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FEDERAL STATE EDUCATIONAL INSTITUTION

OF HIGHER EDUCATION

NATIONAL RESEARCH UNIVERSITY

HIGHER SCHOOL OF ECONOMICS

Saint Petersburg School of Economics and Management

Identifying non-price factors affecting beer products sales in russia, assessment of their influence, analysis

Iatcenko Kseniia, Pyatkina Anna

Master's thesis

Educational programme `MANAGEMENT AND ANALYTICS FOR BUSINESS'

Saint Petersburg - 2020

Abstract

beer market weather condition

It has been proven that various non-price factors influence the volume of beer product sales. In Russia there have been no studies investigating the influence of such a non-price factor as the weather conditions. Studying the Russian market is important because it has unique characteristics that are not similar to any other country in the world. Russia is a multi-cultural country, a large area covers several climatic zones, the regions differ from each other, which gives sales in each zone special features. However, at the moment there is still no researches who studied the effect of weather on sales. Despite the fact that many researchers have come to the results that this indicator has a strong impact on sales. Also studies that were conducted in the Czech Republic and Turkey prove that sales of beer products depend on weather conditions.

Objectives of this paper: find out if the weather conditions affects the volume of beer products sales in Russia; determine which of the weather factors are significant in the regression of beer sales in Russia; define how exactly significant weather factors affect sales of beer products; identify how weather factors affects sales of beer products within different regions.

The main statistical method, which is used in this research, is multiple regression with fixed effects. Database include information about beer sales of 604 different SKU (stock keeping unit), 78 brands in 24 cities and weather conditions in 24 cities daily during three years from 2017 to 2019. It was explored the impact of such non-price factor as daily weather on volume of beer products sales in different regions on basis of daily and weekly data. Such independent weather variables are used: air temperature, atmospheric pressure at station level, atmospheric pressure at sea level, humidity, wind speed, temperature of dew point. price factors: price per dekaliter in rubles and volume of discount and dummy variable of non-working days. Dependent variable: volume of beer sales in dekaliters. Furthermore, data includes products characteristics: type of product, type of tare, color of tare, volume of tare product, alcohol content, brand. For the fixed variables were chosen city, year and SKU.

We found that weather conditions have influence on beer sales . In addition, it is possible to establish exactly which weather variable is significant and how. The analysis proves that depending on the territorial location of the region, its characteristics and features, weather conditions will effect volume of beer sales in different ways. The list of significant weather variables: air temperature, atmospheric pressure at station level and sea level, humidity, wind speed.

Table of contents

• Abstract
• Introduction
• Literature review
• 1.1 Features of beer market in Russia
• 1.2 What and how influences on consumer choice
• 1.3 Influence on beer consumption (beer sales)
• 1.4 Impact of weather variables on consumption
• 1.5 Impact of the weather on beer consumption
• Methodology
• 2.1 Research design
• 2.2 Data collection
• Results
• References
• Appendix

Introduction

The Russian beer market is growing on the background of lower vodka consumption and decrease of beer consumption in European countries (Colen and Swinnen, 2016). It leads to increase of interest of understanding the consumer behavior in this market, because it has positive impact on FMCG companies performance. More information about consumption could help companies to reduce uncertainty, decrease costs of transportation, production and storage, cut product's final disposal the level of fines by consumers and solve the problem of deficits, planning of production facilities. Retailers are familiar with general impact of weather on consumption and consequential seasonality in retail sales, but lack detail knowledge about precise relationship between weather and sales needed for operational, strategic and financial decision making. (Stulecet al., 2019) Russian beer FMCG companies witness the evidence of connection between rate of sales and the weather condition, but the lack of research and proven relationship between this factors limit companies from using it for their work and analyses.

On consumption behavior affects different factors: consumer characteristics, consumer context, consumer decision-making, product characteristics and marketing, direct context of consumption, political, technological, historical and geographical contexts. Recently, researchers have shown an increased interest in determination of more factor which influence on consumer behavior: the rate of time preferences. (Kossovaet al., 2017) and others.

A large number of studies investigate alcohol consumption in Russia. There is a growing body of literature that recognizes the importance of taking into the account of non-price factors of drinking behavior, such as age, gender, income, employment status, marital status, occupation status, and health status, among others. (Kossovaet al., 2017).

Weather effects have a strong influence on people's decision-making and consumption. (Sanders, 1982). Researchers provided the evidence that weather conditions affects on the mood (Persinger, 1975), willing to help others (Cunningham, 1979), the number of suicides (Digon, 1966), fatigue (Denissen, 2008), tip for guests of restaurants (Rind, 2001), purchasing patterns of people (Parsons, 2001). In recent years, companies have started incorporating weather conditions into their marketing and advertising campaigns.( WeiЯmьller, 2017). Authors Tianet al. (2018) found the effect of weather conditions, especially sunlight, air temperature and air quality on people's consumption.

