Tarang Amin: Sure. So for context, Olivia, historically at CVS, we were in a three foot gondola end cap. It allowed for very little amount of high end assortment in those sets. CVS is moving to six and ten foot sets in line as they expand space. So, it gives us a lot more room to get more of our assortment and certainly all of our holy grails, many of our new items, each of our core items. Similarly, Walmart, while they’re at eight feet, they have significantly more capacity to take more of our innovation, more skincare and many of other items. So, we feel really good about what that’s going to enable similar to what we saw with both Target and Ulta as they expanded assortment. Those are probably pretty good guides in terms of the space and what we’re able to pick up.
Olivia Tong: Got it. And then, how should we be thinking about volume versus price mix in the next 12 months. Obviously, you’ve seen very strong benefit from volume and price mix, but more from volume. And that obviously now creates tougher comps. The price mix is starting to or the mix is picking up with Naturium, sort of super driving that. So, just kind of curious how you think about the contribution from those two pieces. And then just if I could sneak one other one in, it’s just around advertising, spending from here. Now that you’re at 24% of sales, just thanks for confirming that you’re planning a Super Bowl ad again this year. As you think about sort of getting the best ROI as you continue to increase your spend. We also saw that Nick is planning a Super Bowl ad as well.
So, competition is clearly trying to kind of catch up to you and run your playbook as well. So, can you talk about some of the actions you’re taking to just continue to stay ahead of your peers and keep that ROI, as high as you have? Thanks so much.
Mandy Fields: Hi, Olivia. I’ll take the question on volume versus price mix. Again, we’re very pleased that the majority of our growth has been driven by volume. I think that speaks to the health of the brand, I think that speaks to the engagement that we have with our community, and something that we certainly expect to see on the road ahead. To what level price mix plays into it, we’ll have to see, as we go through. But we feel pretty confident that volume will continue to lead our growth as we go forward.
Tarang Amin: And then on your question on advertising, we feel great about the 24% that we’re guiding this year and that’s really based on the tremendous ROIs we’re seeing on our marketing investment in terms of gross sales per dollar invested. I’ve been in the consumer space for over 30 years. It’s the first brand I’ve seen where you take up your marketing levels and actually get better ROIs. So, we feel really good about what we continue to see from a marketing ROI standpoint even as we take our levels up. And then in terms of competition, and competition catching up. I think what you’ll see is us continue to innovate, continue to be leaders and trailblazers on different platforms. We talked this time in terms of taking the strength we have in Gen Z, we have been picking up by opening up that aperture more millennials, more Gen X.
You heard about our efforts this last quarter with the Latinx community where we already are overdeveloped, with the partnership we did with Manuel Turizo in terms of the engagement that that created. Even with Gen Alpha, you see us, our branded experience on Roblox was the number one branded experience on Roblox, 96% rating. I think over, 5 million plays so far. So, I think, competition can try to try to catch up, but we feel really great about our unique ability to entertain and engage our community, and you’re going to continue to see that, including staying tuned for February 11th. And, what we have in store on the Super Bowl this year, where we’re actually doing the national buy versus the regional, buy we had last year, triples our reach.
And I think just in even the teasers we’ve done starting last week, we’re already up to I think 11 billion impressions on those teasers and we haven’t even started the activation yet.
Olivia Tong: Great. Thanks. Best of luck.
Operator: The next question comes from Linda Bolton-Weiser with D.A. Davidson. Please go ahead.
Linda Bolton-Weiser: Yes. Hi. I was just curious, with your expansion activities in Europe, are you shipping from Asia to Europe, to fulfill those orders? And if so, are you experiencing any issues with shipping through the Suez Canal area, are you seeing any, spikes in freight rates that are affecting your costs? Thanks.
Tarang Amin: Hi, Linda. So, we do ship from China to Europe, for our European business. We use a combination of both, shipping as well as rail over Asia. And we found the rail to be a good solution for us. The shipping situation, we’re keeping our eyes on it, has minimal impact in this fiscal year. We’re keeping an eye for the future as we’ve seen some rates temporarily go up. We think that it’s a temporary thing, but we’ll keep our eye on it. And, right now, not much of an impact.
