Retail Gravity Modelling is becoming the analytical tool of choice for modelling consumer spatial behaviour in retail and service industries worldwide. The trend in the U.S and U.K. over the last five to ten years is clearly away from traditional regression modelling in favour of gravity theory.
Retail gravity is based on the simple theory that any consumers choice of store or shopping centre will be based on two fundamental considerations, 1) convenience (travel time); and 2) store attractiveness.
Using a model built around these assumptions, probabilities of consumer patronage to any store or shopping centre from any location can be calculated. By introducing the spend potential of areas into the models, accurate estimates of turnover potential and market share can be calculated.
Gravity models are so powerful because they are representative of the choices consumers make in the real world.