Clothing and footwear, pet supplies, automotive parts, and other category-focused or specialty retailers see traffic levels and sales of specific products vary on a day-to-day basis and differently across stores and markets. Planalytics’ predictive demand analytics for specialty retail enable companies to adjust inventories based on when, where, and how much the sales of specific products will increase or decrease due to the weather, the most impactful outside variable influencing daily buying behavior.
How consumers respond to changes in the weather will provide a lift or a drag on traffic levels and overall transactions for specialty retailers. Depending on the sector, it is typical for the weather to move sales 3% to 5% (either positively or negatively) throughout the year with even more sensitivity seen in specific geographical markets or time periods. For particularly weather-sensitive product categories the weather-driven sales variability is even higher — 24% (of annual sales) for boots, 8% for bicycles, 18% for automotive wiper blades, 7% for flea & tick control, 12% for outerwear — are just a few examples. (Note that the above examples are industry metrics. Planalytics also provides specific weather impact models based on retailer-specific sales data, locations, store types or channels, etc.)
Specialty retailers can integrate predictive Weather-Driven Demand (WDD) analytics into existing processes and technology solutions to grow profit margins through increased sales and lower costs.
- For planning and allocation, WDD calculations isolate and remove weather volatility from historical results to reduce plan error and keep retailers from “chasing” the prior year’s weather and its sales impacts. WDDs improve accuracy and enable companies to position inventories to take advantage or weather-based sales opportunities and manage risks and costs (e.g. markdowns) where weather is likely to be less favorable than the year-ago period.
- For reporting & analysis, WDD metrics give businesses the visibility to clearly gauge performance and evaluate results (such as regional sales, promotions, marketing campaigns, etc.) from a weather-neutral perspective.
- For digital marketing, WDD analytics help retailers more optimally target campaigns and improve click-throughs, sales, ROAS, and more.
For more details, we invite you to request a financial benefit estimate for your business.