The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Dylan Douglas Carden - William Blair & Company L.L.C., Research Division - Analyst
: Dave, I just wanted to clarify 2 points on the model. When you're talking about gross margins for the fourth quarter, sequential improvement, are
you expecting kind of a promotional activity, at least the depth of it to improve relative to where your inventory levels are such that you should
see kind of a sequential improvement? And then on the advertising cost, it's 10% or so, low double digits, kind of the new level that you anticipate
being able to hold even in a more normalized environment?
Question: Dylan Douglas Carden - William Blair & Company L.L.C., Research Division - Analyst
: Great. And then maybe for both of you, just on the sort of the portfolio approach here. I'm just kind of curious sort of your thinking as far as rolling
some of these brands directly onto the Duluth platform, is there an opportunity longer-term to kind of incubate and maybe spin some of these
off, how you think about their presence in stores?
And then just given kind of the environment that we're in, is this something where you can maybe add a couple more tuck-ins to kind of sort of
further the strategy? Just would be curious what you're thinking around all that.
Question: Dylan Douglas Carden - William Blair & Company L.L.C., Research Division - Analyst
: Yes. And that's more what I meant -- Yes, and I guess maybe to that kind of same vein, the new customers that you're seeing kind of in, I think you
called this out last quarter as well, would you attribute -- I know you're doing some more innovation on the sort of core Duluth side as well, but
would you attribute some of that, at least to these newer brands as well?
And then I was just curious, I know we're kind of early days here, but have you seen kind of the stickiness of that new customer, maybe sort of
coming back to purchase around holiday or anything that kind of gives you some comfort as sort of the acquisition that you've seen in this
environment, if that makes sense?
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DECEMBER 03, 2020 / 2:30PM, DLTH.OQ - Q3 2020 Duluth Holdings Inc Earnings Call
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