Recently investigator has examined the effects of weather condition on sales of beer products and has found strong connection between them in the Czech FMCG Market (Kubista, 2018). From all of the above it follows that weather conditions should have a statistically significant impact on sales of beer in Russia.

The distinctive features of this research is that no previous study has investigated the connection between weather condition and sales of beer products in Russian market. Furthermore, besides the volume of sales and geography of purchase we took into account price parameters and specific parameters of the products and investigated the effect of the weather parameters for different regions.

This study confirms the theory that consumption is influenced by the context or current circumstances in which the purchase were made by finding the evidence of the connection between the volume of sales and the weather condition. In addition, this study contributes to the discussion of what factors should be taken into account for forecasting sales in FMCG companies.

This study has a practical influence, and it possibly can lead to improvement of real company processes. The results of this work can be used in the sales forecasting and short-term category planning, as well as ex-post analysis of the sudden changes available performance indicators.

The main statistical method, which will be used in this paper, is multiple regression with fixed effects.

The primary aim of this study is to identify how weather conditions affect the volume of beer products sales in Russian Federation

The object of this study is the volume of beer products sales in the different cities of the Russian Federation.

The subject of the study is the influence of weather factors on volume of beer sales in Russian beer company.

There are several primary objectives:

1. to find out if the weather affects the sales of beer products in Russia

2. to determine which of the weather factors are significant in the regression of beer sales In Russia.

3. to define how exactly significant weather factors affect sales of beer products.

4. to identify how weather factors affects sales of beer products with in different regions of Russia

This master's thesis is a continuation of the study of term paper 2019, written by the authors of this master's thesis. This master's thesis contains information from a previous work, as this information contributes to the results of this master's thesis.

1.Literature review

1.1 Features of beer market in Russia

FMCG market is a market of daily necessities. There is a large amount of foreign research that studies the FMCG market. However, this market has a number of features that do not allow applying the experience of foreign colleagues entirely to the Russian FMCG market, while companies need to understand the functioning of this market.

Beer products are part of the essential products, that is, there is a part of the Russian FMCG market.

Speaking about the peculiarities of the market, profitability in the market is achieved mainly due to high sales volumes, therefore, proper calculation and analysis is a necessary tool for the development of a large beer company at present. Purchases are made regularly and in large quantities.(Shinkina, 2013). In addition, the consumer does not devote much time to studying the special properties and characteristics of the product.

One of the following market features is high competition. The author Shinkina (2013) talk about low barriers to entry for new companies. This means that companies must always maintain their popularity and customer loyalty, understand their needs and facts that can affect demand. Here, of course, companies that have an analytical basis, will be able to quickly respond to any changes in the market and, thus, to take the lead thanks to quick response and action taken.

The companies represented in the FMCG market are, as a rule, well-known to the buyer brands, which own a predominant market share. Companies gain consumer attention through various marketing programs, through communication channels and loyalty programs. For example, well-known brands advertise on television, radio, social networks via the Internet, and so on.

FMCG companies are resistant to economic crises. This is due to the fact that essential goods are presented on this market. In the unstable economic situation in the country, when consumer incomes are sharply reduced, they will refuse to make large purchases, for example, household appliances or cars, in favor of food and the most necessary goods such as household chemicals and personal hygiene products.

Predicting sales in the FMCG market is very important due to product characteristics. A significant part of FMCG relates to perishable products, which imposes requirements for the mandatory observance of special conditions for its production, transportation, storage and sale.(Aleksina, 2018)

Thus, based on the foregoing, we can say that the FMCG product market differs from other markets in a number of key features that indicate that analytical models are necessary for companies to exist in this market, minimize costs and develop. Next, we consider the features of this market in Russia and note the importance of its study on the example of this country.

Authors Krasilnikova and Nikishin (2018) in their study on the features of regional retail in the Russian Federation, they came up with a number of problems that are present when studying the Russian market. Firstly, this is a big difference in the development of the country's regions, the researchers compared such criteria as “income level”, “GRP per capita”, 150-point amplitude in terms of investment. An assessment was made of the trends in trade and retail sales, where the reaction of the regions was completely different. Thus, we can say that when studying the FMCG market, it is absolutely necessary to separate it due to the large socio-economic differences of its parts-regions.(Krasilnikova et al.,2018)

Beer is one of the most popular drinks not only in Russia but also in the world. In recent years, even in small Russian cities, beer bars have opened, a new culture of drinking and spending time has appeared. The manufacturer offers many varieties and types of beer for every taste and budget.

