PROFILE

Herb Sorensen

Scientific Advisor Kantar Retail; Adjunct Ehrenberg-Bass; Shopper Scientist LLC

Herb Sorensen is the winner of the 2013 Charles Coolidge Parlin Award and the 2007 EXPLOR Award, both from the American Marketing Association. He was also listed among Fast Company’s 2004 Top 50 Innovators.

Herb began his career as a chemist with interests in quantum mechanics, electronic structures and metabolism. From the faculty of Colorado State University in 1971 he moved into the business world as a board certified clinical chemist, subsequently establishing his own consulting and laboratory business providing product development and other services (including consumer surveys) to the packaged goods industry.

Since the late 1970’s Dr. Sorensen’s market research has focused on shoppers at their points-of-purchase. Hence, the continuing interest of his “in-store research company” in shoppers and their relationships to the stores they shop in and the products they buy.

Herb has a Ph.D. in biochemistry from the University of California, a master’s degree in biochemistry and nutrition from Nebraska and undergraduate majors in chemistry and mathematics. He has been an active member of the American Marketing Association and other associations for many years. His papers and presentations have addressed a wide range of topics, most recently his electronic shopper tracking system, PathTracker®.

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  • Posted on: 12/01/2017

    Will click & collect finally compel retailers to remodel stores?

    So online retailing has grown to 10 percent of the total market, while brick-and-mortar retains its 90 percent share -- at this point. I've see a fair amount of click and collect that is more or less a disaster, and I've seen plenty of empty drive-thru pickup stations, including Amazon's earlier this year.But nobody wants to confront why an industry built on moving pallets around, to stores, having unpaid stock-pickers (aka shoppers) doing the picking and delivery to themselves, can't just smoothly move to a process where THE RETAILER has to provide paid labor to replace all that free labor -- not to mention the rest of the strange, item-level logistics.If you stop thinking like the crowd, you can easily see that this pallet-based crowd is going NOWHERE serious. Very reminiscent of the hundreds of millions spent on smartphone shopping. Duh!
  • Posted on: 11/30/2017

    It’s good to be Home Depot

    Being in "semi-retirement" and getting to a lot of projects that have accumulated over the years, I am sometimes in Home Depot more than once a day. I also am a big fan of Amazon, as "the everything store." However, Home Depot wins against Amazon often, based on the TWO fundamental advantages that brick-and-mortar has: immediacy (I need it RIGHT NOW!) and experiential. That second advantage, experiential, I have often described as the 360-degree shopping experience.On that "experiential" advantage of brick-and-mortar retailing, there were some very important insights in an Aeon article yesterday: "Why you need to touch your keys to believe they’re in your bag." Sometimes I don't need the "experience" of the in-store purchase, and maybe "immediacy" is not an issue, and Amazon's infinite long tail, "the everything store," is needed to get some rare component, THEN Amazon beats Home Depot.These are the reasons that Home Depot is elbowing its way to a position in the "$100 billion" club of global retailers. They can fix their obvious flaws, and I am pretty sure they will.
  • Posted on: 11/16/2017

    Amazon Go still plans to transform convenience in retail stores

    It had to come to this. But no brick-and-mortar retailer would consider giving up that final forced stop of shoppers in hopes they can sell them something more while they are waiting in line to pay -- and plenty of suppliers are willing to pay for this "one more crack," at the shopper. I know, I know! There was a fair amount of technology development necessary to make this all feasible.And then there is the issue of what will happen with the "fifth wall." That wall facing the checkout that creates other significant commercial possibilities. But then we are well down the road to "Selling Like Amazon... in Bricks & Mortar Stores!"."
  • Posted on: 11/13/2017

    Retailers need supply chain urgency – now

    And I should point out that replacing unpaid stockpickers (shoppers) with paid store staff is less than an intelligent addressing of the problem. Plus, what to do with all those largely unused "click and collect" stations? (Which CANNOT be operated profitably, anyway!)
  • Posted on: 11/13/2017

    Retailers need supply chain urgency – now

    Hear, here! ;-) Thanks, Jamie, for actually getting to the nut kernel of the problem. Finally, there are TWO of us. Hopefully we can do more than simply watch reality trump practice. I love it!
  • Posted on: 11/13/2017

    Retailers need supply chain urgency – now

    Amazon's highly automated supply chain is designed to deliver single items to single shoppers. Brick-and-mortar retailers' supply chains are designed to deliver PALLETS to stores where unpaid stock-pickers, aka shoppers, pick and pay for the merchandise.Although I have repeatedly brought up this hard and driving fact of the battle between brick-and-mortar and online, I have yet to see even a single comment on this definitive fact.
  • Posted on: 11/08/2017

    Big Data is done, put a fork in it

    Data does NOT think, nor is it creative. It is gas in the tank, not even the vehicle, much less the driver.
  • Posted on: 11/06/2017

    Can Kroger make a name for itself in fashion?

