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Stop raining on my parade: The Sales Implications of Weather
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Stop raining on my parade: The Sales Implications of Weather


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  • 1. Stop Raining on my ParadeTHE SALES IMPLICATIONS OF WEATHERDavid McDermott, Performance Director, 7thingsmediaReena Rai, Client Services Director, 7thingsmedia16th October 2012 @7thingsmedia @A4Uexpo #A4UIT1
  • 2. Contents• Session objectives• Why the session – Impact of weather• The study – Overview – Results • Initial insights • Product weather patterns • Events • North / South• How can we use this data?• What can we do?• Summary @7thingsmedia @A4Uexpo #A4UIT1
  • 3. Social media SEO PPC Mobile Lead generation International Display AffiliatesLONDON | NEW YORK
  • 4. Recent award successPerformance Marketing Awards, May 2012• Best Agency: 7thingsmediaThe Drum Awards, May 2012• Marketer of the Year: Chris BishopThe DADI Awards, Nov 2012• Shortlisted for: - Digital Team of the Year - Best use of PPC - Best use of AffiliateMarketing Industry Network, Nov 2012 “...the judges showered 7thingsmedia with praise because of their impressive• Shortlisted for: multichannel strategic approach and - Best Digital Agency the strength of the agency’s - Best Retail Strategy development within the industry.”
  • 5. Stop Raining on my Parade @7thingsmedia @A4Uexpo #A4UIT1
  • 6. Objectives 1 Research 3 years worth of sales data across a number of clients within the retail sector 2 Combine sales data with corresponding weather data across the UK’s major cities 3 Find any correlations between weather patterns and sales data Look at how accurate forecasting is within weather patterns 4 Discuss whether there is any validity at adapting online merchandising to 5 weather patterns @7thingsmedia @A4Uexpo #A4UIT1
  • 7. Weather is just the weather, right?
  • 8. This year... @7thingsmedia @A4Uexpo #A4UIT1
  • 9. We talk of a offline correlation @7thingsmedia @A4Uexpo #A4UIT1
  • 10. But what about online?
  • 11. The study• 3 years worth of sales data across retail clients totalling millions• 15 major city weather maps correlated with events (Rain, Snow, Sun, Wind etc)• Multiple data sets correlated and trended out @7thingsmedia @A4Uexpo #A4UIT1
  • 12. Study caveats• Researched and removed anomalies• Built algorithm to score data set and to ensure that data skews were minimised• Data set was fashion and predominantly ladies clothing
  • 13. The questions we then posed 1 How does the weather impact (positive/negative) to online sales? 2 What weather system impacts peak sales? 3 Do certain products sell better/worse at certain temperatures or events? 4 Is there a North /South divide? @7thingsmedia @A4Uexpo #A4UIT1
  • 14. The results
  • 15. Initial insights 28th of November 2010? SalesRevenue @7thingsmedia @A4Uexpo #A4UIT1
  • 16. @7thingsmedia@A4Uexpo#A4UIT1
  • 17. Initial insights• Average mean temperature had risen by 3 °C s in the 3 years• Mean temperature across the cities was 13 °C• 15 °C seemed to be the lowest frequency• Average highest temperature was 17 °C @7thingsmedia @A4Uexpo #A4UIT1
  • 18. Initial insights Rain Sales Revenue @7thingsmedia @A4Uexpo #A4UIT1
  • 19. Initial insights• The higher the temperature rises the less we tend to buy• Our optimal ‘buying range’ was between 16 °C to 19 °C @7thingsmedia @A4Uexpo #A4UIT1
  • 20. However...• The higher the temperature the more we are likely to spend! @7thingsmedia @A4Uexpo #A4UIT1
  • 21. Optimal product weather patterns?
  • 22. Optimal for casual skirts 19 °C• But can we also workout at which weather pattern works best at which temperature? @7thingsmedia @A4Uexpo #A4UIT1
  • 23. Optimal for jeans 11 °C and raining @7thingsmedia @A4Uexpo #A4UIT1
  • 24. Optimal for swimwear 21 °C and raining 25 °C• 2 different optimal temperatures and weather patterns @7thingsmedia @A4Uexpo #A4UIT1
  • 25. Do events get effected?
