Doug Howe: Yes, Dylan, this is Doug. Laura has already made, meaningful progress with the team, obviously just, as her focus is continuing to revitalize the assortment. Most notably, that’s really leaning into the areas where we’re seeing consumer demand growing and we’re underpenetrated, specifically athletic. So that’s where we’re seeing some really nice growth there. Seeing a really nice growth in the kids’ area as well. And a lot of that is on the back of the return of Nike, obviously. But we’re maintaining our commitment in own brands. The penetration was essentially flat. That’ll evolve, obviously, and the portfolio has evolved, with the acquisition of Keds, Topo, talk about Hush Puppies as well. So again, we’ll continue to evolve, but feeling really good about the green shoots, we’re seeing already, with the changes that the team has made in this format.
Dylan Carden: Thanks for that. And then final one from me, whether, presumably, it can continue to be volatile, any kind of incremental ways you can mitigate that, either between kind of being leaner on inventory, or athletic penetration?
Doug Howe: This is Doug. I mean, we’re going to continue to focus on what we can control. So, the team has done a really good job of managing inventory. We have opened a buy, to take advantage of opportunistic buys, to chase categories and products that are working as well. That’s one of our key strengths, honestly, and we’re certainly not walking away from that. So, I’d say that’s the biggest thing that – we could do. And so, we just stay really close to what’s happening, obviously, as we progress through 2024.
Dylan Carden: Great. Thanks a lot, guys.
Doug Howe: Yes. Thank you.
Operator: [Operator Instructions] Our next question comes from Dana Telsey from Telsey Group. Please go ahead with your question.
Dana Telsey: Hi, good morning, everyone. As you think about just the health and the state of the consumer, whether it’s in the U.S., or whether it is in Canada, what are you seeing that are the same, or the differences, and how has it changed exiting ’23 and into 2024 so far, whether online, or in-store? And speaking about stores, how are you thinking about your store base in 2024, whether it’s openings, or closings? And lastly, very good, very nice hire and welcoming, Andrea, to the fold. As you think about the assortment and category assortment and margin profile, what looks different a year from now than what it is today in attracting customers and gaining market share? Thank you.
Doug Howe: Great. Thanks, Dana. This is Doug. As it relates to your first question on the consumer health, as we said, we are encouraged by the trend change that we’ve seen, obviously, in Q1, as it compares to Q4. Overarching, I would say, the customer is definitely responding to newness. And that has been a dedicated focus, obviously, driven by Laura in the U.S. and then Mary Turner in Canada. So the team has been maniacally focused on that, leaning into categories that were underpenetrated, and where we’re seeing really nice demand, specifically athletic. The casual businesses, had a nice buoyancy as well. And then the kids’ businesses is coming on strong as well. We talked about the positive impact of Nike, but it’s definitely broader than that.
So, I’d say overall, it’s really around we’re seeing a trajectory change from what we saw coming out of Q4. Still early on, obviously, and still volatility. As we think about channel growth, we really think agnostically about that, between stores and digital. The digital business has been stronger, from a comp perspective than stores. But again, we’re big believers in stores. We are definitely seeing an increase, modestly in traffic there. We’re continuing to invest in top of funnel marketing, which had a really positive holdout result, to increase the traffic there. So, we’re feeling good about that. We’re leveraging stores in a different way. And we think it’s very much this ecosystem. 60% of our digital demand, is fulfilled by our stores.
90% of our e-commerce returns, are made in stores. So there’s a lot of footsteps in the confluence, of those two channels. So, we really think about those holistically. We talked about the eight net new stores in Canada. So, we’re excited about that. And we don’t have any plans to make any material differences in DSW. Again, it really goes back to the work that I mentioned that Laura’s focusing on. How do we update those stores in a very thoughtful way, with LED lighting, paint, hardwood flooring, and think about making the experience, even more inviting and enjoyable? So lots of focus on that, but no major change in the store count. And then as it relates to your last question, it’s early days with Andrea. But I’ve been really pleased, with the progress that she’s making, already with the team.
She’s maniacally focused on profitability, as well as prioritizing the brands that, we see significant upside growth. There’s been some meaningful changes, through investments in the brand portfolio in the last 12 to 15 months, obviously, with the Keds acquisition, Topo, Hush Puppies, and Le TIGRE. So again, there’s a lot of net new in the portfolio that, she has arsenal to work with. But very, very early days. We’ll come back, with more specifics, as she’s had a little bit more time in the role. Thanks for your question.
