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: 10/08/2018

    Giant Food expects big things from a new, mini-grocery store concept

    This new Giant store IS "the store of the future." "Giant" retailers like Walmart, and everybody else, absolutely refuse to recognize that their cavernous stores are actually neighborhood pantries. The hard facts are that more shoppers walk out of a Walmart Supercenter with just TWO items than any other basket size. Three and ONE are the next most common basket sizes at Walmart. (For supermarkets, ONE ITEM baskets are the most common!) However, as to their "endless aisle" technology, staff with tablets hardly seems serious. But at least it is an overt response to providing access to the other tens of thousands of items that make little sense in the "neighborhood pantry." I'm betting on my patent pending "Long Tail Accelerator!" (20160247219 - INTERACTIVE TRANSACTION SYSTEM FOR PHYSICAL MERCHANT STORES. ;-) )
  • Posted on: 10/02/2018

    Why do retailers practically ignore existing customers to go after new ones?

    "Legacy systems are focused on sales transactions, not customers...." This single, simple statement, summarizes a VAST unrecognized truth. If only bricks retailers would understand that the assault of Amazon on their core business, is driven by Amazon's focus on customers, not products. Amazon doesn't give a fig about the products, of the millions they have on offer. All they want is THE sale, ANY sale, RIGHT NOW! Did you notice their "1-Click" ordering? For Amazon, everything is now, Now, NOW! To confuse the issue by the incredibly superficial thinking of online vs. bricks is just that, incredibly superficial. And is leading to billions in investment that is totally missing the Amazon target, as they continue munch, Munch, MUNCHING on everyone else's lunch, in their frenetic/leisurely fashion. Wake up, Wake Up, WAKE UP!!! ;-)
  • Posted on: 09/27/2018

    Will Amazon disrupt retail again with its new 4-star store concept?

    This is a perfect formula for ANY brick-and-mortar store. Do you think that 100 years of bricks success will forestall anything but cosmetic responses, like "click and collect?" Note: "How Failure Spawns Success; (in retail, as well as elsewhere)." But most businesses fail so that OTHER businesses can succeed. Sad.
  • Posted on: 09/24/2018

    Are big box retailers going too small with new store concepts?

    Two hard scientific facts drive the advisability of smaller stores:
    1. In nearly ALL stores, shoppers make a ONE-item purchase more often than any other number. (For Walmart, it is TWO items as the most frequent basket size.)
    2. For a supermarket with 40,000 items on display, 400 of those items deliver one-third of total store sales (1,000 items deliver 40 percent of sales -- with contribution per additional inventory items plummeting).
    But for suppliers, every additional item helps buttress their own battle for shelf space -- and possible shopper attention. And suppliers pay for that competitive space one way or another. The one- or two-item purchases just confirm that stores have become neighborhood "pantries!" No need to have a fully stocked pantry at home when you pass several stores every day, where you can pop in to get your IMMEDIATE needs. Add in online and you have potentially infinite selection! THIS is where retail is, and is going in an even more extreme form. Get your popcorn and watch! ;-)
  • Posted on: 09/14/2018

    Are ad agencies history?

    Are ad agencies history? If "ad agencies" means "what they have been up until now," then the answer to the question is YES. But the same question can be asked about a lot of businesses, and for many, the only helpful prescription is "change or die!" One relatively comprehensive (and very detailed) view of what is driving the BIG change can be found in "Life After Google: The Fall of Big Data and the Rise of the Blockchain Economy" by George Gilder. But there are a torrent of articles of the type being discussed here that are swelling into the commercial space.
  • Posted on: 09/04/2018

    Walmart’s two-day shipping pledge comes with a caveat

    Calling it "Out of Stock" is simply lying to the customer. I see Walmart inherited this dishonesty from Jet.com.
  • Posted on: 08/21/2018

    How much do e-tail algorithms need humans?

