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: 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.
  • Posted on: 09/15/2017

    Kitchen 1883 may be a new platform for Kroger’s growth

    EXCELLENT idea! Terribly limited time schedule -- hours open.
  • Posted on: 09/13/2017

    Survey says grocery has reached its digital tipping point

    Are you kidding me? The "digital tipping point" happened at least five years ago, if not 10 or more years ago. People are paying Amazon drop-outs hundreds of billions of dollars to help them "digitize" their retail sales. And the entire commentariat steadfastly refuses to address the reality that Amazon has built/is building a DIGITAL, single-item DELIVERY system, to the shopper? Meanwhile, brick-and-mortar is considering using employees to deliver to their shoppers, on their employees' ways home from their brick-and-mortar jobs: THERE IS MASSIVE WHISTLING IN THE DARK!
  • Posted on: 08/24/2017

    Will Amazon become a dominant force in grocery after acquiring Whole Foods?

    YES. Good grief! Food drives global retail, period. It creates traffic for anything else a retailer might sell. It is THE single factor that drove Walmart to its number one position, beginning in the '80s.
  • Posted on: 08/21/2017

    Why are Target’s small stores much more productive than its big boxes?

    It is a fiction that these giant rat maze warehouse "stores" are built to serve the shopper. They are built to serve the supply chain but retail is, after all, an industry accustomed to lying to itself about why it does this or that. Actually, there is nothing wrong with building stores to serve the supply chain, as long as the unpaid stock-pickers (shoppers) don't mind. Many retailers remind me of the little boy swinging a rope around and hitting his little sister and telling his mother, "But she LIKES it!"Given the same size giant store with only 4,000 items in it, sales will be several times greater. Check Costco with 4,000 SKUs in comparison to Walmart with 100,000+ SKUs. The bottom line is: The Problem: "Parked" Capital.
  • Posted on: 08/02/2017

    Are there too many grocery stores?

    The entire perspective BEGINS with Ed Rosenbaum's final note (below): "We do have to eat." The detail, I have spelled out at www.ShopperScientist.com, and with my second edition of, "Inside the Mind of the Shopper," particularly the first six chapters.Very briefly, retailers are merchant warehousemen, who are focused on a pallet-based supply chain. They get the merchandise onto the shelves of their neighborhood warehouses (aka, stores,) and rely on unpaid stock pickers (aka, shoppers,) to "come and get it!" They neither know nor care how the shoppers do this, they only tally the items and dollars at checkout, and the square feet of the store. The rest is "crowd" demographics, etc.Meanwhile, retailers have ZERO interest in maximizing the sales of ANY supplier. They want multiple suppliers competing for their warehouse space, which creates the "brand-on-brand" mayhem that goes on in the aisle, and from which the retailer draws their #1 source of profits, which is in reality, a cut from the suppliers' profits -- slotting fees, trading allowances, etc.The radical difference between this and Amazon is NOT that one is bricks, and the other is online. It is one that is intensely focussed on individual items, one at a time, and individual shoppers, one at a time. Paying $300 billion dollars to overlay an online, formerly unremarkable acquisition, onto their shopper dysfunctional stores is doing close to ZERO to solve the nut kernel problem. Writ large or small, the reality is the same.
  • Posted on: 08/02/2017

    Are there too many grocery stores?

    NO! There are not "too many grocery stores." But the stores that there are, are designed to accommodate suppliers and retailers -- NOT shoppers. It is NOT online that is assaulting brick-and-mortar retailers, it is someone aggressively dedicated to the shoppers.The story has way too many facets to treat here, but mostly the recognition of the "Houston, we have a problem!" variety is all we hear. WHAT the problem is, is largely unrecognized. If it was "too many stores," why are the new players, INCLUDING AMAZON, building NEW brick-and-mortar stores? What is needed is brain transplants all around. And this is only a nudge: The Problem: "Parked" Capital -- September 30, 2014.
  • Posted on: 07/20/2017

    Is the one-stop grocery shop coming to an end?

