Blockbuster American Success Locks $3.5 Billion Mammoth Target for Roger Federer’s Brand as Rivals Nike and Adidas Set to Face the Heat

Roger Federer signed his first endorsement deal as a young and upcoming Swiss athlete with Nike. The American athletic giant roped in an unassuming 13-year-old boy who went on to create a whirlwind of records and caught the tennis world by storm. Federer and Nike were together for over 24 years. The world, including Nike, thought the Swiss Maestro would remain a Nike athlete for life, like LeBron James and Michael Jordan. But innovation and Federer go hand in hand. A year before his retirement, the Swiss legend signed a Uniqlo deal, exclusive of a retirement clause and sneakers endorsement. The wings of freedom led the Swiss veteran to explore his options and help create a new sneaker collection with On. Currently, the Swiss Maestro has two collections, ‘THE ROGER’ and ‘THE ROGER Pro,’ that cater to tennis needs and casual style.

A Swiss boy who made the US his second home is now expressing his gratitude for the country that loved him dearly as their own. The 3% stake in the Swiss athletic giant ‘On’ allowed Federer to introduce one of the most creative, comfortable, trendy sneakers to his beloved Americans. The insane demand for ‘On’ shoes among US citizens became evident when the blooming athletic brand had to take a step that put the decades-old dominance of Nike and Adidas at risk. But what did the fledgling brand lock down as its newest target?

The Roger Federer effect ‘On’ the vintage athletic giants

The former World No.1 is not just a band ambassador for On. Their union was created before On went public and Federer’s official deal was announced. After Nike let go of King Roger, Mike Nakajima, the former Nike tennis director, called the move ‘atrocious’ as no other tennis ambassador came close to Federer’s charm and ability to attract the masses. When the Swiss legend left Nike in 2018, he noticed the Swiss citizens’ adoration for ‘On.’ Since it is a relatively new brand, Federer approached the Zurich-based company with his intention of innovating a new all-round tennis shoe. They worked together till 2019, and On announced the Swiss star as its brand ambassador.

Federer worked with the creative team closely in developing a shoe that fits the tennis players the best. The 20-time major champion was never involved in any operations with Nike. But On has the expertise of a world-renowned athlete, guiding the team and providing frequent feedback, and his owning a stake in the company makes the involvement more intense and genuine. In less than a year, with Federer by its side, On reported a rise of 92% in revenue in 2022, reaching the $1 Billion mark. Meanwhile, reports stated that Nike and Adidas would reduce order volumes by 30-40% from summer 2023 to summer 2024 to prepare for the pandemic blow.

In just 13 years, On reported that 60% of its business comes from the US. There are 20+ stores selling On shoes in the US. The demand for opening new stores rose when Americans formed huge lines before the existing stores. So, Federer, who was visiting New York, had to channel his inner salesman and sell the shoes to the consumers. In a recent interview with Complex, the Swiss Maestro shared why consumers are shifting gears from the most trusted brands like Nike and Adidas to newly emerging brands like On. The 42-year-old suspects that the pandemic has changed peoples’ perspectives and running has become a significant part of life.

The Zurich giant made its mark around the same time. Federer said, “On had great running sneakers, very comfortable shoes. And once you buy an On shoe, you want another pair. You get to know the brand, and once you know the brand, I feel like it’s a very forward thinking, very new, very hip brand. ” While On has a long way to go regarding revenue, the brand has grown mainly through word-of-mouth marketing. In terms of popularity, the Swiss brand is only a few steps behind the American and German giants. But how can ‘On’ emerge as a fierce competitor to the deep-rooted athletic giants in the upcoming years?

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How is Federer-backed ‘On’ different from a Nike or an Adidas sneaker?

Nike generates more revenue globally than Adidas, but the stock price of the American company has gone down while the German’s is picking up a little pace. The American giant shells out its maximum marketing promoting portion on its brand ambassadors. Adidas focuses more on customer satisfaction and technology while frequently analyzing consumer needs. But On took a completely different approach, imbibing state-of-the-art technology and considering sensory feedback to design the shoes.

The Federer-backed company has subsequently released shoes that suit tennis surfaces like clay, grass, and hard courts. Moreover, the Swiss Maestro revealed that On is dedicated to targeting the global stage by designing sneakers according to the tastes of a particular landscape. Rising champions like Ben Shelton and former World No.1 Iga Swiatek have joined the revolutionary ‘On’ community. With Federer’s $330 million investment, the Zurich brand set a high target of $3.8 billion in sales by 2026.

The recency effect is taking over, and consumers are keen on trying out a brand with different indoor and outdoor options. The colors, subtle fashion, and sleek ergonomic design work as magnets. On is executing its marketing moves cautiously and meticulously by letting people try their shoes on the tennis court as they launch their ‘Tennis’ collection. The consumers are the face of its popularity and revenue generation. Celebrities have joined forces with On primarily after Federer’s involvement. However, the blossoming brand mainly focuses on research and has a lab setup in Zurich to regularly test and analyze performance quality.

Nike and Adidas are the invincible sneaker G.O.A.T.s, but On has the tennis G.O.A.T. by its side. Roping in young athletes like Shelton and Swiatek is a boss move, as they stay on the circuit longer and provide feedback with experience. Nike’s Air Jordan and Adidas’ Lionel Messi collections are vintage, like the namesake brands. What is your go-to sneaker brand? The time-tested labels or the newest kid on the block? Let us know in the comments.

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