Redefining the run: How bold innovation is transforming athletic footwear

In a category long dominated by Global players and established niche brands,  it seemed the door was surely closed to new entrants. So how did On go from zero to $2.5 billion in a little over a decade?

Breaking the mould in performance footwear

Swiss-based On Holding AG has rapidly emerged as a challenger to industry giants Nike and Adidas by rethinking how running shoes are designed, marketed, and sold. Despite its unconventional approach, eschewing aggressive marketing spend and relying on a grassroots, athlete-led adoption strategy, the brand has carved out a significant presence in the global running and lifestyle footwear market.

A clear market opportunity

Nike and Adidas created a vacuum by prioritising fashion over performance and shifting away from speciality running stores to a direct-to-consumer model. On seized this moment, positioning itself as a premium, high-performance alternative just as running culture surged and consumers sought new, comfortable options for both athletics and daily wear.

Innovating from the ground up

On's distinctive CloudTec sole, initially mocked for resembling "squishy tubes", became its defining innovation. Developed by triathlete Olivier Bernhard, who created early prototypes with garden hose segments, this technology delivered a unique combination of cushioning and responsiveness. When major brands, including Nike and Adidas, passed on the concept, On was launched and its founders turned it into a proprietary advantage.

Challenging the status quo with a different growth strategy

Rather than raising vast amounts of capital early on, On prioritised organic growth through strategic retail partnerships, professional endorsements, and selective marketing investments. Key moves included:

• Retail Strategy: Leaning into speciality running stores and influencers rather than mass-market distribution.

• Brand Equity Control: Deliberately pulling its products from over 200 retailers in smaller European markets when the brand was being seen as too orthopaedic rather than performance-driven.

• Selective Celebrity Endorsements: While Nike relies on athletic dominance, On blended performance credibility with cultural relevance, securing Roger Federer as an investor and brand ambassador while later signing Zendaya and FKA Twigs to appeal to younger, style-conscious consumers.

• Entrepreneurial Structure: Rather than appointing a CEO, On was initially run by its five Partners, an approach that, future investor Ken Fox credited as, providing a far deeper pool of executive brainpower.

  
  

From niche player to global force

By 2024, On had achieved $2.5 billion in sales with 30% YoY growth, an impressive trajectory, even though it still represents just 2% of the global athletic footwear market compared to Adidas' $25 billion and Nike's $50 billion. Its impact is undeniable:

• Disrupting Retail Channels: Specialty retailers like Foot Locker and Dick’s Sporting Goods credit On and Hoka with driving new customer traffic, directly benefiting from Nike’s withdrawal and D2C focus.

• Winning Market Share in Performance Running: On has become a serious competitor to Brooks and Hoka, with its new high-performance models gaining traction among dedicated runners.

• Expanding into Lifestyle and Apparel: While its early apparel attempts struggled, On has revamped its clothing line and launched high-end collaborations, signalling broader ambitions.

  
  

The path forward: Scaling while staying authentic

On's biggest challenge now is sustaining growth while maintaining its credibility as a performance-first brand. With plans to expand its China business, enter new sports categories, and develop cutting-edge trainer technology (e.g., the fully automated LightSpray production process), it remains on an aggressive trajectory.

The key question is whether On can continue to balance innovation, brand exclusivity, and mainstream appeal without falling into the same pitfalls that diluted Nike and Adidas' focus. As co-CEO Marc Maurer puts it, “If that leads to us being bigger than Adidas or Nike, that’s beautiful.”

For now, On is proving that industry incumbents can be challenged, not by following their playbook, but by embracing Planarian Behaviours and rewriting the rules entirely.

Planaria are a species that constantly find a way of regenerating themselves to survive and thrive. Our proprietary toolkit brings planarian behaviours to business, helping keep clients ahead of the signals to drive continual regeneration and continuous growth. Making the moves before the market moves around them.