Beer is a low-alcohol drink produced by alcohol, fermentation of malt wort (most often based on barley) with brewer's yeast, usually with the addition of hops. The ethanol content in most beers is 3-6%. Strong beer usually contains from 8.6 to 14% alcohol, but its share in the Russian market is extremely small - according to the results of 2013, only 0.03%.

It is the Russian brewing industry that, perhaps, over a quarter of a century has transformed itself stronger than other components of the alcohol industry. For 25 years, disparate breweries were merged into national holdings, and then foreign capital came into the country.

Four large multinational companies are currently operating on the Russian beer market. This is the Danish Carlsberg (controls the Baltika brewing company); SAN InBev, daughter of the Danish-American AB InBev (Hugarden, Staropramen, Leuvenbrau, Stella Artois, etc.); Dutch Heineken (Heineken, Amstel, Guinnessoriginal, Golden Bazant, Bochkarev, Okhota, etc.); as well as the Turkish company Efes (Efes, the Old Miller, Polar Bear, Bavaria, etc.).

In terms of beer consumption per capita, Russia is among the top thirty countries in the world. According to international comparison, in 2010 the first places were occupied by the Czech Republic, Germany and Austria, where the average per capita consumption was 131, 107 and 106 liters per person. Russia was in 26th place with a rate of 66 liters per person in year.

Beer is one of the most consumed drinks in the world, and Russia is no exception. The content of ethyl alcohol in beer is 3-6%, and in strong beer - 8.6-14%. It should be noted that the share of strong beer in the domestic market, according to the results of last year, amounted to only 0.03%.

The beer industry in Russia has more than 800 enterprises with different levels of capacity, located in 73 regions. Over 90% of the domestic beer market is distributed among six players.

Beer is one of the most popular drinks in the Russia, and in consciousness of many Russians, it is not perceived as "real" alcohol. It is this fact that explains why, according to three main characteristics of consumption - volume in liters, penetration and frequency - beer occupies an intermediate position between soft drinks (of which kvass and even carbonated drinks are comparable categories for it according to the above characteristics) and other alcoholic categories ( vodka, spirits, champagne, wine, alcoholic cocktails). It is also worth noting that the volume of beer consumption - in liters - exceeds the volumes of all other alcoholic categories combined.

Draft and packaged beer are distinguished, which, in turn, is divided into types of packaging (glass bottle, aluminum can, PET - plastic containers). The main share of the market is expectedly occupied by packaged beer: 42% falls on beer in PET, and 24 and 18%, respectively, on beer in a glass bottle and a can. Draft beer occupies no more than 16% of the total category.

More than half of total consumption falls on three regions: Volga Region, Central and Southern Federal Districts - 22, 20 and 14%, respectively.

Earlier it was noted that packaged beer occupies a significant part of the market, but the situation varies from region to region. The share of draft beer in the total volume of the category in the Southern and Siberian districts reaches one third, while in Moscow it is 5%, and in St. Petersburg - only 2.7%. It should be noted that a similar situation has developed partly due to the difference in price. So, in Moscow a liter of draft beer on average will cost 116 rubles, and in St. Petersburg - 112 rubles. At the same time, in the Siberian Federal District the price will be about 70 rubles, and in the Southern Federal District - about 78 rubles.

The importance of modern trade channels for selling beer is growing. At the same time, the share of the channels of traditional trade falls - the main decrease in the category falls on them.

Speaking about the beer category, the fact that it is one of the most “promoted” in the FMCG market. About 11% of the total value in money terms falls on products sold during promotions. For comparison, in the same period of 2012, this figure was 8%, and in 2013 - 10%. The average price of a beer for a promotion is 69 rubles per liter, while the average price for a category is 77 rubles. It is also necessary to take into account the fact that the price spread in the category is extremely high, and, as a rule, the most noticeable decrease occurs just with premium brands and it is for them that the highest proportion of sales promotions is most characteristic.

In Russia, about 95-98% of all beer production falls on light beer with a strength of 0.5-8.6%.The remainder is the release of unfiltered, dark,semi-dark, special and non-alcoholic beer, as well as production beer cocktails and malt drinks.

The largest beer producers in Russia are Baltika Breweries LLC, SAN InBev OJSC, Heineken Russia and EfesRus. In total, in 2012 these companies accounted for about 81-82% of all beer produced in the country, while the share of Baltika in the structure of production amounted to more than 38% .

The attractiveness of the Russian beer market remains unchanged against other developing countries. In the regions of Russia, there is still great potential for further steady growth in sales.

The beer market has a limited capacity. This parameter is determined by two components: the level of beer consumption per person per year and the population (excluding migration and other demographic indicators). In addition, beer sales in a particular region are determined by the general potential of consumers, which takes into account retail turnover and population expenses by product categories, depending on traditions and style of consumption.