    The two "unassailable" advantages of online selling are the "infinite" long tail -- the "everything store" -- and algorithmic selling. (The advantages of brick-and-mortar are immediacy and the 360 experience.) Not surprisingly, as Amazon moved into brick-and-mortar, they began by trying to apply their algorithmic genius into their brick-and-mortar stores. As others have noted here, their beginning algorithmic approach was less than totally satisfactory. But Amazon is inherently a LEARNING organization -- as contrasted with the 100-year-old brick-and-mortar logistics selling model. The industry has yet to come to grips with the loss of "active selling" skills 100 years ago. The new passive selling, aka SELF service was such a massive success, delivering billions in profits for retailers, and MASSIVE attendant benefits for shoppers, the original self-service mantra became deeply embedded into the industry’s psyche — "Pile it high; and let it fly!" So much that the personal selling skills associated with salesmen were ignored, with the non-personal selling of a brick-and-mortar store, what I call PASSIVE selling, becoming mistakenly thought of as "selling." With the advent of Amazon, the industry was faced with a genuine approximation of ACTIVE selling, embedded in Amazon's algorithmic selling. (Remember, true selling is always about something that happens in the mind of the shopper. See: Selling Like Amazon... in Bricks & Mortar Stores! - October 25, 2013. THIS is the true challenge of clicks for bricks! Thinking that pasting online operations onto a massive brick-and-mortar passive selling operation is an adequate response to Amazon is incredibly superficial. Adopting long vanished (gone 100 years) personal selling techniques within the brick-and-mortar store apparently is not going to gain major traction until Amazon works out their bugs and continues their voracious growth -- they've hardly yet begun! ;-)
  • Posted on: 04/23/2018

    Apocalypse? No. Retail faces a reset

    Someone is always thriving. Their particular business model may not appeal to you. But you needn't be recognized as a great tech innovator in order to survive. Look at the literally multi-decade puny success of hand-held devices at retail. But clinging to 100-year-old successful thinking is NO guarantee of survival, either. I respect those who introduce transformative technology -- IF it IS transformative to the shopping crowd. Alexander Pope left us some sage advice: "Be not the first, by whom the new is tried. Nor yet the last, by whom the old is laid aside." Focusing on the Big Head (what people mostly buy) without burying it in the Long Tail (what they might want to buy, sometime) has been a winning strategy from time immemorial. Probably will be, going forward, too! (See my article on "Crowd-Social-Nudge" Selling.)
  • Posted on: 04/18/2018

    Best Buy and Amazon expand their coopetition

    This will guarantee the survival of Best Buy, just as Whole Foods is now guaranteed survival -- not that either of these two chains were in imminent danger from the "grim reaper." But it also means another shot in the arm for Amazon.
  • Posted on: 04/17/2018

    Meijer works to keep up with Kroger and Walmart with ‘Shop & Scan’ tech

    This is one step short of Amazon Go, which doesn't require shoppers to scan anything -- the Amazon Go app does it for them. The real, unrecognized problem here, is that self-service retail, for the past 100 years, has basically been a warehouse business, with the retailer stocking their neighborhood "warehouses," aka "stores," with PALLETS of merchandise. The "stock pickers," aka "shoppers," then select from this massive in-store offering, and take it to checkout. The real problem for bricks retailers is that they refuse to recognize that they are pasting thin solutions on what is in reality a pallet vs. item distribution and management system. (Pallets for them; items for Amazon.) Pasting Jet onto Walmart was a multi-billion dollar example of this less than insightful response to Amazon. And the false dream of smart phones standing in for what shoppers by the billions already instinctively do in stores, is equally less than insightful. Shoppers do NOT habitually use inadequate personal devices -- smart phones -- to expedite their habitual practices in stores. Good grief! ;-)
  • Posted on: 04/12/2018

    Is product discovery now the biggest pain point for mobile buys?

    Good points. I have said before that bricks has 2 unassailable advantages -- the 360 experience in the store; and immediacy of getting what you are buying, not at some time even soon, but RIGHT NOW, in your hand. But then online has 2 unassailable advantages -- the infinite LONG TAIL; an algorithmic SELLING process. See: Selling Like Amazon... in Bricks & Mortar Stores! I say "unassailable advantages," but online's algorithmic selling is only unassailable because bricks don't even understand the problem they are up against. We'll see lots more bankruptcies, and costly thrashing about, BECAUSE the 100 year old mindset that has served so well for so long, calls for something more than costly tweaking.
  • Posted on: 04/12/2018

    Is product discovery now the biggest pain point for mobile buys?

