As competition continues to intensify in retail, the emergence of new technologies has led point-of-sale and network managers to explore innovative ways to improve sales, enhance customer experience, and optimize employee and inventory management. One significant development is the introduction of electronic shelf labelling (ESL) solutions, which offer new opportunities for effective growth and customer satisfaction strategies.
ESL systems allow for dynamic price adjustments based on market shifts, competition, seasonality, and other factors. They also facilitate the integration of phygital retail experiences, enabling retailers to incorporate that all-important multichannel shopping experience into their strategies. Digital sales continue to play a key role in retail success, and are expected to account for 20.1% of all global retail sales in 2024 for a total of over $6 trillion.
Today’s retail businesses are focused on creating competitive pricing strategies, reducing costs, and increasing sales effectiveness, all of which can be done with greater ease and flexibility using Electronic Shelf Labels.
What are electronic shelf labels?
Electronic shelf labels, also known as digital price tags, are wireless display labels that are used in retail stores. They are a digital replacement for traditional paper labels that have the advantage of being connected to the store’s main systems, facilitating a great many operations in an environment of phygital retail (the concept of combining physical presence with digital features in retail).
8 Benefits of electronic shelf labels
1. Dynamic and accurate pricing
Before the advent of ESLs, it took retail store staff considerable time to manually update labels every time there was a price change or promotion. This process cost companies dearly, both in terms of labour and in terms of frequently inconsistent or inaccurate prices, in particular when events involved multiple store locations and channels.
Now, companies that use ESLs are able to automate prices and update thousands of labels in a matter of minutes. In addition to drastically reducing lag and errors, stores with electronic shelf labels can take advantage of dynamic pricing —the ability to adjust prices at will based on demand, online competition, inventory and shelf life — and create or pause promotions easily.
2. Better omnichannel experience
As technology advances and online shopping becomes more and more prevalent, customers are starting to expect a similar level of accuracy and access to information when shopping at brick-and-mortar stores. Electronic shelf labels seek to narrow the gap between online and offline shopping by providing NFC and QR codes so that customers can access more product information on their mobile phones. They can also be used to collect data and offer personalized promotions to consumers in-store. As personalized communications and choices continue to shape the future of retail across all channels, ESLs are a vital tool for tracking customer preferences and purchasing behavior.
3. Reduced costs and higher ROI
Digital price tags enable companies to save on both labour and materials. Paper labels involve more expenses than you might think: paper, ink, printers and time, and new labels must be printed every time a change is made. Many stores need to change thousands of prices every week, resulting in an inordinate amount of time spent manually changing each label. This also results in a staggering number of pricing errors.
With ESLs, label price changes that once took staff days or even weeks to complete can now be done in minutes, freeing up associates to work on activities with a higher added value, such as replenishing stock and helping shoppers.
More efficient order picking
Since the pandemic, consumers have become accustomed to new ways to shop. For example, click and collect ordering continues to soar in popularity , and while this can be a new source of revenue for retailers, it also adds a new cost to operations, as pickers need time to go through stores collecting orders.
That’s why Pricer ESL systems from JRTech Solutions include geolocation to help staff locate products and optimize their route through the store. Furthermore, electronic shelf labels are equipped with LED lights that will flash to guide pickers to the correct product. These tools can save up to 10 seconds per pick, which adds up very quickly, as well as improving workflow and job satisfaction.
4. Improved inventory management
The same instantly flashing lights that guide order pickers to products can also help staff restock more efficiently. They can simply scan a product with their PDA (personal digital assistant), and the corresponding label will flash to show them where it goes.
Pricer electronic shelf labels from JRTech Solutions can also help with inventory management, both in-store and in warehouses,by alerting staff to out-of-stock products and providing easy access to information such as the amount of stock that should be in the store, past and planned delivery dates and quantities, products that are approaching expiration, etc. Preventing stock-outs is an important element of retail management that can have a major impact on customer retention, and ESLs can help predict and prepare for sudden and unexpected changes in stock levels and purchasing trends.
5. Enhanced promotions
Electronic shelf labels make promotion management far easier, because prices can be updated automatically as many times as desired. Pricer digital labels are available in four of the most commonly used colours to help promotions stand out to consumers.
