Why do competing retailers sometimes cluster together?
An often-studied synergistic effect known as “cumulative attraction” can result when retail establishments locate near each other so that each can benefit from the increased volume of potential customers drawn to the cluster. The benefits of the increased traffic often outweigh the negative effects of a store’s proximity to its competitors. It may seem counterintutitive but in certain cases, retailers will actively seek to locate beside or across from competitors. Consider red-light districts, antique-store districts, auto malls, garment-districts and jewelry districts in many cities. These are examples of cumulative attraction.
An oft-studied synergistic effect known as “cumulative attraction” can result when retail establishments locate near each other so that each can benefit from the increased volume of potential customers drawn to the cluster. The benefits of the increased traffic often outweigh the negative effects of a store’s proximity to its competitors. It may seem counterintutitive but in certain cases, retailers will actively seek to locate beside or across from competitors. Consider red-light districts, antique-store districts, auto malls, garment-districts and jewelry districts in many cities. All are examples of cumulative attraction.
