Retailers frequently blame the weather when sales come up short — but the rise of e-commerce may be robbing them of that excuse.
(Bloomberg) — Retailers frequently blame the weather when sales come up short — but the rise of e-commerce may be robbing them of that excuse.
Bad weather will spur an additional $13.5 billion in US online spending this year, up about 3% from last year, Adobe Inc. said in a report Wednesday. The study, the first of its kind by the software provider and its e-commerce research unit, is based on an assessment of past shopping patterns combined with data on rain, snow and wind compiled by the Weather Co., a unit of IBM Corp.
“A modestly rainy day can push more people to shop on their phones or computers,” Adobe said.
The findings could help brands and retailers predict shopper behavior more accurately, giving them a new tool as spending migrates online, Adobe said. The exact effects will depend on the exact weather conditions, of course, and the impact is sprinkled throughout the year. But Adobe estimates the cumulative total of sales sparked by bad weather outweighs Cyber Monday, the largest online shopping day of the year, which generated $11.3 billion last year.
“We see this as having massive implications for brands across the country,” said Vivek Pandya, an analyst at Adobe, adding that reacting to weather can help companies to fine tune their promotions and supply chains. “We always assume weather has some impact on spending levels and behavior. This has been really able to show the magnitude.”
Some of the gains occur when bad weather prompts shoppers to stay home, which has traditionally eroded brick-and-mortar stores’ revenue. But now, homebound consumers purchase goods with money they would have otherwise spent on services such as eating out, boosting e-commerce totals.
“It’s uncommon to see this kind of effect shine through the data so clearly,” said Costa Lasiy, another Abode analyst.
While the impact varies depending on the particular conditions, Adobe drew some broad conclusions:
- Rain provides the biggest online sales boost, accounting for $8.7 billion. The effect peaks when there’s rainfall of 0.8 to 1 inch (2.5 centimeters), which would typically mean three hours of heavy rain. And the shopping gains are particularly strong on weekends and in the fall.
- Wind is expected to lift online sales by $4.4 billion, but it only helps up to a point. Speeds of more than 25 miles (40 kilometers) an hour cause e-commerce to wane as the wind grabs people’s attention. There are also regional differences. Strong winds cause e-commerce to drop in Atlanta, while shoppers in Chicago keep spending through the same conditions.
- Snow accounts for a small boost, with geographic variations. In cities with low snow totals, such as Austin, Texas, and Charlotte, North Carolina, even a little drags down sales as consumers focus on the weather. In cities such as New York and Seattle, snow prompts people to stay home and shop more online.
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