One of the most effective types of sales promotion, of course, is advertising.

The company conducts promotional events on television and radio channels both on the territory of the Russian Federation and abroad. In addition, it provides its Partners with promotional products with corporate symbols (catalogs, booklets, branded retail equipment). Information materials are published in the media (magazines, newspapers, as well as on the official website of Baltika Breweries)

A distribution system is being built in the Russian Federation with the provision of a marketing fund to increase sales volumes, conduct promotions and promotional events, as well as improve the representation of products in retail outlets. Further in our study, we will pay special attention to data on promotional activities, since, as mentioned earlier, this activity is of great weight, therefore it is important to understand the degree of influence so that the analysis model is the most accurate and the objectives of this study are achieved.

The authors studying the factors that influence the choice of packaging, the amount of alcohol in beer and the brand indicate that various characteristics influence the consumer's preferences - the external environment, the characteristics of the product and the characteristics of the consumer making the purchase.( Nguyen et al.,2018). The authors also note that the taste of the product would have provided one of the most significant conditions for selection, however, when making a purchase in a store, the buyer is not able to open the package and try the product before buying, as, for example, this happens during the purchase of wine. Before buying a particular type of wine product, the buyer has the opportunity to taste it and only then make a choice (Sбenz-Navajas et al., 2013). This study was held in the Vietnamese market, it was designed for three beer brands, namely, Saigon, Heineken and Tiger Consumers can use intrinsic (e.g. taste, color) or extrinsic cues (e.g. packaging methods, price, brands, product information) in their decision-making process (Kotler & Keller, 2009). Brand name, packaging format and price are the most important drivers for the choice of beer in this study. In general, the local brand Saigon is the least preferred to foreign brands (Heineken and Tiger), possibly due to the cumulative effects of the advertising campaign of the foreign brands. Consumers' preference for canned vs. bottled beer varies between brands and is heterogeneous among consumer groups. The authors say that, the small effect of the alcohol information on the consumers' choice may be due to consumers' familiarity with beer brand alcohol level or may be the alcohol levels in are too close. ( Nguyen et al.,2018).

Sales forecasting and analytics in brewing Company In this section, we will examine the existing marketing and forecast processes of Company, thanks to which the company does analytics and understands the needs of the market at the moment.

The production of competitive products is based on an instant reaction to changes in the market. All production management activities are aimed at this. And in this situation it is impossible to separate marketing and management, marketing and production - they are connected more and more deeply every day. And marketing has become one of the most important concepts for managing all companies.

When focusing on the market, the company creates conditions for coordinating the activities of departments and services, but reduces the possibility of specialization of employees in certain products. This orientation intersects with the regional orientation, because they are based on the principle of market segmentation, developed by specialist R. Smith.

Segmentation - the division of the market into independent sectors, characterized by the specifics of supply and demand. In accordance with segmentation, each consumer or their group can be a separate market with specific demand. When studying it, various data on customers are analyzed: geographical, demographic, economic, political, social, psychological factors.

Market segmentation is a very complex process that requires consideration and analysis of factors motivating the purchase. Supporters of the market segmentation strategy believe that only by dividing the market into segments can companies get the opportunity to develop a long-term market strategy for regulating production capacities in accordance with the requirements of existing potential markets. The principle of segmentation is increasingly used among manufacturing companies, and methods for classifying market segments are becoming increasingly difficult.

The study of the Russian market is not possible without its segmentation. This makes this study even more unique. Since further we will analyze and study individual regions of Russia.

Another important task faced by both manufacturers and retailers is to forecast the volume of goods that need to be produced, purchased and transported in order to fully cover the needs of customers for the product, but avoid an excess of goods in stock. In many networks, the need for a particular product is calculated based on data for the past period -- sales volume, dynamics of demand for certain products, the amount of money spent on advertising, and others. And there are two problems at once. First, a person cannot independently and accurately process such a volume of information in a short time and, moreover, make any forecasts based on it. Secondly, this scenario does not take into account many factors that retail may face-from a drop in the flow of customers at a particular point of sale to changes in economic conditions and the standard of living of the population. As a result, companies face various problems: for example, they purchase or manufacture products that are unpopular with customers, or they cannot prevent the outflow of customers.

The demand forecast team make an forecast for the next 13 week. It includes regular and promo forecast. The difference is that promo volumes connected with specific discount that company gives to the clients, distributors. Moreover, planning department, which management the inventory process and stocks, have safety stock only for the regular sales. Promo analytics monitor 3 next week of actual orders of the clients and forecast, and if it necessary add or cut the volume of forecast to give more operational information about future to the planning department. Last year company implemented the weekly meeting, where employees from sales, forecast, planning and promo department share their knowledge about future forecast and plan, give some insights. A recent major shift in retail trade tendencies and current economic circumstances, were company's main motivation to take part in project.

