“It’s back, it’s big and the business impact in California could be huge.”
Given the simultaneous fires and flooding rains in California. I thought it would be a good time to revisit our call on the expected consumer impacts in California resulting from 1) the on-going historic drought and 2) the developing (and potentially historic) El Nino event.
El Nino Review
We discussed the expected effects of the El Nino on California back on July 17th.
Here’s what we said then:
“From a planning perspective, therefore, marketers need to be thinking differently about how they communicate with consumers this year.
In California specifically, the effect of almost any rain this year (a relatively rare event recently) will be amplified and particularly impactful.
Retail, QSR, insurance and travel categories will be significantly impacted as people will be staying home and hunkering down at a frequency not seen in several years (at least).”
All this holds true today.
The only change to what I was advising is that the impacts are coming earlier and the effects on consumer demand will likely be even stronger than what we’d already called out.
When it Rains in LA
California consumers are typically more weather sensitive than people in other parts of the country simply because the weather in general is less volatile.
What this means is that smaller changes in the weather have much larger impacts on consumers than in other (more weather robust) geographies.