Grocery shopping is on the cusp of a digital revolution as electronic shelf labels (ESLs) begin to replace traditional price stickers in stores across the nation. This month, Walmart announced its plan to implement ESLs in 2,300 stores by 2026, joining the ranks of retailers like Whole Foods, Amazon Fresh, and Schnucks, who have already adopted the technology. The switch promises to bring several benefits, including increased productivity, reduced labor costs, and enhanced customer experience.
The adoption of ESLs is not limited to large corporations. Smaller chains can also reap significant benefits from this technology. With labor costs on the rise, ESLs offer a way to optimize staffing by minimizing the manual effort required for price updates. Santiago Gallino, a retail management professor at the University of Pennsylvania’s Wharton School, highlights that the labor savings from incorporating ESLs make them a viable option for retailers of all sizes. This shift towards digital pricing is expected to help maintain consistency between online and in-store prices, reducing customer confusion and frustration.
ESLs enable real-time price changes, allowing retailers to adjust prices quickly based on various factors such as weather conditions or product expiration dates. This dynamic pricing capability mirrors the surge pricing models used by apps like Uber, where prices fluctuate based on demand. However, Walmart’s primary focus on ESLs is not just about changing prices rapidly. The retailer emphasizes improved efficiency, citing increased productivity and reduced walking time for employees, who can now update prices and restock shelves more swiftly.
Beyond price updates, ESLs offer additional features such as detailed product information through barcodes. Shoppers can scan these barcodes with their mobile devices to access information about product sourcing, dietary compatibility, and other relevant details. This added transparency can enhance the shopping experience, providing customers with the information they need to make informed purchasing decisions.
Despite the potential for sudden price increases, experts believe that major retailers like Walmart will prioritize long-term customer relationships over short-term gains from surge pricing. Ensuring price consistency between online and physical stores is likely the main driver behind the adoption of ESLs. This technology allows brick-and-mortar stores to keep pace with the rapidly changing prices of their online counterparts, ultimately benefiting customers by providing a more streamlined and reliable shopping experience.