The reasons why identifying external factors for improving forecasting and making a statistic model is so relevant for the Russian market:

Growing interest of large retailers, in improvement of the forecasting processes. It is explained by the complexity of demand forecasting - inaccurate forecasts may lead, on the one hand, to a loss of sales for retailers, and, on the other hand, to penalties incurred by the suppliers as a result of under-provision of the product. (of running out of stock)

Growth of the promo-pressure (the ratio of the volume of sales sold during promo periods to the total sales) across all the consumer goods categories. Crisis periods can be one of the reasons for such a tendency.

Growth of the competition among the retailers and among the producers in attracting the shrinking consumer buying power

In addition, the growing popularity of the economic model of consumer behavior that incline them to be more promo-oriented.

Digital transformation and rapid development of Information Technologies also justify the relevance of the topic under consideration. Accumulation of huge volumes of historical data by companies on sales, promotion activities, data obtained from the loyalty card holders. Transition to the cloud-based solutions and calculations that significantly reduces the time required for processing the large volumes of data, including unstructured data sources. Statistic models uncover the patterns in large volumes of data, and moreover could help to spread of the application of these algorithms to the solution of business problems.

Other factors proving the relevance of the topic

Organization of the events aimed at finding competitive solutions for specific business problems with the use of large volumes of data.

Creation of specific departments in the business structure which would be aimed at the implementation of advanced techniques based on big data.

Growing openness of the market participants of sharing the data with partners, in particular greater transparency of information on sales at the selling points (among the retailers and suppliers). This allows to acquire additional inputs for demand modeling.

1.2 What and how influences on consumer choice

Sales have a close interaction with consumption. The importance of consumer demand forecasting is described by many authors. In that case, if a company understands the factors that influence its consumer choice, the company can learn to predict its sales using analytics methods.

Authors Adebanjo, D.a and Mann (2000) emphasize the importance of the ability to forecast consumer demand accurately to companies in the consumer market and described the barriers and problems, which group of forecasting and demand managers from some of the leading UK food companies observe in their work. The essential information for forecasting demand is past history of demand, promotion effect and the weather conditions. Companies need to develop a structured approach for identifying what information needs can help for forecasting.

Analysis of consumer behavior is currently associated with data analysis. Data analytics are critical to business value creation because they improve the effectiveness of customer segmentation and targeted marketing (Olson and Chae, 2012).

A considerable amount of literature has been published on the subject of what have the dominant influence on consumer choice. Researchers Ribeiro et al. (2018) comparing explanations for consumption from ten different disciplines underline the micro level of consumers, purposes and products; the meso level of the direct context as the main three levels that influence on the consumption and undergo historical transformations.

Next, we see it necessary for this study to understand in detail what influences consumer choice and, as a result, product sales, from the point of view of different disciplinary approaches. Further, we are going to describe factor, effecting consumption such as: consumer characteristics, consumer context, consumer decision-making, product characteristics and marketing, direct context of consumption, political, technological, historical and geographical contexts :

1. Consumer characteristics

Personal consumer characteristics play a large role in consumer preferences. About this writes Kotler et al., 2008, he highlights such characteristics as age, job, income, lifestyle and personality. For example, because of the current understanding of the characteristics of the consumer, companies can create more successful advertising projects that will encourage a certain group to buy certain products that are necessary for this particular group. This mechanism has been successfully used in many marketing research companies and is called consumer portrait (Haugtvedt et al., 1992)

Scientists from Uruguay have studied differences in preference among 200 buyers with different characteristics by gender and age. The study was conducted using a survey. Respondents were asked about their attitude to the following product groups: honey, yogurt, vegetable cream soup, sweetened condensed milk, and marmalade The results of the study showed a different attitude of customers to products depending on their socio-demographic qualities. Thus, the authors came to the conclusion that companies should focus their product on special groups of customers, and not act on the basis of the total market.(Ares and Gбmbaro., 2007)

2. Consumer context

Social characteristics of the consumer have an impact on its consumption. The authors investigated such social characteristics of the consumer as his environment - family, friends. They were able to establish that the prevailing cultural environment of society forms certain consumer characteristics. (Peter et al., 1999) In addition, the social status of the consumer plays a role, whether he has children, whether he is married or not (Moschis, 1985)

Social norms, customs, rules, goals of society have an impact on consumption. (Peter et al., 1999) For example, there are studies that prove that the cultural characteristics of different societies create different conditions for the perception of imported products. Thus, social norms create a certain consumer attitude towards products (Maheswaran and Shavitt, 2000; Ng and Lee, 2015).

