After making its New York Stock Exchange debut today, On is ready to take its business to the next level.
Co-CEO Marc Maurer spoke with FN this morning, shortly after news broke of the pricing of its initial public offering. The Swiss footwear company stated 31.1 million Class A ordinary shares were issued and priced at $24 per share.
Maurer revealed On’s most immediate priorities, which include bolstering its presence in markets that are critical to longterm success, expanding its brick-and-mortar presence in key cities and making strides in sustainable innovation.
Below, Maurer discusses the company’s next steps.
What excited On the most about going public?
Marc Maurer: “The biggest excitement was definitely because it would allow us to continue to build the company on even a larger scale, using the immediate attention that we’re getting and also being able to to raise funds so we can grow our own store footprint, we can invest significantly in China, in the field of sustainable materials as well. These were the main drivers. And we are a very private company coming out of a small village in Switzerland, and we’ve invested a lot and we’ll continue to invest in keeping the culture, because it’s very important to us. On is a partnership, and not just the partnership between the five partners, but between the bigger team as well. So the cultural piece, we’re going to continue to invest a lot of time and make sure we can keep the place what it is.”
What, if anything, made On apprehensive about going public?
MM: “Honestly, I slept pretty well last night. I think there was more of an appreciation of becoming a public company and the challenge to deal with this in a positive way. We weren’t particularly nervous about this one specific day, but we appreciate this challenge and we are very ready to be a public company.”
What are your intentions as you raise capital? Where are you going to use the money?
MM: “One field is definitely innovation, and one example is sustainability. We’ve got the Cyclon, the first fully recyclable shoe that comes in a subscription model, that’s one example. The second area is we want to continue to build experiences for our customers, be it with our own stores and also with shop-in-shop experiences with our retail partners. And then geographic expansion. We feel we have a big opportunity in Asia, in China specifically. This will really help us to bring the brand to even more consumers.”
Geographically speaking, where is your presence the strongest? And where is your presence lacking?
MM: “We are present in over 60 countries, and we’re quite confident with the presence that we have now around Central and South America. We have teams in the key markets, we have our operations set up, and now it’s about scaling them. One big focus will be around the U.S., which is currently 49% of our revenues — and we expect it to grow. The second big focus will be on Europe. We have huge differences, for example, between Switzerland, where we are the market leader together with Nike, and Italy or France, where we are still basically just getting started. We see quite the opportunity in some European markets — France, Italy, U.K., Spain, just to mention a few. We went to Asia very early with Japan, and we’ve seen great successes in Japan. To be able to replicate that in other Asian markets, especially China, is going to be very important to us. It’s also worth mentioning that we’re a multichannel brand, so we will continue to focus on building an amazing experience through our own direct-to-consumer engine, which is especially important in China, where you basically have an absence of the traditional wholesale channel. We will also focus on continuing to grow with our wholesale partners.”
How will you specifically bolster your efforts with the Cyclon shoe and your sustainability-focused subscription service?
MM: “We want to continue to invest in sustainability and hopefully circular materials, and ultimately our dream is to become a fully circular company. We will take many steps to go into that direction, and one big element is definitely the material side. Our industry is very much fossil fuel-based and we need to move away from that. Cyclon is our first take on a subscription model, which needs quite a bit of investment in the supply chain. Being able to scale that is another area where we’ll continue to invest.”
What are your goals for retail stores and shop-in-shop experiences?
MM: “In all the major cities around the world, we plan to have a place where you can experience On in a unique way. New York on Lafayette [Street], where our first store is, is the first example, and we’re going to bring that to more cities. London is on the radar and Tokyo is on the radar. And we work with some of the best retailers on the globe, and we’re going to continue to build the brand in a three dimensional way with them. For example, with Nordstrom, we’re planning on rolling out a large shop-in-shop footprint that will allow the consumer to experience On even more uniquely.”
When do you expect to be in these key cities?
MM: “London, Berlin, L.A. and Miami are on the radar to happen within the next 12 to 18 months. And then we’re going to roll out to additional cities.”
Do you plan to enter new partnerships with retail giants — or expand the ones you have now?
MM: “We’re mainly planning on expanding on the existing partnerships, and we are very happy with the partners that we have and how we were able to build a premium brand in the industry. But we might selectively do new partnerships. For example, we started working with Foot Locker and did a first trial there. The Foot Locker trial has already started and we’re already in Shoe Palace. It’s a continued process where both sides constantly evaluate what’s the right way to move forward and bring On to even more consumers.”
How do you keep the momentum going?
MM: “We will continue to bring great product to the market. For example, the Cloudmonster is launching this spring, and the Cloudrunner — which has been received very well — is launching this spring, and we’re launching a new version of the Cloud this spring. This will drive a big part of the momentum.”
How has the COVID shutdown of Vietnam impacted On? How does the brand think the situation will play out?
MM: “We are most concerned about the health of our team, of all the workers in the factory, so we’re very close with the factory and doing everything we can to keep everyone safe. As we’re making progress with vaccinations, for example, we are now looking at slowly reopening and we expect factories to be able to reopen within the next one to three weeks based on the signs we’re seeing from the government and the provinces. We basically expect to have a production interruption for six to eight weeks, and we don’t expect this to be a long-term topic.”