Retail: Change of Perspective for a Clearer View

23.11.2020 by Pauline Batzer

A woman taps on a smartphone in front of a supermarket shelf.

The Smarter Retail trendbook comes with practical tips, best practice examples and experts’ opinions. Consumer psychologist Dr Paul Marsden, for example, explains how retailers exceed their customers’ expectations.

Digitization is making small progress in retail. A positive trend is apparent, however, in a study entitled Digitization Index SMBs 2019/20. It notes that technologies such as robotics and artificial intelligence (AI) are opening up a wide range of options. Digital checkout systems, smart shelves, WiFi for customers and contactless payment are already in use, but digital transformation is not really gaining momentum in the sector. Many retailers are still reluctant to digitize – and are thereby ignoring their customers’ expectations. That is the conclusion reached in the Smarter Retail trendbook, a joint study by the trend and innovation blog Smarter Service and the consulting company Mind Digital.

Yet digitization pays dividends, or so companies say that have already embarked on digital transformation. With the aid of IoT solutions retail can generate high-quality customer experiences. But to do so, retailers must analyze the expectations of their customers precisely, says consumer psychologist Dr. Paul Marsden, writing in the Smarter Retail trendbook, which is available to download free of charge and contains best practices and fresh insights into the digital transformation of retail trade.

Retail Must Adopt the Consumer Perspective

Companies, Marsden says, must empathize with the consumer. “They must understand the world from the consumer’s perspective. Once they do that, they will recognize the expectations that the consumer has of them.” That, however, is not enough. “Once you have recognized the customer’s expectations you must exceed them to be successful.” Retailers need to try harder to strengthen the autonomy, social connectedness and competence of the customer. “Without psychological expertise not even modern methods like lean startups and design thinking will be much help. In the end all they will have is a wall with lots of multicolored Post-it notes.”

Illustration about customer wishes while shopping

The trendbook’s authors conclude that “It’s no longer ‘Digital First,” it’s ‘Humans First’.” Retail must harmonize its offline and online business, enhance the sustainability of its offering and see digital transformation not as an end in itself but as an enhancement of the customer’s comfort, autonomy and competence.

Digitization: Technologies Like IoT Deliver Important Data

Digital technologies like the Internet of Things (IoT) make systematic collection and evaluation of all interaction with the customers possible by providing data that serves as the basis for decisions. For customers this leads – both online and offline – to a positive shopping experience. In-store, for example, IoT enables the customer to be directed by his smartphone straight to the merchandise he has previously discovered in the online shop. With digital price tags prices can be adjusted flexibly to the customer’s preferences and to the latest market conditions.

In the future long lines at the checkout may also be avoided with the aid of new technologies. “Soon there will no longer be any checkouts,” the trendbook’s authors forecast. “The customer will take what he wants – and leave the store.” Amazon Go is already trialing no-checkout retailing. In the online retailer’s physical stores customers pay automatically as soon as they leave the store with their purchases. As the consumer saves time that might have been spent at the checkout Amazon captures valuable data in the form of customer movement profiles and reachout patterns.

Customized Shopping Experience Thanks to IoT

So retailers should postpone digital transformation no longer because they might otherwise lose customers fast to the competition. Instead, smart solutions on the Internet of Things can help improve processes and eliminate experiences that disturb consumers while they are shopping. Data is the basis on which customers can be offered a high-quality, customized shopping experience. When digitizing, companies must gear the entire enterprise to digital change and should always think from the perspective of their customers.

For further useful practical hints on digital transformation check out the free Smarter Retail trendbook.


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Pauline Batzer
Pauline Batzer

Project Manager IoT

Since 2015, Pauline has been passionate about the variety of the IoT world. She has gained a lot of experience with the Internet of Things from different perspectives by working with customers, partners, and start-up companies. For the Telekom IoT blog she writes about technological trends, products, and innovations in the Internet of Things which are implemented in different industries.