3. Decision-making

This theory is that consumer behavior is the result of decision making. In a neo-classical economy, the authors who investigated this factor say that when making a decision, the consumer acts rationally maximizing his utility by associating with the economic advantage. But there are also authors who argue this theory controversially, they say that in addition to the economic component, the consumer is influenced by many factors that can play a crucial role in the purchasing decision, for example, social norms may be more important than the economic benefits of purchases.

In psychology, the result of a decision is explained by the individual and social aspects of the consumer (Ajzen and Fishbein,1980) Thus, individuals may be subject to different sociological and psychological influences that influence their choice. In such cases, their behavior is still rational, and they continue to consume goods that bring them the highest level of utility. (Jackson, 2005)

4. Product Characteristics and Marketing

This impact on the consumer is considered by the authors both in the field of economics and in marketing. In the economic aspect, attention is paid to the price of goods. The authors say that with a change in consumer welfare, his demand for certain products will change. For example, with an increase in income level, the demand for low-quality goods will decrease, and for higher-quality goods, demand will increase. It was also found that with an increase in consumer income, his demand for status goods increases. (Lipsey et al., 1999)

In the field of marketing the price of goods is also paid attention. However, advertising is still the key marketing mechanism for the consumer. Advertising has an impact on the consumer's view of the product. The impact on the consumer occurs through audio advertising on the radio, through television, magazines, outdoor advertising and so on. Thus, through advertising, “manipulating consumer preferences” occurs (Schnaiberg, 1980; Skidelsky and Skidelsky, 2001; Galbraith, 1984)

In addition, marketing in the beer market also plays a role. For example, the appearance of the package affects the choice of the consumer. In 2016, a study was conducted in Belgium on the effect of packaging color on consumer perception. One of the findings of the study was that the darker packaging was regarded by buyers as more expensive than it actually was.(Carvalho et al., 2017)

5. Direct context of consumption

Studies have also found that consumption is influenced by the context or current circumstances in which the purchase takes place. Such circumstances include, for example, light and smell. (Szmigin and Piacentini, 2015). In real life, we can see this influence in the usual city mall, where a bakery or cafe is located at the entrance of the mall, so it helps to spread a pleasant aroma to the hall. As a result, the buyer has a pleasant mood because of the aroma of fresh buns and he is more inclined to shopping. In addition, the pleasant aroma will remain well in consumer's memory and, most likely, he will want to return to this city mall again.

A study conducted at Nottingham in 2019 showed that students who drank beer at the On-campus Student Union bar at the University of Nottingham have different preferences for 2 types of beer brand.(Nijman et al.,2019) The authors also compare the results that were obtained by conducting an experiment in a bar and laboratory conditions, in which it was possible to establish that the results will differ depending on the context in which the consumer is located. (de Graaf, Kramer et al., 2005; Sester et al., 2013).

6. Other contexts

The influence of other contexts is also investigated by the authors. For example, other contexts include:

1. political, which includes various restrictions on sales and newly introduced state social programs (Kotler et al., 2008);

2. technological, which affects both the development of the product itself and the technology for advertising this product (Peter et al., 1999);

3. historical and geographical, which is expressed by the conditions prevailing in a particular locality. These conditions include trade routes. For example, the historical availability of a particular locality to one or another trade route influenced the development of its international trade -- some products could not be delivered to a particular locality because there was no transport link. This means that the geographical location determined whether consumer consumption would be available (Hartwick, 1998; Jackson et al., 2006). In addition, post-wartime, when consumption increases, can be attributed to the context of historical influence. (Glennie, 1995; Trentmann, 2016; Cohen,2004; Blonde and Ryckbosch, 2015).

One of the main element of direct consumption is weather conditions. This external factor may profoundly affect people's daily life(Tianet al., 2018). Next we look at studies on the consumption of beer products. Authors like Kossovaet al.(2018), Colen and Swinnen (2016), Bratina and Faganel (2008), Tomkins (2007), De Goeijet al.(2015),Perlman (2010), Tekin (2014), Skorobogatov (2016), Rubtsova (2016) investigated various factors that affect beer consumption. We will consider these factors and understand what place is given to the impact of weather on beer consumption.

1.3 Influence on beer consumption (beer sales)

In this section, we look at the consumption of beer and the factors that affect it.

In recent years, there has been an increasing amount of literature about beer consumption. Factors thought to be influencing beer consumption have been explored in several studies. A large and growing body of literature has investigated beer consumption in Russia concerning factors like: age, gender, income, employment status, marital status, occupation status, and health status, among others. (Kossova andSheluntcova,2017). The majority of these works consider beer consumption from the sociological view as social issue, include consumer context and characteristics.

