PRICE CHECK: How electronic shelf labels can improve efficiency—while enhancing the customer experience

These days everything is going digital. More and more shoppers are going online, even when making everyday purchases like groceries for the week. With this in mind, retailers are looking for ways to enhance the in-store experience by adding digital elements. Converting to electronic shelf labels is a seemingly small change grocers can make, but one that has a surprisingly big impact on the bottom line, customer experience and employee morale.

Benefits for the grocer

Grocers realize an immediate cost savings when switching from paper labels to electronic shelf labels. Not only is there savings from reduced materials cost—no more sheets of paper labels and expensive toner cartridges—but there is a substantial savings from reduced labor costs. With traditional shelf labels, employees would have to update the labels and move through the store removing old price tags and applying the new ones. And don’t forget the overtime costs due to interruptions, distractions and after hours work that may be needed.

With electronic shelf labels, all of these changes can be managed from the back office or a corporate or regional headquarters and rolled out simultaneously across all stores. What used to take hours now only takes minutes, freeing employees up to focus more on customer service or other store activities.

From the time saved through the digital labels, staff can redirect their attention to developing in-store signage for upcoming promotions or events. They can spend time on price shopping by checking competitors’ ads, and if a price change is needed it can be rolled out almost instantly. Employees can even use the time saved to work on community outreach projects for the store.

Impact on the customer

These changes have a notable impact on the customer. The cost savings grocers achieve from electronic shelf labels can be passed on to the customer directly, or they can be used to enhance the customer experience in other ways. Staff can focus more on helping shoppers find the items they need. Customers can also find the things they’re looking for more easily—because of the new labels.

Digital labels allow retailers to include small graphics or icons that can help shoppers easily identify the products they prefer to purchase. When paired with a shopping guide or in-store signage, electronic labels can help designate which products are heart-healthy, organic or non-GMO. And as the farm-to-table movement continues, the signs can display which products are sourced locally. All of these small touches add up, helping grocers stand out and giving customers a reason to continue coming back.

Achieving a return on investment

Beyond the cost savings and improvement of the customer experience, electronic shelf labels can actually boost employee morale. While employees may initially be hesitant to embrace the change, thinking it could leave them without a job, they quickly realize that it means they’ll be given even greater responsibility and can take on more meaningful roles within the store. It also means they’re no longer tasked with the tedious task of manually changing the shelf labels.

This is important to note, since the initial cost of upgrading to the new retail technology can be difficult to justify—you need the assurance of a relatively quick return on your investment.

The good news is, because of the many cost savings areas these touch, electronic shelf labels can typically pay for themselves within a year depending on the size of the project. Even so, it might be best to consider a gradual rollout of the electronic labels by installing them where you’ll see the most immediate value, such as the deli counter. Electronic shelf labels can help reduce margin loss from shrinkage by enabling dynamic pricing of perishable food.

If you’re making hot deli products or have something that's going to expire, you can change the price through the electronic shelf labels on the fly. At the start of the day an item could be priced at $9.99. As the day goes on and the need to move the item increases, the price can be reduced to $8.99 or $7.99. According to a recent report by Planet Retail and Display Data, nearly two thirds (65%) of consumers would welcome these kind of price changes throughout the day. This same approach could be applied to the meat department and even produce.

Whether you’re considering electronic shelf labels for a single department or the entire store, the benefits are sure to outweigh the costs.

Looking for a partner who can help you with the upgrade? TRUNO can help with purchasing, installation and integration into your back-office systems. 

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