Leveraging Weather Intelligence to Gain a Competitive Edge in Demand Planning
Social, news, weather and events, also referred to as ‘SNEW,’ ‘big data’, ‘digitization,’ whatever you want to call it, it’s here and not going anywhere anytime soon. For decades, we’ve relied primarily upon a single time-series – historical sales – to predict future sales. More advanced organizations have a systemic way of accounting for a small handful of additional variables, usually internal and promotion related.
These more advanced organizations are also gaining a competitive edge by leveraging additional variables, such as weather intelligence. Understanding the impact of weather and important weather KPIs enables you to have a better understanding of factors you can control versus what you can’t control within your supply chain.
Optimizing the Customer Experience with Weather Intelligence and Demand Planning
We’ve been hearing about customer centricity for a while now, but it’s moved from being a priority to the top priority. As consumers shop online and offline, their demands and expectations for personalization and fulfillment have gone through the roof. It doesn’t matter which channel they’re shopping on, they expect an omni-channel experience, which is putting a lot of pressure on retailers and their supply chains.
Consumers are driving a very powerful shift and are very demanding, making it much more complicated for retailers to optimize the customer experience. Retailers need an agile supply chain that allows for omni-channel acquisition and fulfillment. Even when an agile supply chain is in place, weather can still cause major uncontrolled disruptions and have a huge impact on consumer demand. And we’re not just talking about huge snowstorms. In fact, on average, over 90 percent of a retailer’s annual weather-driven sales volatility comes from the everyday weather changes (source: Weather Corrected = Better Demand Perspective webinar).
Weather Corrected = Better Demand Perspective
The fact is, there are many external forces that influence and shape demand – weather, competitors, macroeconomic factors, social sentiment to name a few. Until fairly recently, harnessing data and quantifying those forces was a nearly impossible task, and was manual and expensive. But, that’s all changing. Cloud computing, machine learning, online shopping and a general proliferation of digital data have made factoring externalities into the forecast a reality.
JDA and Planalytics have been on the ‘SNEW’ journey together for quite some time. Like most of our customers, we started with visibility and are evolving into automated processes for incorporating weather influence into the demand management plan and process. The JDA and Planalytics partnership allows us to deliver best-in-class weather analytics (analytics, not just weather data, which is an important distinction) in the context of a best-in-class demand management solution, which we believe will deliver tremendous value to our joint customers. If you didn’t attend the FOCUS 2017 session, you can check out the webinar here.
Are you interested in learning more about how you can incorporate SNEW into your demand planning efforts? Contact JDA today to learn more.