Omni-channel retail marketers with online sites and offline stores have often wondered about the effect that weather might have on their site traffic (which in turn would affect their paid search bidding strategies). There appear to be three competing hypotheses about weather affecting site traffic:

  • Hypothesis #1: Site traffic is negatively correlated with weather quality — the better the weather, the lower the site traffic as people like to get out and buy products in store (substitution effect).
  • Hypothesis #2: Weather has little to no effect on site traffic because surfing online shouldn’t depend much on weather (independent).
  • Hypothesis #3: Site traffic is positively correlated with weather quality (synergistic).The theory here is that, when the weather is good, many people think about the store but start their searches online. A good fraction of these searches end with online purchases; as a result, weather quality is directly correlated with online site traffic.

The effect of weather on sales has been studied in the past. A paper from the Federal Reserve Board of Governors dealt with it at length and had several interesting findings. Most notably, it found that good weather had positive effects on sales for restaurants, durable goods, automotive and apparel, among other sectors.

Not surprisingly, food and gasoline sales are not affected by weather, as people need both regardless of weather. However, while this paper dealt with offline sales, it did not touch upon online sales and the online-offline substitution effect. It was this gap that motivated my analysis.

Before I get started, I want to highlight the fact that this is a very preliminary study with a very small sample size, both in terms of advertisers as well as DMAs studied. However, despite these limitations, the results are quite compelling.

Weather Affects Restaurant Searches

First, I looked at the connection between weather and restaurant searches by taking weekly weather data and mapping it with Google Trends data for “restaurants near me” in Chicago. This is an “obvious” case where we should see a connection between weather patterns and a localized search for restaurants.

Better weather would prompt more people to eat outside in restaurants, especially in a place where the weather patterns show large fluctuations. In a sense, this is our control where we should expect to see a connection.

temperature and search interest in restaurants

The regression shows a clear connection between temperature and restaurant searches. Note that we have not controlled for other factors such as seasonality and holidays here. Despite that, the crude regression explains 51% of the variance with statistical significance (significant p values). This appears to validate the offline effect of temperature seen by the Fed researchers.

Weather Affects Retail White Goods & Construction Verticals

Next, I took the weekly website visitor and sales data for a set of retailers in the white goods and construction verticals and looked for patterns of site activity in 4 DMAs — three on the East Coast, where the season and temperatures vary significantly over the year, and one in Los Angeles, where the temperature and weather patterns are more stable.

website sales and termperature

Here, too, we can visually see a correlation (76%), even just looking at day-level of data without controlling for seasonality.

Using a dummy variable-based regression approach, I then investigated the role that weather conditions like snow, fog and rain play in website traffic and sales. Interestingly, in all East Coast DMAs, rain did not affect sales, but snow affected sales representing 11-15% of website sales. The graph below gives the intuition behind it.

effect of snow on online sales

Note that for days where the temperature was similar, the weeks with no snow (blue dots) produced more sales than when there was snow (red dots). For most East Coast DMAs, snow during the week lowered sales by between 10 and 15%. This effect disappeared in Los Angeles. Interestingly, rain did not have any effect in any of the DMAs investigated.

Key Takeaways

While this analysis is very preliminary and over a small sample size, it is quite apparent that temperature and adverse weather conditions (snow) do have an effect on website sales for some omni-channel marketers. Perhaps what is most interesting is that online and offline sales appear to be affected by weather the same way (i.e., online-offline sales appear to be synergistic).

Good weather motivates people to buy goods both online and offline. The data seem to validate the third hypothesis above, i.e., that many offline conversions begin with an online search, a fraction of which convert on site itself, another fraction of which end at the store.

Snow has a big effect on site sales. In the 4 DMAs that I investigated, snow had a statistically significant effect in reducing sales by 10-15% from the site’s average. Interestingly, rain did not affect site sales.

Finally, it is worth considering weather forecasts as part of your bidding strategy (for at least some verticals). This would especially be the case for snow days, when sales drop significantly.  However, it remains to be seen if a bidding strategy factoring in weather would have a significant impact on SEM performance.  If you have factored weather into your search engine bid management strategy, do share your story!

Opinions expressed in the article are those of the guest author and not necessarily Search Engine Land.

Related Topics: Channel: SEM | Paid Search Column | Search Marketing: General | Search Marketing: Local Search Marketing | Search Marketing: Shopping Search Marketing

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About The Author: is Director, Business Analytics at Adobe. He leads a global team that manages the performance of over $2 BN dollars of ad spend on search, social and display media at Adobe.

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  • http://www.rimmkaufman.com/ George Michie

    Really interesting research, Sid. We shop when we feel good and we feel better when the weather is good. One point on bidding though: the fact that online sales are depressed by snow does not imply that the conversion rates or average order sizes are lower, it could simply be an issue of search volume. If that’s the case, companies bidding to advertising efficiency objectives should not change bidding strategies unless they can determine that the value per click is different, not simply the click volume. Companies selling snow boards might also see trends different from those selling gardening supplies :-)

  • Edwin Romero

    We should start optimizing the weather.

  • Jeff Nogaj

    Great post! For food delivery we’ve seen a direct correlation with poor weather, increased search volume, and increased conversion rates. The biggest problem right now with weather triggered bidding is the inability to scale the model when running many PPC campaigns targeted to hundreds of different cities. We need a tool that can match campaign locations with a dynamic weather feed to automatically bid up and down in real time. Does anybody have any thoughts on how to automate a bidding strategy like this?

  • Pat Grady

    We see inverse with one client – foul national weather and everyone’s inside with nothing to do, bored, they search for things like “learn to play guitar”. Loves me a massive snow storm (just not here in Florida).

  • Chris Georgakopoulos

    How weather affects sales is different from place to place. You cannot extract generic assumptions. For example how rain days affect online sales is quite different in London compared to Athens. In Athens, rain days are rare and are usually boosting online sales. People know that rain will last for a max of 1-2 days, so they stay inside surfing the web, because for such a short duration they can postpone a large range of going-out activities. (Example from apparel industry, we’re actually rain-dancing to see our sales climb :-)

  • Weather Trends Int.

    Jeff, Weather Trends International may be able to help you out. We have the ability to match any location in the world with our weather data (both historical and forecast up to a year in advance). We’d love to discuss with you further, please check us out at http://www.wxtrends.com

  • Adam Francis Higdon

    Hi Jeff- maybe the tools looks at all of your markets in aggregate and executes bids based upon predicted cost and conversions in those markets – again in aggregate. And maybe you can adjust your model half life so that the data being used is weighted to show more recent trends, taking into account the traffic based upon weather patterns. And there are some other details to share, but you would need to call your friends down the street on Washington at the Adobe office for us to share more detail. But you are on to something I can assure you!

  • Joy

    hello we are running an classifieds in india.when there is raining heavy in of listed cities on our site,we experience 30% to 40% traffic drop particular from that city only

    editor – http://www.chillyads.com

  • Sid Shah

    Indeed. If the ROI doesnt change, one needn’t change bids. Regarding snow boards, there is actually a paper looking at the connection between weather and lift ticket sales http://jtr.sagepub.com/content/47/3/359.abstract

  • Sid Shah

    I am planning to look at a larger dataset by vertical and geos and also look at other metrics like ROI,not just traffic and revenue.Ultimately, I believe that website sales might be positive or negatively correlated with weather based on the business and people’s attitudes to weather in the region. So one must analyze their own dataset to draw conclusions for thier business.

  • Prasanth Kallay

    Facebook follower base is quite important when it comes to improving your online marketing. I have had fairly good results with http://www.TwipQuick.com when it comes to building my follower base.

 

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