Marni Shapiro: Hey, guys. I’m curious — by the way holiday line looks beautiful, but I’m curious if we could dig in a little bit to her buying patterns and habits right now. It sounds a little bit like she’s buying what you really, really want her to have or need like uniform or holiday pajamas, but everything else, she’s maybe buying one item at a time when she needs it. How different is this from behavior you’ve seen in the past? And I’m curious if her behavior is different in the stores versus online? And if you’re seeing any difference between how she’s buying on Amazon or your outlets versus your stores? If you could just give us a little color into how the shopper is behaving with your brand?
Jane Elfers: Sure. Yes. She’s buying slightly less as we’ve covered this morning with the increase in transactions, but we have an extremely high ADS online. So we have several units in every order. So it’s not a question of her buying one unit. I think to answer your question about what’s she’s buying, we had a really strong back-to-school driven by the usual suspects, uniform denim, backpacks and those things. But that continued into September and October. September was by far, strongest month. We sold a lot of seasonal categories. We had one of our best outerwear quarters ever really across the Board. It wasn’t one thing that was selling. Obviously, to be able to deliver positive comps in e-com, we’ve got to be selling more than one category.
So it’s really broad-based across the board and clearly driven by the marketing tactics that Maegan’s been able to put in clearly driven by Maegan and her team’s ability to figure out how to scale profitable digital traffic and how to make digital acquisition our number one acquisition channel, which is very unique obviously, in this environment. So I think when you look into Q4, as we said on the call, we’re comping up positive low single digits quarter-to-date, driven again by the strength of the e-com business. And so she’s really responding, obviously, to the trend right assortments, but also again, Maegan and her team’s ability to drive strong e-commerce traffic, coupled with the fact that we discussed on several conference calls that we had an opportunity in e-com on the conversion line, based on not owning what we marketed to the depth we had wanted to last year.
We really doubled down on the styles we were marketing this year. And that is obviously working quarter-to-date and worked in the third quarter as well. From an Amazon customer profile, like how they buy on Amazon versus GCP, I would say that there would be less units per transaction, but I’m going to turn that over to Maegan, who’s the expert in that area.
Maegan Markee: Yes, certainly, from an Amazon perspective, just the makeup of a transaction is very different. She’s going there to trial brands. Things are very need-based. She needs it very quickly. So it’s a much lower UPT, much lower ADS. That’s why we think it’s, again, a very complementary partnership for us. When she comes to our website, she’s stocking up even in a tough environment. We continue to see very strong UPT and ADS from our owned and operated websites. So certainly, just a very different kind of profile in terms of how she’s transacting on those two channels.
Operator: Thank you. Our next question comes from Dana Telsey with Telsey Advisory Group. Please go ahead. And Dana, your line is live, please unmute.
Dana Telsey: Hi, can you hear me okay now? Hello?
Operator: Yes, please go ahead.
Dana Telsey: Great. As you think about — hi. As you think about 2024 having gotten through the volatile 2023, the framework of whether it’s margins, whether it’s top line, what do you see as the puts and takes? Because obviously, the digital business has very successful growth. How do you think of under the hood on the margin side, what the opportunities can look like? Thank you.
Sheamus Toal: Hi, Dana, it’s Sheamus. So I think great question. I think as we look at it, what’s extremely pleasing is to see the success of a lot of the strategic initiatives that we’re putting in place in terms of the marketing investments, really driving digital growth in an extremely competitive environment. So a lot of our peers are not seeing the same growth that we are. So I think as we move into 2024, we’re excited that we have the difficult part, which is the top line growth moving in the right direction. We’re excited with the fact that we have inventories well positioned and that should enable us to maintain the internal margin and merchandise margin that was strong in Q3 and those things, which are typically very difficult, especially in a challenging macro environment like we’re in today, are things that bode well for us in terms of 2024.
I think as we look at some of the fulfillment challenges and distribution challenges, as I said earlier, we believe that those pressures will reduce. Certainly, in the first half of 2023, we had enormous pressures from cotton, increased supply chain costs, which are now gone. And I think we’ve seen the reductions that we anticipated in those costs. We don’t have those costs built up in our inventory. So we’re moving into the first half of 2024 in a much better position than we started 2023, which — that coupled with the strong top line, the maintaining of our AURs, the strong internal margin, should bode well for a significant improvement in the first half of the year. We haven’t gotten into giving specific guidance, but certainly would expect dramatic improvement in the first half of the year.
