The local market capacity is too small. There are not enough runners to support the long-term development of a running brand. Therefore, On has become a global enterprise from the beginning.
Now, On has 8,100 retail terminals around the world, and the distribution model that combines DTC and retail franchise has become a key factor in its rapid global layout.
Currently, On has successfully landed in more than 60 countries and regions around the world, including Europe, Asia, Australia and Latin America. North America is On's largest market at present, accounting for 49% of total sales; followed by Europe, accounting for 44%; China is On's fastest growing region. How can
maintain the innovative quality of the brand itself while adapting to the consumer preferences and culture of various regional markets on the road to globalization?
Across the world, On has highly emphasized the brand imprint of "technology and nature". For example, in the Shenzhen Vientiane World store that officially opened on September 15, On placed a "boulder" in a prominent position - its prototype is a stone in the Engadine Valley in the Swiss Alps. It is made of bio-based raw materials and China limited colors are restored by 3D printing.
In addition, this store is also equipped with an OnScan running data analysis device. Consumers can scientifically analyze the gait type of runners by scanning foot patterns, running on-site and comparing it with a large number of running gaits in the database. , thus recommending suitable shoes.
Since the consumption preferences of each regional market are so different, the local strategies adopted by On are also different.
For example, when entering the Japanese market with a long tradition of running, On quickly "infiltrated" the local triathlete athletes and running community, established close ties with core members to influence more target customer groups; at the same time, it created a A multi-channel sales network with Japanese characteristics. Now, On ranks third in Japan’s high-end running shoe market.
In the Chinese market, On regularly holds OMC marathon training camps, urban morning and night runs, and exploration of urban classic architectural routes in various cities. It will also set up drinking water supply devices in stores and provide them in conjunction with store community activities. Running shoe fitting service. Through diversified sports forms and based on the digital touch points of the online flagship store, On can connect more consumers .
“Chinese consumers value brands more than product categories when shopping,” Bianca said.
“Therefore, we will focus on how to make consumers understand the brand faster and increase the proportion of DTC, such as creating a sense of design and technology through brand direct stores, online flagship stores and channels such as Beijing SKP brand counters. By coexisting with the store atmosphere and introducing local activities, aims to achieve lasting brand promotion effects by creating a real user experience, rather than just setting up a shopping location. "
Online is another important position.
"Last year, our sales in Tmall and Jingdong achieved triple-digit growth. There is also huge potential in second-tier cities that do not have physical stores for the time being. Through multi-channel sales, we have seen online sales in China and strong complementarity with offline channels. After three years of expansion in the Chinese market, we are still committed to acquiring new customers and expanding our fan base," Bianca said.
In June this year, On held an online running challenge on Tmall to introduce users’ local running routes, thereby promoting repurchase by some users.
At present, On has opened a number of directly-operated stores in China. Opening more self-operated stores and opening more offline stores through dealers will be the focus of development in the next few years.
As part of the localization strategy, On is also considering building a product supply chain in China in the medium and long term. Bianca mentioned that in the United States and Japan, there is a huge market for running shoes that provide support and cushioning properties. China’s running culture has not long emerged, and some runners have begun to try marathons within a year or two. Many runners hope that running shoes have more powerful competitiveness. speed function.
" China has a very good sports product supply chain foundation. Implementing a localized supply chain in China can respond to the Chinese market demand faster and better." Yin Jiahui said.
Data from Euromonitor International shows that the Asia-Pacific region currently accounts for 28.7% of the global sportswear market, and On's sales in the Asia-Pacific region accounted for 5 in the whole year of 2020 and the first half of 2021 respectively. % and 6%, which means that On still has huge growth potential in the Asia-Pacific region, especially the Chinese market.
As On has accelerated its deployment in the Chinese market, the sales curve has become steeper.
In 2020, On's total sales increased by 59% year-on-year, of which sales in the Chinese market almost tripled. In the first half of this year, On's sales increased by 85% year-on-year. With Swiss precision and "Chinese speed", On's growth path is still accelerating.
