Essay: Market Penetration Approach

Sample Essay

Market penetration approach supposes a competition that the spatial variation between the households is because they prefer different stores. This approach exemplify Huff trade area model that defines probability surface as a representative of customer backing possibility.

The basic food for thought of the Huffman model is selecting one out of various stores in the same area. Spatial interaction model involves the attraction, competition, and distance parameters on which probability surface bases upon. Probability surface can be made up to regions of customer backing probability. These probability surfaces are used as weights to make the market profile. Integration of data on consumer’s preferences for selecting a retail site is modeled in huff model by analyzing trade area in a more complex way. The complexity is generated when the data of customer’s preferences is used and information of shopping routes is measured (Dramowisz, 2005).

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