Catchment analysis is a key part of identifying whether it is viable to open a new retail store or outlet in a particular location, taking into account factors such as which target groups you are trying to reach, the footprint of the chosen area plus turnover potential in the existing locations. It is worth spending time and resources on researching the chosen area to ensure that the new store will be profitable and will attract the required number of customers once open.
Shopping centres vary for a number of different reasons, and consumers will often be prepared to travel outside of their local area in order to shop at a centre of their choice. Effective transport routes and access to public transport will also have an impact on which shopping centre consumers will choose to go to, so transport routes will have an impact on the decision of the shopper. Consumers will also be influenced by factors such as:
For those brands which currently have multiple stores, it is also vital for them to carry out a catchment analysis prior to opening a new branch. The analysis will need to be modified compared to a study which would be carried out for a single outlet, in order to take into account how other branches are performing. Those branches which are performing well should be studied as to find out why they are doing well, does their geographical location have an impact on their success?
Catchment analysis is a highly effective tool which can help to determine just how and where to conduct a new business or expand an existing business. Understanding the types of consumers who are likely to buy your products can assist in seeking a location which will give the best opportunity to realistically target these people. It’s important to have a thorough understanding and knowledge of the target location in order to work out if it has potential to be gained from. Carrying out relevant research will help you to decide whether it will be financially feasible for you to open a branch of your business in a particular location.
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