On Holding AG (NYSE:ONON) Q3 2023 Earnings Call Transcript

Operator: And your last question comes from the line of Janine Stichter of BTIG.

Janine Stichter: Yes. I just wanted to follow up on the apparel question. It sounds like it’s working really well in DTC, especially in own retail. So as you now look to build apparel at wholesale, we just want to know more about how you’re looking to work with your partners to translate that presentation? And maybe any numbers you can put around the number of shop-in-shops you’re doing, just how you’re going to market with apparel at wholesale?

Marc Maurer: Yes. So I think it’s the exact same playbook, right? So it’s very important for building shop-in-shops, you pointed it out, that takes a bit of time. So we don’t have — we can’t have like all the wholesale partners and shop-in-shops executed in all of them within a couple of weeks. So we’re focusing very much on really bringing the full collection to life than with all the things we’ve just mentioned. And one key element I want to highlight is that we’re also building a visual merchandising team out, so that whenever you visit those stores that you experience On and our apparel collection in a premium way. And again, when we spoke about how we’re looking at spring/summer ‘24 preorder, this preorder comes with the confidence that not only the product has evolved a lot, but also our capability to execute the apparel collection at wholesale.

And we believe that kind of in the long-term, apparel will have clearly above 10% share in our own D2C. So this speaks to retail, all retail stores. We’re already showing now with some of the — with London, Miami and so on that are clearly tracking above that, but also e-com should be able to execute versus that. And if you take wholesale as a channel overall, it will probably stay below 10%, but also because we have many, many wholesale channels where apparel will not be a focus. And if you take run specialty, it’s still very much focused around footwear. So I’m giving you a bit of long answer here, but we’re excited about what we’re seeing on apparel, and we’re very, very positive that in the long run, apparel is going to be an amazing contributor to the growth of On.

Operator: Thank you. And this concludes today’s conference call. You may now disconnect.