    If you look at the list of the top seven global retailers, all over $100 billion in sales, Walmart (#1), Amazon (#3) and Kroger (#6) are in the pack driving for the pole position. For Walmart, never forget Disraeli's comment upon ascending to the Prime Ministership of Britain, "I have reached the top of the greasy pole."And I do believe that Kroger is the only one of the seven that is a US-only company.It has been many years since Kroger was a grocery-only business. They acquired Fred Meyer quite a few years ago, a 100-year old regional chain that had evolved into their own "shopping mall" format at least 50 years ago, under the leadership of their founder. The significance of Kroger's Fred Meyer acquisition was that they moved Fred Meyer's leadership (shopping center) into the highest levels of Kroger management.So much for misguided "grocery only" thinking about Kroger, which may own more different regional brands than any other business -- all in the U.S.Notice that Walmart did not begin as a predominantly grocery company, but began a major focus on groceries in the '80s and '90s. This took advantage of the fact that groceries DRIVE RETAIL TRAFFIC, because of the natural fact that people consume food more often than any other thing and, consequently, visit GROCERY stores more often than any other. So Walmart used groceries to drive the rest of their retail business.There is nothing unusual about a grocery business (Fred Meyer in the van, since the 1920s) pushing to integrate higher margin sales in their stores with general merchandise. Incorporating one of the best and earliest practitioners of this into Kroger was a brilliant strategic move.I have recognized for many years that Amazon would move directly into brick-and-mortar retail, which they first did with their book stores. Their acquisition of Whole Foods completed the concept that Walmart used to drive their business to the pole position.The "greasy pole" of retailing is far from fixed, but Kroger may have the right intellectual framework for brick-and-mortar that Amazon has for online. Amazon is ahead of Kroger, but I'm betting on both of them. Never forget that "as long as people live in brick-and-mortar houses, they WILL be shopping in brick-and-mortar stores."Brick-and-mortar (Kroger) has two unbeatable assets -- immediacy (right now!) and the 360 shopping EXPERIENCE. Online (Amazon) has two unbeatable assets -- algorithmic sales and an "infinite" long tail (very ATTRACTIVE).I'm all about bringing online assets INSIDE the brick-and-mortar store. Amazon is already on it (Amazon Go). Brick-and-mortar stores not so much, with their pasted-on online efforts.The game is afoot!
  • Posted on: 10/31/2017

    Is inventory or staffing the biggest omnichannel challenge for stores?

    Both problems predict that retailers will get no greater reward for the millions being spent on BOPIS/BORIS than they had with similar efforts geared to smartphone apps. The reason is that they are trying to compete with Amazon by pasting BOPIS/BORIS onto a system totally NOT designed for it.Never forget that brick-and-mortar retailers are basically merchant warehouseman, relying on unpaid stock-pickers, aka shoppers, to "come and get it!" There is absolutely nothing in their highly refined, carefully honed and highly successful operational plan that is prepared to deal with an Amazonian challenge. Brick-and-mortar retailers' operations and logistics are built on pallets, while Amazon's entire system is built on SINGLE items delivered to SINGLE shoppers.Shoppers do NOT buy categories (what brick-and-mortar retailers manage) but single items (what Amazon sells, and manages).
  • Posted on: 10/30/2017

    What would acquiring Aetna mean for CVS retail?

    What is widely overlooked is that healthcare began to be "socialized" as early as the 1950s, with employer provided medical insurance a growing phenomena. The whole concept of insurance is very socialistic. That is, the entire insured population is a "social" group for the purposes defined by their insurance policies.The medical profession acquiesced readily to this whole phenomena, because as one of my former students, now MD, said, "I don't want anything to do with the money side of the business. I just want to practice medicine." Or something like this.And then the medical licensing boards vigorously supported the cartelization of the practice of medicine by making the practice of medicine anywhere in the country subject to STATE licensing. The insurance companies found this convenient for the cartelization of insurance, also, so that insurance companies could not sell policies across state lines, unless they were so licensed themselves.All the while the money side of health care ballooned, with the government getting more and more involved in its management, given medicare, etc., etc. Now one party has determined that the government MUST be the sole provider -- single payer -- for medical expenses, and hence, health care.So what's the difference between single care provider for health care, and single provider for groceries? Conceptually, there is NO difference, giving some background to Bill Gates bold assertion that "we are all socialists now."THIS is the context of the CVS insurance company acquisition, as well as Amazon's pending move into pharmacy. Never forget that 90+% of CVS profits come from their pharmacy business in the back of the store.The front of the store simply "drives" the pharmacy business. That is, nobody is going to a pharmacy "only" store. Grocery and CPG drives pharmacy, in the same way that grocery has driven Walmart to be the world's largest grocer.And anybody who still thinks Amazon is trapped in an online box is obviously trapped themselves in "the way things have been" is "the way they are going to be" mode. Well, that only characterizes something like 99% of the world. C'est la vie! ;-)
  • Posted on: 10/17/2017

    Should Kroger sell its c-stores?

