It is a journey that we began, as you know, two years ago, and each year we’re making progress in bringing it down because all three of those strategies – our smaller networks, cost as a percent–you know, cost from the distributor, as well as revenue productivity in our flagship, ShopHQ is critical. For example, 123tv already has a content distribution cost as a percent of their net sales in the mid to low single digits, so they’re already in the place that ShopHQ will be, we believe in the next 12 to 18 months.
Thomas Forte: Thank you for taking my questions, Tim.
Tim Peterman: Thanks Tom.
Operator: Thank you. The next question today is coming from Mark Argento from Lake Street Capital. Your line is now live.
Mark Argento: Hey Tim, just a couple quick ones. Was hoping you could peel the onion a little bit, it looks like units were up pretty nicely on a year-over-year basis, ASPs are down, customers up. Maybe just talk a little bit about what you’re actually seeing with the customers right now as you move into the holidays.
Tim Peterman: Sure thing, Mark. The numbers you’re seeing are aggregated between 123tv and ShopHQ, so there is–that’s the first point we need to make, is that 125tv’s units, they’re average–you know, when we talk about ASP or AOV, the ASP – average selling price is not even half of what ShopHQ is, and that was one of the core things that was important for us to fix at the 125tv business and their customer profile, was we need to make sure that the ASP is growing in a way in categories that they do well in, so that when we do promotional events or we do free shipping, or we engage the customer and we have to pick, pack and ship it, we’re not doing 10 units to get to $100, we’re doing five units or four units. That critical business model shift is what you see every single quarter from us, and you’ll see that the units will start to calm down again and move–the ASP will start to move up again.
That’s just simply fixing the challenges at 123tv, which were exactly the same as they were at ShopHQ when I returned in the middle of 2019. These are fundamental things we know how to fix. That was one of the exciting things we saw in the opportunities with 123tv beyond the strategy and what I would call the catalyst of bringing their expertise from gamification into ShopHQ, which as I’ve noted we’re doing a soft launch of their auction shopping widget – I’ll give away the secret sauce of it is today’s top auction instead of today’s top value, but both will be featured on ShopHQ as we tweak that model and that consumer experience and we head down the path for the spring of next year around doing the same thing and disrupting travel.
Mark Argento: Just a follow-up on the domestic business from an inventory perspective, how are you feeling about your mix of product relative to what you think consumers are gravitating towards here and some movement into holidays?
