In rain or snow, customers are buying at 'need'
Late winter snowstorms in the Midwest and Northeast and the prolonged coolness that is forecast to stretch into April will impact several home improvement product categories this spring — some favorably, some not so — according to Planalytics, which provides "business weather intelligence" to companies worldwide.
"Weather conditions are a primary driver of consumer buying decisions as people focus on products or services related to products like lawn and garden, or other 'maintenance needs,'" said Scott Bernhardt, president of Planalytics, during the company's Business Weather Intelligence Outlook webinar in late March. "Weather can drive purchasing decisions by creating a basic need, an elevated want or an immediate problem."
Bernhardt said today's consumer is more "cautious, planned and price-sensitive" in their spending. "Prudence is trumped by what a consumer needs or wants now," he said. "They are shopping closer to 'now' and buying at 'need.' The weather window of opportunity closes quickly."
The winter and early spring of 2013 have trended several degrees colder than the comparable 2012 period; for example, last year's spring temperatures began in February. By contrast, this year's normal readings are not supposed to occur until late April. "The extended cold and wet weather has put yard work on ice," Bernhardt said. "It's a difficult time for spring products."
The 2012-2013 winter/early spring has been characterized by more precipitation than the year-ago period. For the lawn and garden category, Planalytics predicts a 1% drop in sales for the month of April compared with a year ago.
While there are numerous positive indicators — stock market and housing recovery stats among them — spring demand is slow to start in most of North America because of the harsh weather that has postponed purchasing decisions.
The good news, according to Bernhardt and Maria Maldonado, a manager of client services, is that once the spring weather breaks, it will lead to a flurry of business activity. "In the Northeast especially, but other parts too, consistently colder temperatures will keep spring demand depressed, but a warmer late April will unleash pent-up demand for spring categories," Bernhardt said. "There is a lot of pent-up demand in many of the large population centers."
Weather: It's all regional
Jeff Doran, a manager of client services, said retailers should never plan their spring inventory based on the previous year's weather. "Last February felt like spring in many markets, and March-April was the hottest in 118 years," he said. "March 2012 is very unlikely to happen again; therefore, if you based your planning for 2013 on 2012 numbers, you'd be in trouble."
Due to the colder and wetter 2013 spring, the firm is predicting that lawn mower sales will be up 1%; however, lawn irrigation products will be down 4% and air conditioners down 2%.