This chapter analyses the sustainability-oriented transformation of clothing industries. Although sustainability pioneers introduce new products in niche markets, incumbents advance them into the mass market. Together this can lead to the transformation of industries, markets, and consumer habits. We examine the German clothing retail industry with a focus on organic cotton and related sustainable fibres. The analysis covers some of the largest German textile retailers. Data collection is based on publicly available sources. We find that in the late 1970s, Hess Natur pioneered organic cotton practices and supported the development of sustainability standards in the clothing industry. Although in the beginning this was largely a phenomenon in niche markets, some of the organic practices have now diffused amongst mainstream retailers. This is counterintuitive because previous theory suggests that incumbents only adopt practices with significantly lower sustainability standards than do niche companies. The findings can support managers to better understand their organization’s role in the transformation of industries and markets toward sustainability, and—vice versa—understand how the transformation may affect them. Leading the transformation challenge by adopting organic and other sustainable supply chain practices can be an important measure for market success.