huff’s gravity model
TRANSCRIPT
HUFF’S GRAVITY MODEL
By
Anoop, Durgesh, Fahim , Anand ,Ranjan , Venky
HUFF’S GRAVITY MODEL
Based on the premise that the probability that a given customer will shop in a
particular store or shopping center becomes larger as the size of store or center grows and distance or travel time from customer
shrinks
ASSUMPTIONS:
The proportion of consumers patronizing a given shopping area varies with the distance from the shopping area
The proportion of consumers patronizing various shopping areas varies with the breadth and depth of merchandise offered by each shopping area
The distance that consumers travel to various shopping areas varies for different types of products purchased
The “pull” of any given shopping area is influenced by the proximity of competing shopping areas
HUFF’S MODEL FORMULA
tripsshopping of kinds different on time travelofeffect thereflects that oexponent tAn
center shopping point to starting scustomer' from distanceor timeTravel
center shopping of Size
center shopping particular a to travelingorigin ofpoint given aat customer a ofy Probabilit
Where
ijT b
ijT
jj S
jiijP
n
1jb
ijTjS
bijTjS
ijP
UNIVERSITY AND SHOPPING CENTERS: GRAVITY MODEL ILLUSTRATION
IFIM Business school TOTAL Mall500,000 sq ft
OLD TOWN100,000 sq ft
Forum Mall1,000,000 sq Ft
3 m
iles
5 Miles
1 mile
HUFF’S MODEL: THE SOLUTION
Pij = 1000 32
(1000 32) + (500 52) + (100 12)
Probability = .43
.43 x 12,000 students = 5,160 customers
5,160 customers x Rs.150 = Rs.774,000
Repeat steps 1 to 3 for the remaining areas and then sum them.
Thank You