Inside the Mind of the Shopper, 2nd Edition

Much anticipated. 2nd edition.  Pre order it.   By colleague Herb Sorensen  who we used for shopping innovation.   An ideal companion to our new world of advancing analytics in retail.  This connects  science to store behavior in ways that are essential to design, analysis and delivery of retail results.   I am reading and will be excerpting through the year.

Inside the Mind of the Shopper: The Science of Retailing (2nd Edition)
Anticipated on Sep 4, 2016
by Herb Sorensen

" ... What do you really do when you shop? The answers are fascinating and, for retailers, they're cash in the bank. In Inside the Mind of the Shopper: The Science of Retailing, world-renowned retail consultant Dr. Herb Sorensen, Ph.D. uncovers the truth about the retail shopper and rips away the myths and mistakes that lead retailers to miss their greatest opportunities. Every year, says Sorensen, shoppers will spend a quadrillion seconds in supermarkets and they'll waste 80% of that time. 

Sorensen analyzes consumer behavior–how shoppers make buying decisions as they move through supermarkets and other retail stores–and presents powerful, tested strategies for designing more effective stores, improving merchandising, and driving double-digit sales increases. He identifies simple interventions that can have dramatic sales effects, and shows why many common strategies simply don't work. 

You'll learn how to appeal to the "quick trip" shopper; make the most of all three "moments of truth"; understand consumers' powerful in-store migration patterns; improve collaboration between manufacturers and retailers; learn the lessons of Stew Leonard's and other innovators; and much more. Then, in Part II, Sorensen presents revealing interviews with several leading in-store retail experts, including crucial insights on using technology and retailing to multicultural communities.   ... ? 

What Do We Mean by Shopper Journey?

In Retailwire:   Varying definitions.  Suggest you read Herb Sorensen's book, soon to be republished in a second edition: Inside the Mind of the Shopper, about the science of retail. He takes it down to the data involved.

Shopper Scientist: Herb Sorensen

I want to remind people of Herb Sorensen's blog: Shopper Scientist.  He visited our innovation centers a number of times.   One of the most data oriented retail explorers I have ever met.  I hear he may be coming out with an update of his book,  anticipating it, follow him for more information, I will report on it when it comes out.  See my previous writings on his book: Inside the Mind of the Shopper.

Mobile Apps and in-store Impulse Buys

Time in store is the most influential driver for sales.   Well known.  Now can a mobile App keep them in the store longer? And is that extra time also increase buying?

Are mobile apps the key to driving in-store impulse sales?
Not so surprisingly, a university study finds impulse shopping notably increases the longer a customer is in a store. A newsier revelation is that mobile apps may be the way to drive many unplanned purchases.

The authors claim this is the first study to examine changes in impulse shopping as the shopping trip unfolds. About 400 customers carrying handheld scanners at two grocery stores were examined. ....  "

Comments are very thoghtful, see especially Herb Sorensen's thoughts, he has done much work in understanding the science of the shopper and shopping trip.

Hyperlayer for Computer Vision

Just brought to my attention.   I noticed because of the applications to human behavior analysis in retail.  And seeing that Herb Sorensen is an adviser. They include some of his book illustrations at about retail sensing at the site.

" ... Our mission is to enable every computer to see what we see, comprehend as we do, and have the intelligence to alert us in real-time on what’s important.

Hyperlayer was founded in 2013 out of the historic Haseltine Building in Portland, OR. Our team was founded on the idea that the data locked away in images and videos is nearly infinite, and that next-generation devices will be thinking how we think, by seeing what we see. Hyperlayer offers a computer vision and facial recognition API, along with custom services for a wide array of industries, including security, retail, and conservation. ... " 

Views from Our Top Shopper Scientist

 Colleague and correspondent Herb Sorensen writes about the shopper from the view of a scientist.  He helped us formulate some of the key concepts we used in the innovation center.   Extensive and informative article in Shopper Views.  With online retailer Amazon at its center.   Read it!    See also his book and related articles. Abstract:

" ... Selling, logistics and payment are the three principal functions of retailing. In self-service retailing, the mental selling function is largely left up to the shoppers themselves. The mental process shoppers use in serving themselves, whether online or offline ("bricks",) is amazingly similar — and inefficient.

Amazon has learned how to efficiently sell to shoppers in much the same way as personal salesmen of old assisted shoppers in acquiring merchandise, albeit now done algorithmically.
The super-efficient Amazonian selling process can be broken into five steps of moving the mind of the shopper from interest to the close of the sale. Those same five steps can be implemented in bricks stores, with phenomenal success, as has been demonstrated by one global retailer and smaller regional operators.

