Wendy Davidson: You bet.
Operator: Thank you. Our next question comes from the line of Alexia Howard with Bernstein. Please proceed with your question.
Alexia Howard: Good morning.
Wendy Davidson: Good morning.
Alexia Howard: Hi. Can I continue with Ken’s question about capabilities and competencies, but ask more about what’s missing. So you’ve been in the business for a few weeks now. It sounds as though marketing investment on the financial side, that’s something that needs to be stepped up. But are there any capabilities that really do need shoring up in your view, given what you’ve seen so far? And then I have a follow-up.
Wendy Davidson: It’s really too soon for me to assess our starting point around some of those capabilities. But I’ll give line of sight to sort of what I’m poking around at to explore. I’m looking at our capabilities around insights and analytics and consumer and category insights and analytics to make sure that we’re able to see what’s happening in the marketplace and where we need to be. We’re looking a lot around our innovation capabilities, but also our ability to build strong brand strategies and even things like our agency model and support model. I’m looking at what we do around communications and public relations. So how are we not just doing paid media, but where we’re getting earned media credit for our categories and brands to be a category leader, you need to know the most about the categories, you need to be delivering great strong brand news and you need to be top of mind, even with media.
So those are the things I’m looking at. On the sales side, do we have the right resources against all the channels that we should be playing in? Do we have the right customer and channel mix, are we too concentrated in particular areas, and we’ve got white space in the market where the consumer would expect to see our products and brands. So it’s looking at where those potential gaps might be.
Alexia Howard: Great. Thank you so much. And then just a quick follow-up and more specifically, I remember talking to the previous management team, and they were talking about how energy costs in Europe were a big unknown for the remainder of the year. Do you now have much more visibility into that? Are we sort of okay on that front now? And has it come through better than expected, and I’ll pass it on. Thank you.
Chris Bellairs: We do, Alexia. A great question. So we have better visibility, and we have a little bit of a feeling that it’s actually going to be a bit of a tailwind in the back half, not materially changing, but maybe shoring up some places where there were going to be risk. So in both the UK and in Germany, primarily and also in Austria, the government, as I think you know, they rolled out some CAP programs and some subsidy programs so that any of the exposure we have probably now be laid off as a result of those. So better visibility and a slight tailwind relative to what we had been seeing before.
Alexia Howard: Great. Thank you very much. I’ll pass it on.
Operator: Thank you. Our next question comes from the line of David Palmer with Evercore ISI. Please proceed with your question.
David Palmer: Thanks. Good morning. Wendy, your comment about advertising and brand building is interesting. The advertising at Hain has been pretty low for a while, a 1% to 1.5% of sales for a pretty long time. Where do you see advertising as a percent of sales going over time? And perhaps to the pushback that some people would say, and perhaps even legacy leadership that advertising is not going to be as high for some of your categories or for some of your brands at the scale that they’re at, it just doesn’t make as much sense. What would you say to that?
Wendy Davidson: Yes. Good morning. I would say that it depends on the part of marketing that you would be focused on and what’s right for the brand. So over time, we want to make sure that we are consistently investing behind awareness of the brands at a level that will allow it to break through in a category. That will differ by category, it will differ by brand, but it won’t just be advertising. Brand building holistically will be €“ are we using it to drive distribution? Are we doing shopper activation programs? Are we doing things that on digital that keeps our brands top of mind what’s the role of e-commerce, not just traditional e-commerce, but even our own channels that use €“ we can use as brand-building vehicles to keep our brands top of mind with the consumer.
So I would look at it as the 360 of marketing rather than just traditional advertising. Our categories and brands and even the consumers were appealing to aren’t necessarily going to be in mass media.
David Palmer: So do you think your advertising, is there a certain percentage of sales that you might get to? And then maybe more specifically, are there categories where you think you’re being outspent on a category basis for nearing competitors at your size categories that would be more likely to get that spending? Thanks.
Wendy Davidson: Yes. I would say it’s early for me to say where I think I want our long-term investment around brand building to be and it would also be really soon for me to say where is our spend versus the competitors we should truly benchmark ourselves against. But that’s exactly what we’re looking at. How do we ensure that we have optimum share of voice and that we are investing in a way that can provide continuous support behind the brands, not just we wouldn’t want to come out big and then be able to €“ and then have to be in a position to starve the brands later in the year or later in the second year. So figuring out what that right shape looks like for each brand and category will be a key part of our next phase of focus.
David Palmer: Okay. Thank you.
Wendy Davidson: You bet.
Operator: Thank you. Our next question comes from the line of Brian Holland with Cowen and Company. Please proceed with your question.