    Good comment. Actually, I have spent several years thinking about exactly the issues you raise, and claim no perfection in the ultimate answer. But it does look like Amazon is hot on the trail. I'm not an expert in this area, but I do believe that Wawa is maybe the best brick-and-mortar retailer approaching the solution.I've been saying for a couple years that I would like to be able to help an advanced c-store concept to become the first c-store offering 100,000 SKUs from their limited shelves. I have a patent pending ... ;-)
  • Posted on: 10/17/2017

    Should Kroger sell its c-stores?

    I see a number of comments about Kroger's "core business." So how would that line of thought have been useful guidance to Amazon ten years ago? What's their "core business"?The reality is that the core business of Kroger is the final mile of connecting the universe of producers to the universe of consumers. You don't notice a groundswell of condemnation of bricks retailers making blunderous efforts in online selling, for getting out of their "core business."One of the unassailable market assets of bricks retailing is IMMEDIACY, the ability to deliver to the customer what they want RIGHT NOW! Not in two days, two hours, but RIGHT NOW! (There are other core bricks assets, often poorly leveraged.) C-stores are the cutting edge of that core asset.It helps in thinking about all this to recognize that ALL bricks stores are essentially "communal pantries." The size and nature of the "community" varies, as does the stock in the "pantry." "C-stores" are THE WAVE OF THE FUTURE for bricks stores. Notice Amazon's tentative poking into the space with Amazon GO.If you are not careful, all you sharp pencil guys will successfully drive ever larger and larger retailers into bankruptcy. All from a poor understanding of what retailing is REALLY all about.
  • Posted on: 10/16/2017

    Will lessons learned at Amazon Books translate to Whole Foods?

    I have been touting the convergence of online and brick-and-mortar retailing for a number of years now, all the while Amazon keeps building the pieces necessary for this, and the acquisition of Whole Foods looks like we are finally getting the whole enchilada. But then, I was writing about the coming of online retail back in the '80s before the internet was invented. Studying the past, not to be anchored, but to understand the future. The past is a springboard, not an anchor!
  • Posted on: 10/04/2017

    Can retailers be healthcare disruptors?

    Forbes recently published a study of the shifting trends among the 50 largest sectors in American business. In 1917, medical wasn't even on the list, since it constituted less than 2 percent of American industry at that time. Fifty years later, in 1967 medical was the ninth largest industry, while in 2017 it is the third largest.This trend is far from over. And for retailers it is mostly a strange bird that does not fit into their inventory management, unpaid stock-picker shopper business model, because of the necessary professional medical component behind it. So the retail front for medical services is mostly ceded to contract providers, like CVS in Target stores.Since 90+ percent of drug store profits come from fulfillment of prescriptions, with the entire front of the store largely being a traffic builder, adding inoculations and other medical services is at the cutting edge of this discussion.Interestingly, this use of low margin front of store business to drive back of store, or drive-thru, prescriptions, is similar to Walmart using the low margin, frequent sales of grocery to drive sales in the rest of the store, ultimately sending Walmart to the head of the pack of global retailers.Don't be surprised if a related model, using the main body of the retail store as a traffic driver for medical services, has an even larger impact than the injection of online shopping into the brick-and-mortar space. NOTE: medical services will continue to be largely a brick-and-mortar phenomena, as long as medical professionals, doctors, pharmacists and their attendant assistants have the clout to keep non-"professionals" out of the service space here. The future will be more fascinating than the past!
  • Posted on: 09/21/2017

    Are retailers getting comfy with click & collect?

    I don't see click and collect going anywhere significant. 1% or 2% seems about right. The problem is that there is ZERO serious consideration that bricks is built on pallet delivery from the warehouse to the store "warehouse," and unpaid, "free" stock pickers, aka "shoppers" doing the hard final mile work, beginning at MASSIVE store shelves.So how is your store going to compete, by providing a PAID stock picker (store) staff, to fetch and deliver to drive up, when Amazon is relying on robots/automation for the largest part of that process?The fact that the industry is nuts about THIS problem is proven by Walmart's wackadoodle idea to have employees make deliveries to shoppers on their way's home from work. The industry is going to make ZERO progress here until they at least acknowledge what the problem is.

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