As it relates to the mix, we are definitely increasing our investment in direct mail but the largest increase in investment on a mixed basis is in digital advertising.
So while we are going to continue to have substantial support in our more traditional advertising like our tabs or our broadcasts, both TV and radio, digital advertising has got the largest single increase in the marketing budget.
Jeffrey P. Klinefelter (Piper Jaffray): So while the total dollars might not drop any faster than sales, you are getting more in prints for the same dollars by using digital?
Kevin Mansell: Yes.
Lorraine Maikis (Hutchison - Banc of America): Can you provide some color on what you are basing your negative 5% to 8% comp on, is that reflective of the current trends?
Wesley S. McDonald: It is reflective of the year trend which was down 6.9% and reflective of the quarter trend which was down 9.1%. It does not have anything to do with the February trend.
Charles Grom (JP Morgan): What is your comp hurdle rate looking like for 2009 and is the sensitivity to the margin line for every one point comp move up or down?
Wesley S. McDonald: It is basically flat for 2009. We hope to do better as we get through the year and as it goes down it is probably around 15 basis points on the down side and probably on the up side it is around eight to ten.
Charles Grom (JP Morgan): Could you wash out the step up in rent that you are going to see that is going to increase the pre-opening?
Wesley S. McDonald: It is really a function of the fact that on ground leases you have to start expensing them seven months ahead of time so if we open all those Mervyns stores in October a vast majority of those are ground leases we have to start taking expense on that in February.
It is not a cash expense, it is just how you have to account for straight line rent when you factor that in. It is also possible to make a little bit of a splash in October when we are opening 30 some stores in California.
Charles Grom (JP Morgan): So is your actual pre-opening going up or is it just the way it accrues through the model?
Wesley S. McDonald: It is the way it accrues through the model. The actual cash out the door is actually down.
Charles Grom (JP Morgan): Could you discuss about any trends you have seen in California over the past couple of months and any benefit you have seen from that consolidation in retail and how much of that you are assuming will continue in your guidance?
Kevin Mansell: We are not making any assumptions about business going forward as it relates to the California, the elimination of Mervyns as a particular competitor in California.
When we put guidance out of negative 5% to negative 8% it is basically based on the 2008 actual results being a negative 6.9%, in the fourth quarter 9.1%. So there is nothing about that in there.
More recently upticks in particular stores that are closely located to former Mervyns locations.
Robert Drubel (Barclays Capital): Can you comment about what you are seeing in the competitive environment?
Kevin Mansell: It is not so much about the competitive environment, it is about the customer environment.
The initiatives that we had in place last year that definitely helped improve margin are still in place, but we want to make sure that we have the flexibility to use that potential lift to drive and deliver great value because we recognize that the customer is facing a very difficult economic environment.
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