Journal of the Korean Operations Research and Management Science Society (한국경영과학회지)

The Korean Operations Research and Management Science Society (한국경영과학회)
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A Study on the Impact of Weather on Sales and Optimal Budget Allocation of Weather Marketing

날씨가 기업 매출에 미치는 영향과 날씨 마케팅 예산의 최적 할당에 관한 연구

  • Received : 2012.10.24
  • Accepted : 2012.12.27
  • Published : 2013.03.31
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Abstract

Weather is an influential factor to sales of companies. There have been growing attempts with which companies apply weather to developing their strategic marketing plans. By executing weather marketing activities, companies minimize risks (or negative impacts) of weather to their business and increase sales revenues. In spite of managerial importance of weather management, there are scarce empirical studies that comprehensively investigate its impact and present an efficient method that optimally allocates marketing budget. Our research was conducted in two parts. In the first part, we investigated influences of weather on sales based on real-world daily sales data. We specifically focused on the contextual factors that were less focused in the weather related research. In the second part, we propose an optimization model that can be utilized to efficiently allocate weather marketing budget across various regions (or branches) and show how it can be applied to real industry cases. The results of our study are as follow. Study 1 investigated the impact of weather on sales using store sales data of a family restaurant company and an outdoor fashion company. Results represented that the impacts of weather are context-dependent. The impact of weather on store sales varies across their regional and location characteristics when it rains. Based on the results derived from Study 1, Study 2 proposes a method on how optimally companies allocate their weather marketing budgets across each region.

Keywords

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