What is Weather Sensitivity?
Weather Sensitivity quantifies what percentage of a product’s total sales are directly attributed to changes in the weather for a specific location during a given time period. Planalytics Weather Sensitivity metrics are one of several metrics Planalytics calculates during the weather impact modeling process. The process analyzes multiple years of historic sales and weather data by product, market, and time period.
Why Does It Matter?
Weather Sensitivity indicates how much the sales of a product or service can vary due to the weather conditions in different locations at different times of the year. By understanding the extent to which the weather directly influences sales, businesses have better visibility into potential opportunities and risks. When Weather Sensitivity is high, it only takes a small change in the weather to see a significant consumer demand response; when Weather Sensitivity is low, changes in the conditions outside have a smaller impact on sales. With these insights, companies can inform a variety of decisions, from optimizing inventory
(e.g. adjusting safety stock or replenishment levels) to altering when, where, and how much to spend on digital advertising (e.g. boosting spend to drive sales during high sensitivity periods).
February Weather Sensitivity
In the month of February, 29% of Thermal sales in the Northeast are influenced by weather while only 6% of Thermal sales are influenced by the weather in the Southwest Coast.