Authors Kossovaet al.(2018) investigated the volume and structure of alcohol consumption in different Russian regions in 2016. Beer is one of the two main alcohol beverages in Russia. The researchers found that economic development and urbanization are positively related to consumption alcohol in Russia. Unemployment rate in regions negatively effects on beer consumption, instead of wine. The data from Federal State Statistics Service of Russia was taken for the analyses. The primary model of the study was chosen the model with fixed effects by testing different models. Higher income level and lower unemployment rate in a region are related to higher volume of consumed alcohol.

Another paper on the influence of economic development and globalization on beer consumption was written by Colen and Swinnen (2016). Their work measures the dependence in beer consumption on the income of the population in different countries. The researchers concluded that the increase in income causes an increase in beer consumption, but a high level of income means a drop in beer consumption. In addition, the authors took into account the historical aspect of the culture of beer consumption in different countries. It was also possible to establish the pattern of climate (temperature in different countries) and the consumption of beer products. "Climatic variables could be taken directly by alcoholic beverages." The authors attribute this to the fact that, historically, this or that locality was more or less adapted for the cultivation of cereals. That is, until the international trade was created, the population has already formed certain habits that influence the consumption of beer today, when the supply of beer products can be carried out in any amount thanks to international trade.

The following paper by Bratina Faganel (2008) who researched the Slovenian market using two major retail stores. They used Time theory to research variables such as beer prices, outside temperature, advertising expenditures and the consumer purchasing index that affects beer consumption. It turned out that short-term advertising campaigns have a positive effect on demand. In addition, with the use of state weather statistics, they were able to establish that in the summer period, sales of beer products increased. Thus, Bratina and Faganel (2008) that the outside temperature is a good variable for estimating the amount of beer consumed.

The authors of Tomkins et al.(2007) dedicated their research to the study of the dependence of the socio-economic status of men in Russia and their consumption of alcoholic beverages. The authors concluded that the dangerous consumption of alcohol by the unemployed poses a threat to the development of the entire Russian economy. In addition, it was possible to relate the level of education and alcohol consumption. Thus, men with a low level of education are more prone to dangerous consumption and hard drinking.

The study by Goeijet al.(2015) focused on the effects of the economic crisis on the consumption of beer products among men. The authors assumed that due to the deterioration of welfare, alcohol consumption would decrease. However, the indicator of psychological distress turned out to be more significant, it appears that the consumption of alcohol by men increases during the economic crisis.

Another work exploring the impact of the economic crisis on consumption was written by Perlman(2010). The authors are exploring the situation around the "Rouble crisis", shortly preceding the 1998 survey round. It was possible to establish that men with a low level of education began to consume more alcohol, but not women. And those men who lost their jobs, also increased their demand of alcohol products

The effect of alcohol demand on employment and wages in Russia was explored by the author Tekin (2004), using data from the Russian Longitudinal Monitoring Survey (RLMS)The findings of the study are that alcohol consumption does not have a significant impact on employment, however, we can trace the correlation between the level of wages and the amount of alcohol consumed.

Another factor that affects the consumption of beer products may be new laws from the government. The influence of the public sector on the consumption of beer was also studied by the authors. In the Russian Federation, there is currently a ban on the sale of alcoholic beverages at night, though this temporary restriction varies in different cities.

The author Skorobogatov (2016), conducted a study in which he was able to find out what impact the policy of restricting sales at night had on alcohol consumption in Russia. The author says that this policy had a visible impact on the consumption of wine, people began to consume more wine products than before the introduction of restrictions.

The consumption of beer products and the policy of restricting night sales in different cities of the Russian Federation had no effect.

In addition, another law from the government that can influence consumption is the introduction of restrictions on its advertising, which was adopted by the government in Russia. This effect was studied by authors such as Rubtsova and Vygovskaya (2016).The authors did not find a close relationship between the introduction of restrictions on alcohol advertising and the amount of its consumption in Russia. The obtained data, in particular, is confirmed by the results of a comparative analysis of legislation on advertising and alcohol consumption in Russia, the Republic of Belarus and France, which demonstrated that the stricter legislation on advertising of alcohol products does not correlate with the volume of alcohol consumption. However, the study found that the effect of restricting the advertising of alcohol products on consumer behavior is likely to manifest itself only in the long term. In addition, the authors say that a ban on television advertising of non-alcoholic beer was lifted in 2018, and an increase in beer consumption could be observed during the same period, but this could be due to the 2018 World Cup in Russia. Thus, we can say that the introduction of restrictions on the advertising of alcoholic products has no effect on the amount of its consumption in Russia.

Restrictions on the sale of alcohol imposed by the state were also studied by foreign authors. Since currently there is a tendency to promote a healthy lifestyle and proper nutrition, which restricts and prohibits the use of alcoholic beverages. Such government measures should reduce mortality and alcohol-related illnesses.

