Question-and-Answer Session
Operator
(Operator Instructions) We will go first to Colin McGranahan with Bernstein.
Colin McGranahan - Sanford Bernstein
Good morning. I was hoping you could talk a little bit more specifically about some of the cost reduction and expense management initiatives -- you know, what drove the little better results than you would have thought in 1Q and what are some of the opportunities in your focus through the year?
And then as just a quick follow-up, if you could talk about any impact you are seeing at all from the rebate checks that started arriving in the last several weeks.
W. Howard Lester
Well, with respect to the cost reduction programs, as we’ve talked last quarter and previously, we have virtually leaving no stone unturned. I mean, we’ve gone through and continue to all the essential activities in the company and we’ve looked at can we do those better. In some cases, we’ve had some reorganization; in some cases, we set more stringent goals for ourselves and we’ve had some favorable results in achieving those, like returns and replacements, as part of our whole supply chain initiatives. We’ve got a lot of those underway. We’ve made great progress throughout our domestic delivery to our customers. The final mile and in-sourcing are up, all the things we’ve talked about.
I think in our corporate cost centers, the same thing has been true. We’ve done some reorganization. We’ve been very thoughtful about new hires, although we are continuing to run our business in the most effective way that we can. We did this year froze our merit increases for the year for our associates, while at the same time we reviewed every associate’s compensation with the market and if they were not in line with the market, then we did correct that.
We have made improvement, as we’ve talked about, on our advertising expense where we had done other things with paid search and other activities there, led by Pat Connelly and all the teams in the brands. We’ve made real progress there. You saw some of that in the first quarter and you will continue to do it.
As Dave mentioned, our emerging brands, the profitability is up, so we’ve improved that over last -- over a year ago considerably. So across the board, I mean, we’ve got a lot of things. I could go on for a long time here about everything from how we are photographing our catalogs to how we are buying paper to how we are doing -- virtually everything that we do in the company, we are looking at everything methodically and we are not through. We have more things that we’ll be doing in the future.
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