Silver lining: E-tailers forecast better business in bad weather
Some e-tailers are hoping that inclement weather will keep more people indoors and shopping online as more bad news and sluggish sales continue to hit e-commerce heading into winter.
When bad weather hits, it tends to keep more shoppers indoors and prompts them to do more shopping online, several e-tailers said Monday.
"Shoppers were very interested in having us bring them groceries instead of trudging out in the snow to buy them themselves," said Mark Roe, a vice president at online grocer Webvan.
The Foster City, Calif.-based company said it had a 30 percent increase in orders in the Dallas and Chicago areas as customers there stocked up in preparation for storms that struck last week. Webvan customers in Atlanta were beginning to flock to the site Monday as scattered snow showers were predicted to hit the area Tuesday, the company said.
New York-based Internet convenience store Kozmo.com and the Web unit of home improvement chain Home Depot also saw Web site traffic spikes recently in areas hit by storms. Kozmo delivers goods to homes in chilly winter cities such as New York, Boston and Chicago.
Toy e-tailer Toysmart.com, which ceased operations in May, used to closely watch the weather, former executive Gabriel Fried said. In bad weather, the Waltham, Mass.-based company bulked up its server capacity to handle the potential extra load of customers.
A blizzard of customers
"We'd look at traffic spikes by regions and find a lot of customers came from Colorado," said Fried, who added that one jump came directly after a blizzard hit the Rockies.
In contrast, traditional brick-and-mortar retailers have always feared bad weather, said Scott Bernhardt, a senior vice president at Planalytics. The Wayne, Pa.-based company helps companies predict the influence of the weather on their businesses.
"Before the Internet, retailers were stuck," he said. "A snow storm on Sunday could mean big losses for a store."
The past three winters have been unusually mild, Bernhardt said, but this winter is shaping up to be much more harsh.
Snow, wind and freezing temperatures fell over states in the Northeast, South and Midwest on Monday. The National Weather Service was calling for much of the same for the Prairie states later this week.
Internet retailers can use the bad weather to their advantage in other ways as well. For example, companies can target advertisements around the weather, as people are more likely to be inside and online in a snowstorm than when it is sunny outside, Bernhardt said.
"Ultimately, you shop online because the trip to the store is a hassle," Fried said. "Whether it's standing in lines at the mall or driving in icy conditions, people will look for ways to avoid that."