Record February UK Warmth: Retail Boon or Fool’s Spring?

I’m in London this week for a great week of meetings with clients and colleagues.

Unfortunately I missed the record-breaking February “winter heatwave” and it’s now appropriately and seasonally grey and wet.

See — February could be warmest on record despite cold start

On the bright side it’s significantly milder than what I just left behind on the east coast of the US.

See — Winter Storm Scott Spreading Snow From Plains and Midwest to the Northeast Through Early Monday

U.K. Spring Weather Outlook

According to my colleagues at the The Weather Company forecast office in Birmingham the balance of spring is looking to be relatively mild in the UK but with the potential for wetter then normal conditions.

That means days with fine weather separated by periods of gloom and despair.

A typical British spring.

On the face of it this all sounds beneficial for spring retail. A strong early boost to spring buying, a late Easter and relatively normal weather expected for the balance of the season.

What could go wrong?

A Beast of a Comparison

In late February and early March of 2018 the so-called Beast from the East was pounding Britain with wind, snow and bitter cold and UK retailers suffered their worst quarter in a year — sales dropped 1.2%.

See — ‘Beast from the East’ responsible for biggest drop in UK retail sales in a year

Following the extreme cold and snow an early Easter combined with an extended period of warm weather led to a rebound in UK retail sales that continued through the summer.

See: U.K. Retail Sales Rebound on Warm Weather, Discounts

The net result was a spring retail sales boon with the “beastly” weather happening during a relatively low volume period for spring merchandise and the weather-driven demand rebound happening at exactly the right time.

The stars were aligned.

Fool’s Spring?

On the face of it the late February and March comparison will be a comp lay-up for retail this year — although the impact is always more complex than what’s apparent at face value.

For example — Waitrose and Partners reported that total sales for the week ending Feb 23rd were down (4.3%) compared to the equivalent week due to shoppers stocking up last year for the anticipated ‘Beast from the East’.

Here’s the thing about the weather impact on consumers — on the one hand it’s as obvious as the nose on your face, but in fact the impact is profound, pervasive and mostly underestimated.

As my colleague Claire Willlams, IBM’s U.K. Leader of Retail, AI and Analytics points out:

“Weather has a direct impact not only on the obvious like burgers and salads, but think about it – it impacts how customers feel which impacts their purchasing decisions, their choice of channel, in store manner – it’s everywhere”

On the whole though, the early onset of record warmth no doubt has driven sharp like-for-like sales increases for all manner of seasonal products as well as footfall into high street stores.

Headwinds ahead

But what Mother Nature gives she also takes away — the comparison for the balance of spring and summer will be particularly difficult (beastly?).

This year’s weather-driven demand conditions will likely result in a pull-back in sales when compared to last year as we move deeper into the Spring.

Even with a later Easter holiday and relatively normal British weather, the tail wind that last year’s fine spring and summer weather brought will likely be a head wind this year.

“Know the enemy, know yourself; your victory will never be endangered. Know the ground, know the weather; your victory will then be total.” — Sun Tzu

Just Add Weather

As I’ve noted in previous posts, while the impact of the weather is increasing, retailers are also increasingly leveraging the data in creative ways to quite literally turn opportunity into risk.

See: Weather Data is Transforming Consumer Demand Planning

Marks & Spencer is a great example of how this is working. According to Ricky Mompalao, Head of Forecasting for Ambient Foods:

“Marks & Spencer uses weather data to help predict the level of demand we can expect for items across our UK stores. We use this information to plan our stock and, at the same time, minimise waste. To help us get this right, we’re looking at weather forecasts weeks in advance, with a level of confidence that means we can better prepare our stores.”

For more on how the retailers are leveraging weather data see our white paper, recently published by the IBM Institute for Business Value —

You can download it here: Just Add Weather

Executive Summary:

Don’t blame it on the rainWhy do so many executives get a shiver in their bones just thinking about the weather? It’s likely because weather often has a largely negative impact on business. Yet according to our recent research, that’s not true for all organizations. Many companies are turning weather data into a competitive advantage by leveraging insights to reduce costs and increase revenues. Just how are leading organizations successfully benefiting from weather insights to improve their bottom lines? Stop wondering if a hard rain’s going to fall and learn how to put weather to work for your organization.

Leave a Reply

Your email address will not be published. Required fields are marked *