Business Formulas

Gravitation Analyst in a Nutshell

William J. Reilly published a classic work in market analysis entitled The Law of Retail Gravitation. Inspired by the formula for gravity, Reilly proposed that a similar formula could be used to calculate the point at which customers will be drawn to one or other of two competing centers. In other words, Reilly's formula allows us to determine in Km, for instance, the space within which an outlet is more likely to draw its customers from. In the map below the line connecting all whiskers delimits this space.

Our tool applies the Law of Retail Gravitation as originally postulated by William J. Reilly.

This analysis can be of great help to marketing and sales managers when segmenting territories for assigning budgets, planning surveys, measuring advertising, circumscribing area test markets, assessing performance, and more.

Gravitation Analyst lets users customize labels and it recognizes automatically whether to run a single or a multi-city analysis. The map you see above is created using Excel and can be edited just as any other Excel chart.