Matthew Boss: Great color. Best of luck.
Meghan Frank: Thank you.
Operator: The next question comes from Dana Telsey with Telsey Group. Please go ahead.
Dana Telsey: Hi. Can you talk a little bit about the marketing investment and how you’re thinking about it this year as compared to last year? And then the membership program, any update on the rollout of the membership program, the profile of the guests that you’re seeing and getting? Thank you.
Calvin McDonald: Hi, Dana. From a marketing campaign perspective, as we’ve signaled, we continue to lean in to a variety of activations as a means to get at that unaided brand awareness, building on the successes that we saw last year. We continue to test and learn. We did an Align campaign beginning of last year. Very pleased with the results, followed up with a ABC campaign for him in the fall. Very pleased with that activation. We had a number of activations in Mainland China. All of those are contributing to the growth that we’ve seen in unaided awareness. So we know that we are acquiring guests and these top of funnel activations are performing. And heading into this year, we have a number that we will continue to innovate and create and bring.
So we’ve kicked off this year already with our Cityverse activation, which we were able to leverage quite a bit of earned media behind. That’s off to a strong start, as I mentioned, in particular over-indexing with our male guests. FURTHER, which another earned media opportunity supported. Interestingly with FURTHER is, we showcased up to 36 unique innovated items that will, over the next coming months, appear in our lineup for run with the first being an incredible broad innovation that we’ll be launching in Q3, the COC, or the Canadian Olympic Committee, which really we know from the Beijing Games had a great impact on the brand from a global scale. So there are a lot of exciting activations that we will continue to really geared towards that more top-of-funnel unaided awareness.
And as I shared with you, we’re seeing success on that. We have a long way to go. Early innings on what the potential of the brand is and driving unaided into that consideration. Membership program. I mentioned, we now have 17 million active members. And that’s from really the program was just one year — launched one year earlier. So, a significant number of our guests and the program is geared to drive LTV and to drive spend. And we do that through a variety of activations, as well as benefits that can be early access to product. It can be access to some of our events, leveraging our partners, be it physically in local communities, or as we did in January with Peloton having a back-to-sweat activation. And that is driving engagement and it’s having an impact on the LTV and spend metrics.
So we’re going to continue in that work, but it’s only been less than a year and a half since we launched it and very encouraged with the results so far and excited to continue building that program.
Meghan Frank: And Dana, I’ll just add in terms of marketing investment. Our marketing as a percent of sales for 2023 was 4.5% and we’re expecting to be in the range of 4.5% to 5% in 2024 and looking forward at this point in time.
Dana Telsey: Thank you.
Meghan Frank: Thanks.
Operator: The next question comes from John Kernan with Cowen. Please go ahead.
John Kernan: Thanks for taking my questions. So Calvin, we’ve seen new entrants in the space. They didn’t slow your momentum over the holiday in Q4. But can you talk to the durable competitive advantage that Lululemon maintains in terms of materials innovation scale, the depth of the offering for both men and women.
Calvin McDonald: Yes. Thanks, John. I’ll break that down into how I view it, which is really two components. One is the what’s fueling the momentum in the business and obviously, what are the unique strengths or the moat of the brand and how unique are we when we look and compare ourselves to others. So from a momentum perspective, we know that our unique approach to innovating, putting unmet needs of the guests first and delivering the solutions through science of feel beginning with fabrics, but into fit and overall into performance and then into that product, which then drives the engagement in with our community and guest relationships which then unlocks further unmet needs is really the momentum driver of this business.
And when I look at where we sit in terms of the innovation, the product and the activation with our guests and how they’re engaging in any and all activations we do, and the relationships with our stores, with our educators, NPS scores very, very positive, good momentum across all markets, when I look at those attributes. And then when I look at what makes lululemon unique, I really stack it and build it across both our model and our brand. And I think the uniqueness is all of these elements combined, other competitors’ brands may have elements of these, but when I look at our model and our product and the consistency of true innovation at the performance level, not at a fashion level, but at a performance level into our community and the way in which we activate across our partner platform and then through our stores and our ambassadors, the scale in which we’re able to do that compared to others and then combined with our D2C model where not only do we own the relationship with our guests, but there are inherent benefits of margin structure that allows us to invest other ways in our business to further differentiate.
