Introduction
The Retail Gravity Model (also known as Huffs Gravity Model) is a modified version of Sir Isaac Newton’s Law of Gravitation. Gravity modelling studies retail choice, and the probability of a customer visiting a particular Centre/Outlet.
The idea behind gravity modelling is that the probability of a given customer visiting and purchasing at a given Centre/Outlet is a function of the distance to that Centre/ Outlet from his/her home or work, and its Attractiveness for the customer to want to use that centre/outlet rather than other retail opportunities. Attractiveness of the Centre/Outlet can be defined in a number of ways including the size, population density, internal or external characteristics, choice of products/services, appeal to a certain lifestyle and brand.
Benefits
- Determine the market boundaries of trade areas with accuracy
- Assess the site potential of home maker centres/shopping centres/outlets
- Study the cannibalization of own and competitors centres/outlets within a trade area
- Ability to undertake what-if and market share type of analysis
- Visualize findings using the latest mapping tools