Store ClusteringNash Equilibrium in action Whydoyouthinkcompetitorsopentheirstoresnexttoeachother,Mrs.Mariam Why do you think competitors open their stores next to each other, Mrs. Parker?Well,it'sallaboutattractingmorecustomers.Mrs. Parker Well, it's all about attracting more customers. If stores are too far apart, a new business will set up in between them.So,customerswillnaturallygravitatetowardsthecloseststore,right?Mariam So, customers will naturally gravitate towards the closest store, right?Exactly!Mrs. Parker Exactly! This creates a demand that encourages more stores to open nearby. It’s the Nash Equilibrium in action and is called Hotelling's law.So,it’snotjustrandom.Mariam So, it’s not just random. It’s a strategic move to capture market share!Right!Mrs. Parker Right! Stores of the same kind tend to clump together, maximizing their visibility and foot traffic.Thatmakessense.Mariam That makes sense. So, what’s the solution to avoid oversaturation in one spot?It's"Thinkdifferent"Mariam!Mrs. Parker It's "Think different" Mariam! By doing something different, you can help everyone get what they need and ensure it's not a race to the same cluster!Why do competitors open their stores next to each other? Nash Equilibrium why do all stores endup at the same spot. imagine two stores far apart, a new business will be placed inbetween the, users will go to the stores that are closer togehter. More stores will open to capture that demand. Stores of the same kind clump. what is this law. @Mariam @Mrs. Parker Image prompt theme: +Illustrators:Dick Bruna
