David Aufderhaar: Yeah. Blake, on the first part of your question, I think you’re talking about EBITDA throughout the year, and the guide for Q1 was between $2 million and $7 million and then the guide for the full year was between $5 million and $30 million. And so you can see from that that we actually do expect to be profitable in the back half of the year as well because that’s — going back to what we talked about in prior calls like our focus on profitability has been something — we have been really digging into and we’re certainly proud of the work that we’ve seen there. And so we expect to be EBITDA positive for the year. We also expect to be free cash flow positive for the year as well.
Matt Baer: On the second question, I can jump in there and David feel free as well. But in terms of the key metrics that we track from AUR, AOV and keep rate, overall we’re seeing relatively stable metrics across the board, and then going forward we’ll be working to put processes in place and strategy in place to improve those metrics over time.
Blake Anderson: Got it. That answers it. Thank you.
Operator: Thank you. Our next question comes from the line of Tom Nikic of Wedbush Securities.
Tom Nikic: Hey, everybody. Thanks for taking my question, and Matt, welcome aboard. I just want to ask — so obviously, you had a big revenue decline last year. You’re calling for another double-digit revenue decline this year. So kind of, in aggregate, it’s a pretty significant decline versus where you were a couple of years ago. Just kind of conceptually sort of the idea that you’re kind of resetting the revenue base to I guess kind of — sort of a healthy sustainable base and then you find opportunities to grow from there. And I guess when you do kind of think about like how to kind of inflect to the top line from negative to hopefully positive again like how is inflecting customer growth? Is it a share of wallet like how do we think about that? Thanks.
Matt Baer: Hey, Tom, I appreciate the question. It’s Matt. I’ll answer that question and then David if there’s anything you’d like to add, please, feel free. So in terms of where we see the business going forward and where our focus remains, we’re working really hard to ensure that we have a healthy foundation for our business that we have a healthy inventory position for our business, that we have healthy client franchise for our business and that we have a healthy financial and P&L ultimately for our business. And we also have a strong perspective that as we continue to invest in and deliver experiences that resonate best with our clients, and as we continue also to ensure that as we really judiciously rationalize our marketing spend, we’re going to be able over time to both improve the experience and do a better job acquiring high lifetime value customers that will ultimately lead to future revenue growth and we’ll be able to do that on a profitable basis.
What I can also tell you confidently is that the service that we provide is a phenomenal one. The ability to get product delivered to your home that matches your style preferences, that aligns with your value orientation, that actually fits is surprisingly rare experience, and it’s one that we have an exceptional experience and we excel in competitively. And I believe that, that service resonates with an incredibly wide audience and untapped future markets which over time will be able to expand our target market audiences and deliver growth. Right now, we’re focused on the healthy foundations for our business and in the future, we’ll be focused on driving that long-term profitable growth.
Tom Nikic: Understood. Thank you very much.
Operator: Thank you. Our next question comes from the line of Dylan Carden of William Blair.
Dylan Carden: Thank you. I’m just curious maybe even follow up to that last answer. How are you thinking about the relationship now between marketing and sales? You’re kind of keeping the ratio relatively stable next year. Is that driven by the sales outlook or is that driving the sales outlook? And kind of what’s the strategy as it relates to retention and sort of new customer engagement? Thanks.
Matt Baer: Hey, Dylan, appreciate the question. It’s Matt. I’ll answer your question and then David if you’d like to provide some additional color, feel free. What we’re focused on right now in marketing is exactly as you called out that we need to ensure that when we go to market, we have a judicious marketing spend that rationalizes every dollar to ensure we’re doing our best job to acquire high lifetime value customers into our portfolio. And I’ve been — based on my experience, I’ve seen where at times, if you’re just chasing client growth from a vanity metrics perspective, you can get yourself into some really difficult situations that become then ultimately very difficult to unwind. More important for me and the guidance to the team is that we need to focus on the health of our client franchise.
So are we acquiring the right customers? Are we acquiring customers that display all of the signals that would indicate a high likelihood of high lifetime value? And how the marketing team is focused and what gives me a lot of encouragement is that there is a few different things that guide their work. The first is that they go to market with a really clear audience focus. They know who it is that they’re speaking to and who it is that they are working to acquire. Two, they’re doing a really good job of telling our story, what’s the uniqueness of our brand, which is the uniqueness of our business model and what is that value proposition for our prospective clients? Three, they’re doing a good job balancing the budget between higher funnel brand and awareness campaigns and then lower funnel programmatic acquisition tactics.
And to your point, we also have to be very mindful in terms of our retention and reactivation campaigns and the marketing team is really dialed in here as well. And recently we’ve had a lot of success in terms of re-engagement, and then going forward, we look to continue those efforts not just to continue to harvest reactivation but also to improve retention and fend off dormancy in the first place. So we feel confident that if we focus on these right things, we get the client experience, right, we’re really acquiring and engaging with high lifetime value customers will create a better trajectory for our total client health over time.
Dylan Carden: Thanks. And I guess sort of a follow-up on that. I mean is I don’t know if you’re going to answer this per se. But as you think about sort of the active customers you’re left with now at the end of this year and to your point about kind of unwinding past marketing spend or unwinding past growth. Do you feel you kind of mentioned the stability of some of those key metrics? Do you feel like this $3 million some is a more engaged core group? Or you’re still kind of weeding out some less efficient customer base in the model?