No matter what type of retail promotion you are implementing, ESLs are the fastest, most efficient and effective way to update and change prices across multiple store locations.
6. An environmentally friendly pricing system
Electronic labels offer significant environmental benefits over traditional paper labels. The production, distribution, and disposal of paper labels have considerable ecological costs, including deforestation, water and energy consumption, and pollution. Even recycled paper requires resources to process, and not all paper gets recycled.
Electronic labels eliminate the need for paper, reducing consumption and waste, thereby lowering your corporate carbon footprint. This digital solution supports retailers’ sustainability efforts and environmentally responsible practices. Additionally, as customers increasingly value sustainability, adopting electronic labels can enhance a retailer’s reputation and customer appeal.
7. Better customer experience and improved customer satisfaction
Consumer retention and engagement are crucial indicators of customer satisfaction. Improving the in-store customer experience is essential for POS managers, and electronic price displays play a significant role. They provide customers with quick access to product information, pricing, and origin, and help identify promotional items through color coding.
Real-time, accurate pricing information enhances transparency and trust, significantly improving customer satisfaction. Since ESLs dramatically increase the accuracy of in-store pricing displays and can even be adjusted to incorporate real-time personalization strategies, they play a key role in the future of customer experience.
8. Compatibility with IoT solutions and AI
As retailers rely more and more heavily on data to influence decisions about pricing and personalization, AI has emerged as an indispensable tool. Artificial intelligence solutions rely on fast, automated data collection and display systems, such as ESLs.
For example, electronic shelf labels can be equipped with AI-driven dynamic pricing systems that automatically create discounts for products with impending expiration dates. The ESLs can display the discounted price and relevant expiration date in addition to the regular price. The AI will then learn from customer behaviour and adjust the discounts accordingly, maximizing profits and minimizing waste.
By incorporating seamless, automated functions into the retail environment, IoT offers retailers the chance to enhance customer experience and boost profits through improved operational efficiency and store management. IoT retail solutions include real-time inventory tracking, data collection for preventive maintenance, warehouse inventory management and other functions that depend on ESLs for full and effective implementation.
Electronic Shelf Labels FAQs
How do ESLs work?
ESLs receive information from a central database or pricing system via infrared light or radio frequencies. This allows prices and product details to be updated instantly across all labels in one or more connected store locations.
What are the biggest advantages of using ESLs?
Electronic Shelf Labels are becoming the accepted standard in retail pricing management. With ESLs, your business can:
- Update prices automatically and instantly, saving labor costs
- Reduce pricing errors compared to manual paper labels
- Implement dynamic/flexible pricing strategies based on demand
- Display more product info beyond just price (e.g. promotions, stock levels)
- Make your operations more environmentally friendly by eliminating paper label waste
How are ESLs powered?
ESLs consist of small digital devices with e-paper or liquid-crystal displays that operate on battery power. Their low power consumption means that their battery life can last 10 years or more!
Can ESLs be used in refrigerated areas?
Yes, many ESL models are designed to be waterproof and function in refrigerated environments like coolers and freezers.
How secure is the wireless communication to ESLs?
ESL systems use proprietary wireless protocols and encryption to ensure the pricing data is transmitted securely.
Who can manage ESL updates?
Managers can assign user accounts to employees of their choice, thereby effectively controlling who is responsible for updating labels.
What is the cost of an ESL system?
The Return on Investment for an electronic labelling system is typically 12 to 18 months. Electronic shelf label costs will vary based on the specific needs of each retailer and may be influenced by factors such as:
- The number of labels
- The type of label
- The chosen connectivity
- The type of installation
- Integration with a cash management system
- Any specific requirements of the user
Take your store to the next level with JRTech ESL systems
There’s no question that electronic price tags can make all the difference for retailers. With automated price changes, improved team efficiency and access to the information consumers want fast, ESLs can truly bring stores into the modern age and help them remain competitive.
JRTech Solutions is North America’s leading supplier of electronic shelf labels. With over 10 years of experience in digital retail pricing and management and proven technology from industry pioneer Pricer, we are well-equipped to help stores optimize their operational efficiency and keep customers engaged and informed! Contact us today.