    The reality is that smartphones will NEVER play a significant role (more than a few percentage points) in the FMCG/CPG space. Nowhere is Neale Martin's sage observation from "Habit: The 95% of Behavior Marketers Ignore" more appropriate. It has been reported that Clive Humby commented on the deployment of kiosks in supermarkets, "It won't work. It's not CUSTOMARY to the shoppers." That hasn't kept hundreds of millions from being wasted since the turn of the century in getting hand-held devices to be the Holy Grail. They are not, and are unlikely to be in our life-times, if ever. But there ARE niches! ;-)
  • Posted on: 04/02/2018

    What would an acquisition of Humana mean for Walmart and its rivals?

    For the past 100 years, major moves at retail have been about TRAFFIC, and building profits on that traffic other than selling customers things. There are three things that build traffic -- water, food and, now with the aging population, healthcare. To understand the serious nature of traffic as a root driver of retail, bear in mind that more than 90 percent of CVS' profits comes from the prescriptions in the back of the store -- and that drive-through. The front of the store must carry its own weight but, in reality, the front is a traffic builder for the back. There is nothing strange about this. In the same way, when Walmart was topping out with their large general merchandise stores in the '80s, they moved to supercenters with full groceries and that move, nearly alone, drove Walmart to become the half-trillion dollar behemoth they are today. But today it is not just food and beverage that is driving growth, it is healthcare for an aging population and, even more specifically, THE FUNDING OF THAT HEALTHCARE, aka health INSURANCE, where the real money in healthcare lies. CVS, with their in-store "clinics" and move into health insurance was THE early player in this swelling PROFIT game. The forced cartelization of the healthcare insurance market, virtually forbidding the sale of that insurance freely across state lines, will probably keep mega-capitalism in control of U.S. healthcare. These moves by major retailers into control of rich profits from the insurance business will result in the "nationalization" of national health care, without the stultifying dictatorial control of government. Abolish state lines that have forced the cartelization of insurance and competition will do its job. BTW, on that traffic business, even in Walmart, more shoppers leave the store with only a single-item purchase, with two being the second most common purchase size. Quick trips are the hugely valuable and unrecognized driver of food/beverage (and many other) purchases. What on earth could Kroger have been thinking when they backed out of the quick trip, c-store business?
  • Posted on: 03/30/2018

    Former Walmart U.S. CEO raises prospect of breaking up Amazon

    We went through this 100 years ago, as seen in "The Great A&P and the Struggle for Small Business in America" by Marc Levinson. Ironic that a former Walmart executive is making the competitive complaint. And it is significant that it is recognized that Amazon can afford to sell at or near ZERO MARGINS because of growing and massive funding from their Amazon Web Services (AWS). So Walmart plays nearly the exact same game, squeezing out their smaller competitors -- and attempting to compete with Amazon -- by relying on what are essentially ADVERTISING services. It's of course true that Walmart delivers the goods to shoppers, but their PROFITS come from "selling" shelf space (and location) to their suppliers, along with "advertising," whether in-store or with Walmart's broader advertising. There is nothing nefarious about using supplier payments for profits and driving for the lowest possible margins -- just adequate to cover operations, and maybe a few percent. What is weird is that most of the world thinks Walmart makes their profits selling things other than advertising. Google and Facebook are eating Walmart's "advertising" revenue. As is Amazon. So print, radio and TV played the same role 100 years ago, with A&P and the early supermarketers. Access to shoppers' eyeballs and minds are not controlled by walls anymore. RETHINK!
  • Posted on: 03/16/2018

    Survey says ‘retail is retail’ no matter where the sale is made

    "In fact, there will be a continuing Convergence of Online, Mobile and Bricks-and-mortar retailing (COMB retailing)." Apr 10, 2012 Glad to see the subject being addressed finally here. I look forward eagerly to a discussion of bricks retail being built on pallets, while online is built on items (logistics.) It's been a year or two since I first brought up this totally ignored, but controlling reality for bricks vs. clicks.

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