Matthew Boss: Great. And thanks for all the helpful color. So, two-part question. Gina, I guess first, what do you attribute to the softening in September and October? And then maybe if you take that, could you just elaborate on what you’re assuming from both a macro and category level in this bridge from the front half of next year to the back? And then Eva, as we think about the balance between the continued tech investments and the cost savings, what is the fixed cost leverage point in the business, or what sales growth do you need to leverage SG&A going forward?
Gina Boswell: Great, thank you. So, thanks, Matt. Great to hear from you. I think as I mentioned in September and October – well, really we were quite encouraged actually in August starting pretty strong with nearly flat. But then in September, we saw the traffic for the first time swing negative, and then bouncing back a bit in October. We did lap the loyalty launch, but really we also saw just pressure overall on the customer, and certainly consistent pressure on the basket size as well. So, what we are seeing is that the customer is, for sure, under pressure. We saw the categories continue to normalize as well. But really most of what we’re talking about for our outlook for Q4 is based on the fact that we saw softer although positive traffic in the September, October months. So, that’s what we have seen, and that’s what we have built into our guidance going forward. And your second part question, I’ll hand to Eva.
Eva Boratto: Sure, Matt. On the SG&A leverage, I would think about it as we need 3% to 5% growth to get that leverage going.
Gina Boswell: And I think you had another part of your question embedded that had to do with sort of as we turn the corner, and obviously, we have a very big quarter in front of us. So, we’re looking forward to talking to you more about that as we get into 2024.
Matthew Boss: Great. Best of luck.
Heather Hollander: Thanks, Matt. Next question.
Operator: Thank you. Our next question is from Gabby Carbone with Deutsche Bank. Please proceed with your question.
Gabby Carbone: Good morning, and thank you for all the color today. I was wondering if you can dig a little further into adjacency categories such as men’s haircare and laundry. Are these categories driving in new customers, or do you view them being more as additive to the basket? And then just on the laundry side, maybe how you kind of view the addressable market there. Thank you.
Gina Boswell: Thank you. Great question. Thank you, Gabby. On men’s, we spoke about the fact that it’s still low awareness, and while it’s been growing double-digit, we’re leaning in to fuel that growth. So, there’s a marketing campaign we’re undertaking right now that is meant to address the awareness piece. And so, we’ve got an experiential tour out there. We’re taking our men’s shop on the road. The influencer campaign, we’re inviting athletes and so forth to reach new audiences and fans. So, we’re quite excited about the men’s opportunity. It is still a small percentage of our business today. And so, that’s the kind of – obviously, in part incremental from a customer point of view. That’s on the men’s side, a very big addressable market, to your point, $12 billion.
So, penetrating there is very helpful as we reshape the portfolio specifically into the next year. The launch of hair has also outperformed. I mean, we have gotten a great response to our fragrance-led positioning there. In the second quarter, we launched it in 560 stores, but we’re going to complete the North American rollout in the spring of 2024. And while we are particularly excited because this attracts a new customer to Bath & Body Works, considering that 14% of our fragrant hair care customers are new to our brand, so while it’s too early to comment on the possible size of the business, I can tell you that we’re confident in our positioning, with the fragrance leadership as our point of differentiation in the category. And finally, I think as it relates to your comment on laundry, laundry, again, a very large addressable market at $14 billion.
And so, we’re excited about the potential there. We knew that our customers wanted to experience their favorite fragrances in multiple forms, and certainly that is a differentiated factor for Bath & Body Works. And the customers have asked us for those laundry products. You may recall that we used our loyalty program to sort of canvas their ideas about what signature sense they wanted for us to offer. And in the third quarter, we did have the limited launch of laundry, the feedback very, very positive, because laundry detergent is an exciting new way to add another layer of favorite scents to the daily routine, and that includes the fragrance boosters as well. So, we’re testing and optimizing the product as we do to prepare for expansion next spring.
Julie Rosen: Gina, I would just add, you mentioned it, but just to sort of reiterate, the great thing about the new categories is they definitely bring new customers and they help to build the basket. So, we’re very excited about rolling these out over the next year.
Gina Boswell: Thank you, Julie.
Gabby Carbone: Great. Thank you so much.