The authorities are confident that if the ban is made on certain days and times, then alcohol consumption will be reduced. Researcher Marit Hinnosaar (2016) studied this topic in Italy.

He came to the conclusion that this policy will have a minor effect on non-regular customers, but there is no significant effect on the decrease in sales of alcoholic beverages.

The author suggests introducing other restrictive measures using other tools such as taxes and fines.( Hinnosaar, 2016)

Studies dedicated to consumer behavior mostly take into account such external factor as weather conditions, at the same time researches about beer consumption especially in Russia demonstrate the connection between beer consumption and demographic, social and macroeconomic factors. Despite this fact the weather is considered as important variable, which influence on consumption of FMCG products.

1.4 Impact of weather variables on consumption

Weather effects have a strong influence on people's behavior and consumption. (Sanders, 1982). This is proved by the results of the research of the authors, which were conducted in various fields. Favorable weather conditions contribute to the acquisition of a positive mood by a person, he feels the happiness (Persinger, 1975) and is more willing to help others (Cunningham, 1979). Bad weather, on the contrary, is associated with negative behavior of people. Thanks to the research, it was determined that bad weather has a direct relationship with the number of suicides (Digon, 1966). In addition, with an increase in temperature, an increase in the mood of people in spring can be noticed, but such an increase in air temperature in summer will not have a positive effect on the mood of people (Keller, 2005). Also, some authors managed to trace the effect of pressure and sunlight on people, it turned out that these factors have an effect on fatigue (Denissen, 2008) and with an increase in humidity we can trace a decrease in concentration and an increase in drowsiness (Howarth, 1984). An example of the influence of weather on people is the study of Rinda(2001), which showed that favorable weather conditions (sunny, cloudless skies) lead to a higher tip for guests of restaurants.

Examples of the influence of weather conditions on people's behavior can be phenomena described in the influence of weather conditions on consumption and shopping decisions by the consumer.

Authors Murrayet al.(2010) focused their attention on the psychological aspect that the weather influences. The influence of sunlight on the mood of consumers during shopping is considered. It was possible to establish that with the increase in sunlight, the expenses of buyers increase. This was confirmed by three mixed methods studies in both the lab and the field.

Another others Tianet al.(2018) studied the effect of weather conditions on people's consumption. The main task was to find out why and how the impact effects. Three main independent variables were used: sunlight, air temperature and air quality. The authors argue that «Weather data have long been considered a crucial external data input in practitioners' marketing strategy». It was possible to establish that these factors have a positive correlation with the level of use. Moreover, «Prior studies have indicated that weather affects people's mood states, trading decisions and social behavior (Denissen et al., 2008;Hirshleifer and Shumway, 2003; Larrick et al., 2011). A few recent studies further suggest that weather may also affect people's shopping activities, such as car purchases and responses

Parsons(2001) investigated the effect of weather on the daily purchasing patterns of people. With the help of multiple regression analysis, it was possible to establish that rainfall and temperature provide cues for shopping decisions. In addition, he also put forward the hypothesis that changes in weather conditions can be associated with a change in mood that affects shopping.

Few recent studies examined the weather effect on specific product category sales: refreshing beverages (Blom, 2009), tea (Murray et al., 2010), spring herbs and vegetables (Behe et al., 2012) and apparel (Conlin et al., 2007; Bahng and Kincade, 2012; Bertrand et al., 2015).

The authors Stulecet al. (2019) investigated the sale of non-alcoholic beverages during the year when weather conditions change. They view weather changes every day. The dependent variable is the daily sales of non-alcohol products, and weather is independent. Weather includes daily variables such as: average temperature, rainfall and sunshine hours. As a result of their research, they found that sales of non-alcoholic products increase during the summer season with increasing temperatures. In addition, there is a ridiculous result that sales of non-alcohol products have a sharp rise in April and December, the authors attribute this to the main religious holidays (Christmas and Easter) (Dube, 2004; Divakar et al., 2005;Gustavsen, 2005;Blom, 2009).

In a German study of retail stores, authors study the effect of weather on sales. The authors Badorf and Hoberg (2020) were able to prove that the introduction of weather data allows companies to improve sales forecasts.( Badorf and Hoberg, 2020) Used data from 673 stores in Germany. As a result, it was possible to establish that the nature of the influence of weather depends on the location of the store. This suggests that market research should be divided geographically, since each location has its own characteristics and weather conditions will affect in different ways. The authors concluded that More accurate forecasts of customer traffic help to improve workforce planning in stores (Mani et al., 2015), price optimization and revenue management (Ferreira et al., 2016), and the inventory planning of stock keeping units (SKUs) (Williams et al., 2014).

Steinker et al. (2017) find that temperature, rain, and sunshine have a highly significant effect on daily sales for an online retailers.