# On Running shifted 33% of sales to DTC, protecting 59.5% gross margins while wholesale softens *The Swiss running brand is using owned stores and web to control pricing and customer experience as third-party retail slows.* By **Jenny Huang Goodman MPA MSc MHSA, Principal** โ€” The Stash Edge, Hako Shikin LLC. Published 2026-09-16. Canonical: https://www.pops4.com/stash/articles/on-holding-2026-09-16t12-6 Subject: On Holding Tags: dtc, margin, distribution, premium pricing, retail --- On Holding reported that direct-to-consumer sales now represent **33%** of total revenue, up from **29%** a year earlier, according to TradingView analysis of the company's recent earnings. The shift is deliberate: as wholesale growth decelerates across footwear, the Swiss running brand is opening more owned stores and driving traffic to its web channel, where it controls margin and message. Gross margin held at **59.5%**, a premium-tier figure that would compress under heavy wholesale discounting. The company operates **69** owned retail locations globally and continues to expand in North America and Europe, where running specialty is consolidating and department stores are cutting square footage. On's DTC channel lets it sell at full price longer, avoid channel conflict with wholesale partners, and collect first-party purchase data. The average order value online is higher than wholesale sell-through, and return rates are lower because the brand can control fit guidance and product storytelling at the point of sale. Why this works: premium physical goods cannot sustain premium pricing through distribution partners who need margin and will discount to move inventory. On's customer pays for technical design and brand signal, both of which erode when the product sits on a sale rack next to commodity runners. By moving volume to owned channels, On preserves the price integrity that justifies its **$150-$180** running shoe positioning. The DTC build also insulates the brand from retail bankruptcy and door closures, which have taken down wholesale-dependent footwear companies in the past three years. The steal for a small brand: you cannot open **69** stores, but you can refuse wholesale terms that force you below keystone. Start with a Shopify site and a local event presence, then add one showroom or pop-up in a single metro where your customer density is highest. Use that physical space to capture emails and build a list you own, not a retailer's. If a store or distributor asks for **50%** off wholesale and the right to discount further, walk. Your margin is your product development budget. Instead, offer exclusive colorways or early access to the direct customer, which creates urgency without a price cut. Run small-batch product drops on your owned channel, announce them to your email list, and let scarcity do the work. This is the same mechanism On uses at scale: control the offer, control the customer relationship, protect the margin. The broader pattern is clear across premium physical goods: brands that invested in DTC infrastructure before **2022** are now seeing that investment pay in margin protection while wholesale softens. On is not abandoning wholesale, it is using owned channels to set the pricing floor and customer expectation, then allowing select wholesale partners to sell at that established premium. The next move is to watch DTC as a leading indicator for pricing power, not just a revenue mix shift. ## The takeaway On moved **33%** of sales to owned channels, holding **59.5%** margin while wholesale slows โ€” control the price or lose the premium. --- ## Publisher **Hako Shikin LLC** โ€” Virginia Beach, Virginia. Founded 1997. ASI 217876 ยท DUNS 18-204-6339. Principal and author: **Jenny Huang Goodman MPA MSc MHSA**. - Author: https://www.huanggoodman.com/about - LLM context: https://www.pops4.com/stash/llms.txt - MCP endpoint, for AI agents: https://mcp.pops4.com/mcp - Client dashboard: https://dashboard.pops4.com/ - Catalogue: 70,000+ products, 200+ brands