The advent of smart phone shopping apps (personal sales assistance,) will likely accelerate sales, but not without fixing fundamental flaws that currently impede sales in bricks stores. The driving force of efficiency begun by A&P in the first half of the 20th century, with the baton passed to Walmart in the latter half, is now with Amazon in the first half of the 21st century. However, it is the Amazonian sales principles that will identify the winner(s) of the current struggle for retail dominance. ... " 

Read the whole article.

See also his excellent book.

Turning Shoppers into Heat Maps

A piece in Bloomberg about tracking shoppers in retail.  A subject we did much with in retail laboratory environments, and much has been written about here.  More readily available data visualization capabilities will make this more common and effective.   Startup mentioned is Prism Skylabs. Brought to my attention by Walter Riker.

RFID System Tracks Shopper Flow

In RFID Journal :   Have tested a number of related ideas.  Notably much work by Herb Sorensen's group that was reported in his excellent book : Inside the Mind of the Shopper.  (Image on the right is from his paper) " ... ' Following a 2012 pilot of a radio frequency identification-based solution to temporarily track customers' movements via tagged shopping carts moving through a Toronto supermarket, Moxie Retail is now preparing the solution's installation for two additional pilots with Canadian retailers this year. The technology was developed for Moxie in 2011 by the Academia RFID Centre of Excellence, and was piloted last year for 10 weeks by the Toronto retailer, funded by two consumer-product brand owners. The system has since been installed at another store owned and operated by the same retailer. Later this year, Moxie plans to install the technology to cycle through two stores for another national supermarket chain, as well as at 10 locations for a third retail company. ... " 

Wharton Future of Advertising

Lots of interesting bits here on the topic.  Just brought to my attention by Herb Sorensen.  " ... Since its inception in 2008, the WFoA has become the intellectual hub/lightening rod to spark conversations and collaborations about change and what the future could be. Our goal is to enable collaboration around this topic, provide analytical rigor and co-create thought-provoking and actionable insights for anyone impacting or impacted by the future of advertising, which by 2020 could be all of us on the planet. ... " 

CPG and Eye Tracking

Colleague Herb Sorensen comments on the use of eye tracking by CPG companies in RetailWire.  True,this has become common, and more analytical work is needed. " ... What has become apparent is that visual control, and a whole lot more of the shopping trip, is NOT consciously managed by the shopper, but is under autonomic control. This, in turn, has led me to more in-depth study on the neurobiology behind the guidance/response mechanism, THE fundamental science of the purchase process ... " 

Shopper Marketing

New book: Shopper Marketing: How to Increase Purchase Decisions at the Point of Sale, by Markus Stahlberg.    On my list to read.   Contains a chapter by Herb Sorensen regarding his Atlas store category simulation system that we examined when it first came out.     " ... Shopper Marketing explores the subject of focused marketing initiatives aimed at browsers and shoppers who are in-store and can be influenced in their final buying decisions. Now with a new foreword by Philip Kotler this second edition features 12 brand new articles that reflect the current changes in the fast growing area, focusing specifically on the international scope, the online presence and the future of shopper marketing.   Written by 35 experts from top companies around the world including dunnhumbyUSA, Millward Brown, Tesco’s Fresh & Easy, MARS Advertising, Nestlé and author, CEO and president of Envirosell, Paco Underhilll, Shopper Marketing shows the most effective ways of converting shoppers into buyers at the point of purchase. ... " 

Atlas Category Placement Tool

I have mentioned Herb Sorensen's Atlas Category placement simulation tool a number of times.  It has now moved to a  new  location.  More about it here, and more background information.

Atlas
The Category Placement ToolTM

Can I improve my profits if I move baby food from aisle 6 to aisle 15?
Atlas is the first system that allows retailers and brand managers to instantly calculate the revenue impact of moving categories anywhere in the store...." 

Selling: Query Time and Choices

Via correspondent Herb Sorensen:  Closing the sale,  query time and choices:

" ... Among the teachings of Joe Girard, identified by The Guinness Book of World Records as "The World's Greatest Salesman," are focusing on the customers' time and their choices — both of which are regularly ignored by today's retail staffs....  "

Building It and Getting the Shopper to Buy

Herb Sorensen, well known retail scientist publishes an interesting article in Views: If you build it, they will NOT come!   An evidence-based quantitative view of how shopping works.  Highly recommended.