    It has always been true, in all societies, and from antiquity, that grocery stores have functioned as "communal pantries." For a variety of reasons, the process of moving groceries from the communal pantry to your own private pantry at home or office has varied as store access, personal finance and lifestyles have evolved.One HUGE factor is the move toward food service (restaurants, etc.) I don't know the exact figure currently, but I'm pretty sure that, in the U.S. market at least, more than half of the food dollar goes into food service rather than for movement to a pantry for later use/consumption. This also points out why the best stores provide both groceries AND food service. Notice the large, and sometimes crowded, in-store "dining" area at Costco.Never forget that FOOD drives retail, because FOOD drives the human race. Air, water and food are the ONLY things that humans MUST consume on a continuing basis. Air every few seconds, water (beverages) at least every few hours and food every day. To be extreme, you will die in a minute or two without air, a few days without water and a few weeks without food.Retail is the final mile in how those who produce food and beverages support those of us who don't. Grocery marketing drives TRAFFIC and led Walmart to become the largest retailer in the world. And when there is a new world leader, FOOD will be their major tool for getting there. Food is the big head of retail. It is also the driving engine pulling the long tail along.
  • Posted on: 07/18/2017

    Is online fulfillment from stores too complex for e-grocery?

    The fulfillment problem is just the ignored tip of the iceberg. The entire brick-and-mortar system is built on PALLET logistics, delivering pallets of merchandise assembled in warehouses to stores where paid stockers put the stuff on shelves. Amazon's entire logistics is built on ITEM delivery to individual shoppers, not to stores.The brick-and-mortar retailer's entire model is heavily dependent on UNPAID STOCKPICKERS, aka shoppers, to do that final "picking" and taking it to checkout for purchase. This is why I refer to brick-and-mortar retailers as merchant warehousemen. They do not SELL anything to anyone. They simply keep the WAREHOUSE, aka store, stocked, and other than stocking and COUNTING the money and sales, they are fairly ignorant of the actual mental/physical PROCESS by which shoppers sell to themselves.It's too complicated! ;-)
  • Posted on: 06/22/2017

    Does Costco need to significantly undercut Amazon’s prices?

    In terms of actually closing sales to shoppers, Costco uses methodology that is amazingly similar to that of Amazon. In fact, Costco was exhibit A in my 2013 report on "Selling Like Amazon... in Bricks & Mortar Stores!" But there is another vital similarity: Costco's MEMBERSHIP and Amazon's PRIME. Both of these provide a bedrock of pure profit, allowing both companies to pursue the 100-year-old retailer strategy of as close to ZERO margins as possible. See: "The Great A&P and the Struggle for Small Business in America" by Marc Levinson.A year ago, Costco was the number two global retailer but now has been passed by Amazon. The future belongs to Amazon because their business model is more easily scaled than is ANY brick-and-mortar retailer. But at least Costco's more plodding growth is built on a solid SHOPPER based business plan, as contrasted with other brick-and-mortar retailers' SUPPLIER-based business plans. As The Wall Street Journal recently quoted in READER RESPONSE:"Herb Sorensen of Oregon shared: 'Brick-and-mortar store logistics are designed to deliver pallets to their own ‘neighborhood warehouses,’ a.k.a. stores. Amazon’s logistics are built from the ground up, to deliver items to individual shoppers. Fresh food is, of course, a challenge for Amazon. But Amazon can, and likely will, solve this problem, and become the world’s dominant retailer, just as Wal-Mart did when they moved seriously into fresh food in the 80s and 90s.'"
  • Posted on: 06/16/2017

    What happens now that Amazon is acquiring Whole Foods?

    Two things: Amazon Go, and "As long as people live in brick-and-mortar houses, they WILL be shopping in brick-and-mortar stores."I have written extensively on this subject since at least 2005, when I did a presentation on "The Amazonification of Walmart." Unfortunately, Walmart never caught on. And then with "Selling Like Amazon... in Bricks & Mortar Stores!" I pointed out the incredible operational (relative to shoppers) similarity between Costco and Amazon.Last year, a senior manager at Costco announced that they were not going to make a major focus of their online operations, and then in the past few months the message was reversed and they ARE going to make a major focus on integrating their online AND brick-and-mortar operations.It is still early times in the total revamp of brick-and-mortar retailing and the INTEGRATION of bricks with clicks. It looks like the cutting edge of that integration is now pretty well in the hands of Amazon. At least they are working on the REAL problems: "rat maze" stores with massive "parked capital."Our merchant warehousemen (brick-and-mortar retailers) relying on unpaid stock pickers (shoppers) have spent a century relying on their suppliers to generously fund those massive stores, with massive near-static inventory -- relying on a tiny slice of that (The BIG head) poorly focused-on, as the outlet for a logistics system built on pallet movement through the supply chain. Amazon's system is built on ITEM movement -- and the winner is?The game is long afoot, but far from over.

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