  • 26. Bank holidaysEaster holidays and May day:• Sales in 2011 decreased by over 50% when the Easter Bank Holiday temperature rose by over 140%• The temperature then decreased 60% in 2012 which saw and increase of over 150%! @7thingsmedia @A4Uexpo #A4UIT1
  • 27. The Royal Wedding affect..Week after Royal Wedding:• 2010 corresponding dates were over 120% higher with a 20% lower temperature• 2012 corresponding dates were over 200% higher with a 15% lower temperature• Where was the Royal bounce? @7thingsmedia @A4Uexpo #A4UIT1
  • 28. Is there a North/South divide?
  • 29. City revenue by temperature• Lowest comparable temperature (-4 °C ) the people in Manchester and Glasgow spent more than London• However, when the temperature rose by 1 °C Londoners spent more than Glasgow and Manchester put together• Optimal temperature for Manchester seems to be 13 °C whilst the optimal temperature for London is 17 °C…at - 6 °C Manchester spent more on going out dresses than they did on coats and scarfs! @7thingsmedia @A4Uexpo #A4UIT1
  • 30. How can we use this information?
  • 31. Predicting the weather• Accuracy for 1 to 2 days is high from 75% to 90% (MET Office)• Once you start forecasting over 3 days the accuracy can be anywhere close to 50% @7thingsmedia @A4Uexpo #A4UIT1
  • 32. But we work in Ecommerce• The offline world will merchandise a shop front based on the weather• If we know: – What product sells at what temperature – In which location – In a given set of events – That it is 80% likely to happen• Why do we not merchandise a website based on the weather when technology is there to change instantly? @7thingsmedia @A4Uexpo #A4UIT1
  • 33. Your typical trading plan Seasonality Promotional Strategy Spend in Market Competitor Strategy Activity React & Reflection & Targets /Granular measured tweak plans Learning fed KPIs to each Plans against where into next channel targets required quarter plans Ecommerce Trading Plan @7thingsmedia @A4Uexpo #A4UIT1
  • 34. What can we do? @7thingsmedia @A4Uexpo #A4UIT1
  • 35. Weather algorithm @7thingsmedia @A4Uexpo #A4UIT1
  • 36. What can we do?• Social communication: – Twitter updates – Facebook offers• Email – Network – Personal• Open trading plans based on seasonal products• Product related incentives @7thingsmedia @A4Uexpo #A4UIT1
  • 37. So what?Know when people will buy before they do and strategically time your advertising andpromotions to increase year-over-year sales• 1° COLDER = +2% increase in SOUP sales• 1° HOTTER = +1.2% increase in BEER or SOFT DRINKS sales• 1° COLDER = +4% increase in CHILDREN’S APPAREL sales• 1° HOTTER = +10% increase in SUN CARE products sales• 1° COLDER = + 25% increase in MOUSE TRAP sales• 1° HOTTER = +24% increase in AIR CONDITIONER sales @7thingsmediaSource: Weather Trends International @A4Uexpo #A4UIT1
  • 38. Summary 1 The weather affects online sales as well as offline 2 Products have an optimal temperature and weather pattern for sales revenue 3 Temperature fluctuations can dramatically affect bank holidays 5 day forecasting is effectively 50% accurate but provides information on the 4 likely temperature and weather pattern 5 Online is perfectly placed to react and change short term digital strategies and longer term product focuses @7thingsmedia @A4Uexpo #A4UIT1
  • 39. Thank you to: Whitepaper expected:- Our clients- Met Office NOV 2011- Coremetrics, Google to receive your copy email:- Weather Trends Int. Kenneth Yau, 7thingsmedia fin. connect: David McDermott Performance Director @7thingsmedia Confidential Information This document is the property of 7thingsmedia LTD. and is strictly confidential. It contains information intended only for the person(s) and or Company to whom it is addressed. All information contained herein will be treated as confidential material with no less care than afforded by your own company’s confidential material. All service and product names mentioned in this document may be trademarks or registered trademarks of their respective companies and are hereby acknowledged. Copyright © 2012 7thingsmedia LTD.