Mark Mahaney: Okay. Thank you, Sumit.
Sumit Singh: Sure.
Operator: Thank you, Mr. Mahaney. Our next question is from Brian Fitzgerald with Wells Fargo. Please proceed.
Brian Fitzgerald: Thanks guys. A couple of follow-ups. The cross-category form of penetration 20%, where do you think that can get to at maturity and is that accelerating? And then follow-up on NSPAC hitting $530, can you opine a little bit on what’s going on with household spend and how much of that you think you can eventually capture as you continue to add different products and different SKUs and services?
Sumit Singh: Sure. Hi, Brian. On the cross-category for Rx, in one of our top priorities inside the company is one where we believe every active Chewy customer should also be a Chewy Pharmacy customer. So there is a lot of headroom here for us and we are excited about that. And yes, on a year-over-year basis, it is accelerating or has accelerated and so all positive here. NSPAC, household spend can recaptured. We believe we are – for our loyal customers, we’re likely capturing a majority of their spend in the food and health segment today. Supplements was an opportunity for us two years ago, but we closed that gap pretty credibly last year, which has actually also contributed to the NSPAC expansion for us. So on these merge classes that constitute food, toppers, health, whether it’s diet or prescription medication or OTC, or supplement, we believe we are actively consolidating and gaining share.
And that truly is kind of where the consumers’ mindset is today. Because if you recall, what’s happened is consumer allocated $100 towards pets. In the past, it used to be $80 on consumables and health, $20 on hard goods. That $20 hard goods thanks shifted out of there, and most of that is now being spent on consumables and health, and it will remain so up until the macro recovers in our opinion. Long-term, we’re actually – the fact that the spend continues to move from offline to online, I believe, we will emerge as a stronger company in the future, given both our base, the level of investments that we’ve made through the pandemic and the execution quality that the team continues to demonstrate. Overall, we’re much – we’re bullish about the future.
We all collectively have endured just a short-term macro as it played through.
Brian Fitzgerald: Thank you so much, appreciate it.
Operator: Thank you, Mr. Fitzgerald. Our next question is from Lauren Schenk with Morgan Stanley. You may proceed.
Nathan Feather: Hi, everyone. It’s Nathan Feather on for Lauren. Perhaps you could dig in a little bit more on the industry that we hop road-map. What gets you from the encouraging 20% cross-category penetration today to the goal of 100%? And from the pharmacy side, how much of that SKU expansion versus getting more customers to discover and adopt it? Thank you.
Sumit Singh: Yes, so it’s primarily – it’s a great question. Primarily – our primary challenge is the discoverability of this platform and essentially winning customer trust. If you noticed, or if you recall, I may have mentioned this data point, a third of the customers today in the United States don’t visit their pets at a recurring frequency or don’t consume medication at the recurring frequency. And so we have an opportunity to not only expand the current TAM that we see in this particular space, we also have the opportunity by driving – essentially by driving incremental compliance and that has truly been the power of how we go-to-market with customers on the back of our Autoship platform. So our Autoship eligibility for pharmacy is at par or even higher than our consumables businesses and we are rapidly innovating to make sure that customer sign – any kind of friction around customer experience, whether it’s sign-up or whether it’s discovery or whether it’s sort of checkout is being addressed actively by the team.
Overall, our NPS on this platform continues to remain high and we’re pretty proud to serve a large base of customers. So this is less about adding SKUs, it’s much more about just making sure that there is awareness as well as discoverability.
