Swiss Sneaker Maker On CEO Martin Hoffmann

For decades, popular sneakers carried instantly identifiable brand markers–like a swoosh, or three parallel diagonal stripes. Other labels have joined the party.

One example: the head-and-shoulders-like logo and honeycomb-evoking soles on shoes from Swiss brand On Holding (ONON), which reported 2024 sales that grew nearly 30%. The company reported its latest quarterly earnings in August, turning in midyear results that exceeded investors’ expectations.

Investopedia spoke with CEO Martin Hoffmann in a pair of interviews, one shortly after the release of the data and the other in the weeks that followed. Highlights from those interviews, which covered tariffs, global markets, and more, have been edited and consolidated for brevity and clarity.

How is On navigating the tariffs landscape, given that a majority of its footwear is made and imported from Asia?

Whether we’re facing tariffs or a pandemic, it’s important to know what you stand for as a brand. We’re still growing fast as a premium brand. The combination gives us many opportunities to be able to offset the impact as a company as we bring new products at a higher level of innovation and at higher price points. 

It’s also super important for me to focus on the long term and not make any kind of short-term moves here. Our mission is to grow both top line and profitability and we will continue doing that.

We’re still growing heavily in volume, so we are getting better prices from our factories. This means we can digest some of the costs ourselves, pass on some into the supply chain.

Tariffs are nothing new for the industry, actually. Many people don’t know, but we have always been paying around 20% import duties on imported products from Southeast Asia ever since the company exists. And now that number goes up to 40%, because it’s 20 plus 20. But we have always been exposed to tariffs.

And at the same time, being that premium brand and also being a fast-growing brand, just gives you so many more opportunities to compensate for that, versus maybe being a brand that doesn’t grow that much and has less opportunities to also work on the premium side.

Are you going to try not to pass those additional costs on to consumers?

There are multiple opportunities and levers we can pull. We would never increase prices just because of tariffs. I think for us, as a premium brand, you want to maintain a certain position in the market, also versus your competitors. 

Bringing innovative products to the markets allows you to also ask for higher prices, but at the same time, we’re still growing heavily in volume, so we get better prices from our factories. We can still do a much better job in lowering our freight costs and being more efficient there.

On sneakers are priced at $140 to over $250 a pair. Will it ever become a mass-market brand?

Being born in Switzerland, it’s very clear first that you need to build a global brand because your home market is very small. And you want to build a premium brand because this is the Swiss DNA. 

There are many elements that are important for premium status. There’s innovation, investment in quality, customer experience, sustainability, and the team behind the brand. That’s the focus, and I think this doesn’t go well with being mass market. I think you would compromise on those things and we are not compromising. 

Rather, it’s the opposite, thinking about what even more premium could look like that we give to the customer. Our premium position doesn’t restrict our growth; it powers it, because it gives us that consistency with our customers. We’ll not take it to lower price points because we want to stay on that premium side. 

There are a lot of brands in our space and you want to differentiate yourself and so it’s very important to rather go into a different direction than everyone else. And so for us becoming rather more premium than more mass market, I think is clearly the direction where we go.

How important is the U.S. market for On?

The power of the brand comes from its global presence. This really started at the beginning. There are only 8 million inhabitants in Switzerland, so you can’t build a global brand if you just stay here. 

On is quite unique compared to many brands that were founded in the U.S. and could have basically stayed just in this market for the first 10 years because it was big enough. 

For us, the Swiss mindset is very global. This allows us many pillars for growth. We entered the U.S. in 2013 and China in 2018, so in the U.S. we are five years more advanced than in China. This allows us to balance and manage our growth very effectively. 

Of course, the U.S. is the largest running market in the world and the largest sportswear market. For us, it’s 60% of our revenue. But in terms of importance, we wouldn’t separate the importance of the U.S. versus the UK, Germany, or China. I think they are all super important, but they are in different life cycles and stages of growth and need slightly different tactics. 

There’s a lower share of runners in China today than there is in Japan, or versus the U.S. At the same time, it’s a very quickly growing market that comes with a growing middle class and the ability to actually spend time moving, and understanding that this is very important for your mental health and well-being. 

How is On evolving from a sneaker maker to a sportswear, and even a fashion, brand?

It’s such a luxury to be in that position, where what we stand for as a brand can be expanded into many different sports and lifestyles. 

We’re not moving into being a lifestyle brand because we are still a performance brand and every product is rooted in performance, design, and innovation. But with our premium position, we think we’re the natural choice for a customer that looks for a more premium, but is still very comfortable with a high-performing, product whose credibility was built in the sport itself—on the tennis court, winning Wimbledon—while also showing up in a fashion magazine, or winning the Boston Marathon, or is worn by both by athletes and cultural leaders like Zendaya.

Our story began with running and it’s very much the core of the brand. We took this into tennis, for example, also a sport that very much lives at that intersection of performance and design. We took it into outdoor lifestyle, we took it into training. Apparel becomes an important part of training. 

We can think about many more sports and opportunities to grow but we also need to focus and grow in a long-term, durable way. It’s about pacing it. We don’t need to do everything at the same time, but of course, the dreams are there.