Features, Strategy and Operations, Trends

April Showers Bring May Flowers — and More Customers to Buy Clothes

Have you been watching the weather recently? A foreboding-sounding weather system, a bombogenesis formed over the Atlantic Ocean that l traveled up the coast. Fortunately, it was to be a fast-moving system that was out over the ocean and didn’t have much impact inland, but the coasts were hammered.
A bombogenesis system means air pressure drops dramatically and rapidly and results in a “bomb cyclone,” which hit the Midwest this past winter. A bomb cyclone is as bad as it sounds: torrential rain, or if it’s cold, record-breaking snowfall and wind, near hurricane-level gusts.

It seems like all this new weather we are facing –bomb cyclones, the polar vortex and the rest – are a sign of the devastating effects of climate change. But you’d be wrong. These are terms used day-to-day in meteorological circles. The fact that we have just now heard them is simply a sign of the power of media and our dependence on it.

“All of those things are not new things. They’ve been around for a long time. It just so happens they are cool sounding and make for a great tweet. Media is enhancing the impact of weather events like never before,” says Paul Walsh, IBM’s global director for consumer strategy and previously with The Weather Company, now an IBM subsidiary.

In his role at IBM, Walsh helps companies, most especially retailers, plan for the effects of weather. Of course, as Bob Dylan sang, “You don’t need a weatherman to know which way the wind blows,” and every retailer knows that weather has a profound effect on shoppers’ behavior. We now have better tools and data that result in better weather forecasts.

“Historically we have heard the weather excuse over and over, with CEOs blaming weather when they missed their numbers,” Walsh says. But they can’t rely on that excuse any longer. “We now have the data, forecasts and ability to measure precisely what the weather will mean in terms of what consumers will be wanting and buying and change our businesses accordingly,” he continues.

Just recently, The Weather Company released its spring forecast, and it couldn’t be better for fashion retail. After a particularly late winter, spring will come earlier this year with milder weather. It will supply a favorable tailwind to fashion retail.

A Warm Spring and Late Easter Will Bring More People Out to Shop

“The weather’s impact on consumers, on their product choices and for planning their lifestyle is greater now than it ever has been,” Walsh believes. But consumers still plan their lives around what’s happening right outside their door, not on what the calendar says. That can mean trouble for fashion retailers which traditionally think in terms of seasons, while shoppers react to the immediate weather.

“Nowadays, we don’t buy based on the calendar; we buy based on how we feel. For seasonal apparel, the switch is turned on when it feels like spring,” Walsh told me. “Only then do we look into our closets and say it is time to update.”

It’s what Walsh calls the “cabin-fever effect.” Last year it happened quite late as spring didn’t really turn until late April and early May. Combined with an earlier than usual Easter last year, people didn’t feel like it was time to refresh their wardrobes until much later in the year.

This year will be different, as a late Easter, April 21, will give a longer runway to sell spring and summer fashions. “When it starts to feel like spring, we will see an extra amount of demand,” Walsh predicts, which should start to happen next week.

Given the differences in last year’s and this year’s spring, he sees retailers will benefit from good weather-driven comps. “Our predictions show that it will be a warmer than normal April,” he says.

This, however, could challenge retailers that may not be ready to meet increased demand for spring apparel. “Most retailers plan their upcoming seasons based upon the last season, so obviously they are planning for a relatively slower start this year,” he shares.

It doesn’t have to be so, since weather forecasting is getting better at predicting weather effects on retail. “All consumer businesses, including retailers, CPG and QSR companies, are increasingly looking at weather differently,” he says.

That gives fashion retailers the ability to pull weather data into their replenishment systems so that on Monday or Tuesday they can anticipate what inventory needs to be in the store to fulfill customers’ needs on the weekend. “That data can also go into their pricing systems, to adjust prices to move excess inventory quickly,” he adds.

Retailers that leverage weather data have an unprecedented ability to meet consumer demand where and when it is needed. “Weather used to be an uncontrolled risk factor. Now retailers are beginning to leverage it to better serve their customers and so better serve their shareholders,” Walsh continues.

How Retailers Are Leveraging Weather to Grow Sales

Walmart and Subway are retailers that use weather insights to anticipate customer needs in advance of changing weather. He also shared how Walgreens and hair-care brand Pantene use weather strategically to bring people into the store.

Themed around the concept of the ubiquitous bad-hair day, Walgreens and Pantene use data analytics to study the different kinds of weather that cause them, such as dry days, humid days, windy days. Together they aligned the appropriate Pantene product for that kind of day in a “Haircast” mobile campaign, that was geo-targeted with a $2 coupon to redeem for products at Walgreens.

“It was super effective at driving traffic into Walgreens and sparked product demand,” Walsh shares. “But it also had a halo effect when people came into the store and bought other things they saw.”

Just think of the number of flip-flops, shorts and bathing suits a similar weather-targeted program could move?

In a final question, I asked Walsh about how weather may impact online shopping, since even in a Polar Vortex or a Bomb Cyclone, people can shop, as long as the electricity holds out.

“Weather’s influence on shopping is increasing no matter if you are shopping in-store or online. But today people can plan their lives around the weather, especially now that we carry weather forecasts in our pockets thanks to mobile phones,” he explains.

“The favorable weather we will see this spring will encourage people to get out and shop for seasonal fashion earlier. And once they are in the store, fashion retailers can benefit from the ‘halo effect’ to buy other things that catch their eye,'” Walsh concludes.

Fashion retailers are set for a great spring/summer season. And heaven knows, fashion retail needs it. With the retail market booming last year, up 5.3 percent over previous year, excluding motor vehicle and parts dealers, clothing retailers underperformed, advancing only 4.3 percent, and department stores, heavily dependent upon apparel sales, did even worse, down -.9 percent.

It’s time for fashion retailers to turn this favorable weather forecast into dollars.

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