"It helps to think about retailing, beginning with its basic elements. The driving force behind it is the needs and wants of people. Other people have produced those needs and wants, and it is a matter of getting the stuff together with the people who want and need it. Of course a driving force behind the small store movement is the effort on the part of retailers to get the stuff closer to where the people are, rather than having it in huge stores, where shoppers may have to travel some distance to get access to their needs and desires. But there are other important factors here, relating to what happens once the shopper gets to the store and goes inside. ....  "

Sell to Their Shopping Lists

Good piece from Herb Sorensen's Views site.  Read the whole thing.

Sell to Their "Shopping Lists" (Tell'em Which to Buy!)
December 20, 2010 - by Herb Sorensen, Ph.D., Scientific Advisor, TNS Retail and Shopper

This issue of the Views provides further insight on how and why you can use the dominant path through the store to increase sales. Ten years ago I articulated "The Holy Grail of Retailing:"

To know exactly what each shopper wants, or may buy, as they come through the door of the store, and...   To deliver that to them right away, taking their money and speeding them on their way.

So we want to focus here first on "what each shopper wants, or may buy," and will use an expanded view/definition of the "shopping list" to encompass exactly this – what the shopper wants or may buy. It is a mistake to limit this "shopping list" to a piece of paper or other overt evidence of a shopping plan. In fact, with a better understanding of the role of habit (or the subconscious mind) in shopping, the "wants or may" abbreviates what Neale Martin refers to as the executive mind (wants) or habitual mind (may.) (See Neale Martin, Habit: The 95% of Behavior Marketers Ignore.) ... "

Inside the Mind of the Shopper

I have had a chance to re-examine Herb Sorensen's book from last year, and his supporting site that contains articles about some of the concepts included. Also, a number of posts in this blog about the concepts in the book.  And you can order his excellent book there as well:

Inside the Mind of the Shopper 
In his new book, Herb Sorensen challenges the conventional wisdom of retailers and brands who don't understand how shoppers actually buy. A few highlights:

- Sell more by promoting a select group of products, rather than frustrating them with too many choices.
- Merchandise for the "quick trips," which comprise most shopping trips and a third of total dollar sales.
- Understand the buying hot spots, reach more shoppers and sell more items.

Tell Them Where to Go in Retail

Click through to see the whole thing:

Tell 'em Where to Go; Tell 'em Which to Buy!
(The "Path-to-Purchase" Ought to Be a U-Turn)
September 30, 2010 - by Herb Sorensen, Ph.D., Scientific Advisor, TNS Retail and Shopper

The objective facts are that there are a few retailers who obtain outsize sales and profits in comparison to other stores carrying similar merchandise. Because these few have some obvious differences from the thousand-store chains, many retailers ignore the underlying principles that drive the outsize success of these super performers. Here it is my intention to explain the relevance of these super performers to all retailers, and how to leverage the principles that drive their success, without upending your own operations. That is, where they may be selling five times as much (500% more sales than you,) you don't have to go the whole way with their business and merchandising strategy to maybe get a 50% increase in sales yourself ... "

Stop Customer Price Fixation

Herb Sorensen pointed us to a paper on how to avoid customer price fixation in the May Harvard Business Review. Good examples and good read, and also read the comments which have some good points.

Supermarket Space Allocation

In Progressive Grocer: An old problem that we started to look at in terms of optimization starting in the 70s. In recent years increased computing power and better models have started to construct revenue management models to address not only how much space gets allocated, but also precisely where things are best placed. Most importantly, the specific and generalizable behavior of consumers has been explored in much detail by Herb Sorensen and others. Much more about that in posts here. Mixing the two criteria seems an obvious thing to do.

Atlas Category Management

More on TNS's Atlas Category simulation tool. Unique in its ability to predict the results of key merchandising decisions. I have discussed Atlas here a number of times.

' ... This report introduces Atlas, a model that accurately describes shopper behavior across a series of supermarkets in terms of traffic across the store, share of shopping at various locations, resulting purchases, and the amount of time shoppers invest in these activities. The value of the tool to measure the in-store “audience” for advertisers is assessed as is its utility for allowing store management to evaluate a wide range of “what if” movements of categories to alternate locations, with alternate display sizes. This report focuses on center-of-store aisles but points the way to deployment for the full store, including end-caps and perimeter displays.' ... Via Herb Sorensen of TNS and Jacob Suher of Wharton