Retailers are increasingly adopting electronic shelf labels (ESLs) to streamline shelf management and provide customers with improved shopping experiences. ESLs replace traditional paper price tags with digital displays that can be updated remotely in real-time.
A electronic shelf label consists of an electronic display, usually an e-paper or LCD display, attached to a shelf. The displays are connected wirelessly to a central network that allows for remote updating of prices and product information. ESLs eliminate the need for staff to manually update shelf tags, enabling rapid price and information changes across entire store networks.
Benefits of ESLs for Retailers
ESLs provide numerous operational benefits for retailers compared to paper shelf labels:
Faster Price Changes: With traditional labels, changing even a single price point requires staff to visit every shelf. ESLs allow for centralized and near-instantaneous updates of all relevant shelf tags from any location. This enables dynamic pricing strategies and rapid responses to promotions or inventory changes.
Reduced Labor Costs: The manual labor of printing and replacing shelf tags is eliminated. Retailers save significantly on labor costs associated with tag replacements and audit processes. Studies show ESL deployments can reduce these operational costs by 30-50%.
Improved Inventory Management: ESLs can be integrated with inventory management systems. Out of stock alerts can instantly update relevant shelf tags, guiding customers to alternative products or locations. Dynamic updates also allow perfect promotional execution down to the store level.
Analytics & Insights: ESL systems capture in-store behavior data through analytics of purchase patterns, dwell times, and abandoned carts. This delivers invaluable customer insights to optimize merchandising, planograms and assortments on a store-by-store basis.
Benefits of ESLs for Customers
Customers also gain useful advantages from Electronic Shelf Labels:
Dynamic Pricing Transparency: Customers see accurate and up-to-date pricing information on shelves without uncertainty over manual label errors. This builds trust in the shopping experience.
Personalized Deals & Recommendations: ESL systems can recognize customers through loyalty programs or device IDs. Stores gain capabilities to deliver personalized, location-based deals and recommendations right on the shelf edge.
Queue Reduction: Faster restocking and inventory management through ESLs means fewer out of stocks and less time wasted searching empty shelves by customers. Checkout queues are reduced.
Modern Shopping Experience: Customers appreciate the benefits of digital innovation. ESLs have been found to increase satisfaction scores with a store's perceived technological sophistication and ease of shopping.
ESL Systems & Deployment
Leading ESL system providers include Pricer, SES-imagotag, Displaydata, Altierre, T-Ink and Hanshow. Systems essentially consist of three core components:
- ESL Display Units: These attach directly onto shelves and contain the electronic display, processor and wireless connectivity. Battery life typically ranges from 3-5 years.
- Central Software Platform: Cloud-based platform manages the entire ESL network, scheduling price/content updates and integrating with other retail systems.
- Infrastructure: An indoor localization system autonomously associates each ESL with its physical location. Additionally, server infrastructure supports wireless communications across large store networks.
Full-store ESL deployments usually happen in phases, beginning with high inventory turnover categories before scaling to entire stores and multiple locations. Total store conversion times average 6-12 months depending on scale. Cost of ownership averages $3-5 per ESL display unit annually over 5-7 years.
The Future of ESLs - Enhanced Experiences
While the efficiency and accuracy benefits of ESLs are already compelling for retailers, the future potential goes far beyond simple price updating. As networks become more sophisticated:
ESLs will enable interactive screens delivering immersive product information, dynamic nutrition facts, reviews and recommendations.
Location services on customers' devices can trigger customized messages and deals tailored to their shopping path, browsing history and personal preferences.
Computer vision and sensor fusion with ESLs may allow for analytics of dwell times, engagement, customer flows without invasive design changes to stores.
Integration with AI-powered shopper monitoring, online order capabilities and automated replenishment promises a fully optimized omni-channel shopping experience.
As technology evolves, ESLs are set to revolutionize the engagement models between retailers, brands and consumers inside physical stores. Their deployment represents a major digital transformation underway across the global retail sector.
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