Don't Rain on My Parade
When planning a day at a theme park, water park, or other outdoor leisure destination, the last thing visitors want to think about is adverse weather dampening the experience. However, nature’s intensity and unpredictability often leaves visitors and attraction operators frustrated as they grapple with the impacts.
To address the increasingly salient issue of natural disasters, storms, and extreme heat thwarting leisure plans, a solution is emerging that not only mitigates financial risks for operators, but also guarantees a better experience for visitors: weather insurance.
IAAPA member Sensible Weather, a climate risk technology company that provides the customers of partner companies reimbursements if inclement weather prevents them from enjoying an experience, aims to protect both guests and attractions. In an IAAPA webcast titled "What to Do About the Weather," Business Development Manager Kari Manev and founder Nick Cavanaugh, who brought together the disciplines of climate science and finance to develop this coverage, share their insights.
Addressing Revenue Losses
According to Cavanaugh, the correlation between extreme weather events and a decrease in revenue is evident. He shares that renowned companies like SeaWorld Parks & Entertainment and Cedar Fair are not immune to the impact of weather, stating, "Outside of SeaWorld, Cedar Fair also recorded a drop in revenues due to heat waves this year. So, we’re now seeing these weather events actually impacting bottom-line revenues at these hospitality businesses and attractions.” However, many outdoor attractions are learning that when visitors know to expect reimbursement—or may be provided a future opportunity to make up for a visit on a day with severe weather—they are more likely to invest in an experience.
Potential bad weather breeds apprehension, even the early stages of the visitor journey. "The question is, where or when am I going somewhere? And there’s this question of, what can I expect from the weather? Especially when you’re booking outside of a weather forecast window,” says Cavanaugh. “Folks are taking off time and booking a trip in advance, they’re really taking a lot of time to plan out what they’re going to do, and if the weather forecast doesn’t shift, they don’t wanna necessarily have to cancel the trip altogether,” Manev adds. Weather guarantees alleviate this source of concern for prospective guests, increasing conversions in advance of a visit.
Increasing Customer Satisfaction
Adverse weather conditions almost always result in customer dissatisfaction. Cavanaugh illustrates this by explaining, "If you’re at a theme park and you’ve got two screaming children, and it starts raining, what do you do? Your hands are kind of tied." This not only leads to unsatisfied customers, but also increases operational costs and strains as attractions struggle to manage unhappy guests.
The aftermath of a weather-impacted visit can also result in negative reviews, decreased rebooking rates, and a tarnished reputation. “When you know that experience is over at the end of the day or at the end of the trip, people are, you know, remembering what they experienced and telling their friends, whether that's word of mouth or through reviews,” warns Cavanaugh.
Generating Positive Impacts
Mark Moore of Gulf Islands Waterpark in Gulfport, Mississippi, shares a compelling story that underscores the transformative potential of weather insurance. Challenges such as refund requests due to rain, on-property complaints related to weather, and a lack of pre-sales were all addressed by the implementation of weather insurance.
Moore was also shocked by how many visitors opted for the weather guarantee coverage. “I mean, the 40% of customers adding a weather guarantee to their ticket purchase is a number that we couldn’t have predicted. It was like an immediate adoption.”
As weather patterns become more erratic and disruptive due to climate change, weather coverage for guests will increasingly stand out as a transformative offering for the attractions industry. It not only addresses financial concerns for operators, but also enhances the overall visitor experience—fostering a mutually beneficial solution for all affected stakeholders.