Linda Bolton-Weiser: Thanks. And can I just ask also, for Naturium, it was interesting what you said about expanding that brand already and to another retailer? I thought my understanding was that you were going to take some time to kind of, strategize and figure out how to go about it. Are have you changed with regard to your plan for the pace of expansion of that brand as you’ve gotten to know it better?
Tarang Amin: I would say our plans are relatively consistent. So, Naturium was already in discussions with Shopper Drug Mart. We knew about that when we made the acquisition. We’re actually quite excited about that, the first entry into Canada for that brand. When we bought the brand, we thought there are three areas where we could really give help to Naturium. It’s the team that’s doing extremely well, that entire team came on board. They’ve been on as part of the e.l.f. umbrella now for three months. They continue to run the business extremely well. The three areas where we could add value is number one, to the team to help enhance and expand the team for the types of things they need, whether it be regulatory, quality, manufacturing, there’s a lot of capabilities we have in a number of these different areas.
The second is to continue to enhance their marketing model. We have an incredibly effective engagement model with consumers, our ability to bring even more to that. And the third in distribution, the distribution ability really came to play with Shoppers Drug Mart. We already have a very good business there. So our ability to help them navigate through Shoppers to make sure that we’re getting both the best terms as well as the best levels of support. So, I’d say it’s more consistent than not. We’re extremely pleased with our first few months of Naturium, continues to be a very strong growing brand with a great deal of potential.
Linda Bolton-Weiser: Great. Thank you and congratulations.
Mandy Fields: Thanks Linda.
Operator: The next question comes from Bill Chappell with Truist Securities. Please go ahead.
Bill Chappell: Thanks. Good afternoon.
Tarang Amin: Good afternoon.
Bill Chappell: Maybe you can help us understand the outperformance in the quarter. And I understand you have a solid track record of conservative expectations or forecasts. But I mean, this seems to be upstanding in terms of the beat and all across the board. So, what drove or was there any couple of factors that drove the upside, especially as I think we were all looking at kind of tougher comps as we entered December, but you seem to kind of surpass that and keep on moving even as we see the scanner data today. So, what is it anything changed? Anything stepped up? Was there something different or were you just really conservative on your guidance?
Tarang Amin: Well, I would say, Bill, When we talk about exceptional, consistent category leading growth, that’s exactly what you’ve seen for us for 20 quarters in a row. We cite the stat of we’re one of only five public consumer companies out of 274 that have grown 20 consecutive quarters at over 20%. So, I think it’s more consistent than not. In terms of the quarter, the quarter did come in better than we were expecting. And it really is, all three of our key drivers working in concert. So, if I look at our value equation, our powerhouse innovation, and our marketing engine, we continue to see great strength and great fundamentals in each of them. During the period, results are during the holiday period. We had a number of our latest holy grail launches do exceptionally well.
We talked about our lip oils that we launched. This was an idea that really came from our community. They saw a prestige item that they really liked at $40 and basically like e.l.f. We love that, but we can’t afford $40. So, we developed ours with our own e.l.f. Twist. Our lip oils hydrate better, have a better [dough slit] (ph) in terms of application. Formulations are incredible. And right when we launched them, we saw them take off virally right away with consumers making the direct comparison of it’s actually better than the Prestige product. We’ve seen similar results as we think about our Camo liquid Blush, at $7 versus a Prestige item at $23. So, we continue to build upon these growing franchises. That along with our increased marketing levels and what we’re able to do from a value equation standpoint, I think is continue to propel our business.
As Mandy said, we do expect Nielsen to be in that lower range, but we still feel really good even with Nielsen comping very strong numbers. For example, this time last year, I think our target business was up over a 100%, and we still continue to see really strong numbers on top of those strong numbers. We feel really good about the 53% growth that’s implied in Q4, even though we’re comping a quarter that’s closer to 80%.
