Understanding Electronic Shelf Labels

As more retailers adopt electronic shelf label technology, its advantages have become increasingly apparent. Electronic shelf labels offer significant labor savings and operational efficiency to retailers. This article delves into the technology and principles behind electronic shelf labels and analyzes their impact on store operations.

I. The Technology and Principles of Electronic Shelf Labels

E-paper and E-ink Technology
The core of most electronic shelf label systems is e-paper technology, a display technology that does not require backlighting to display information. Unlike LED or LCD screens, e-paper reflects ambient light, making it easy to read under various lighting conditions, which is ideal for busy retail environments.

The unique advantage of e-paper lies in its low energy consumption. The screen only consumes power during updates, and once the display is set, the image remains static without additional power consumption. For electronic shelf label systems operating in large retail chains, this durability and energy efficiency are critical.

IoT Integration for Real-Time Updates
Electronic shelf labels rely on IoT (Internet of Things) integration to enable fast price updates and data synchronization. By connecting each label to a central database, IoT allows stores to manage pricing and inventory information in real time. Platforms such as AWS IoT Core and Microsoft Azure IoT Hub provide secure and efficient management of electronic shelf label networks across multiple locations.

Through IoT, retailers can quickly adjust prices on thousands of products to respond to inventory changes, promotional campaigns, or demand fluctuations. This not only saves labor but also enhances accuracy and consistency, which is crucial for retailers managing a vast number of SKUs.

II. Operational Impact of Electronic Shelf Labels: Retail Efficiency and Cost Savings

Labor and Time Savings
For many large retailers, manually updating price tags is an enormous task. For instance, Walmart estimates that by using electronic shelf labels, each store can save 48 hours of labor per pricing update cycle. The time saved allows employees to focus more on customer service and store maintenance instead of repetitive tagging tasks.

One of the first large supermarket chains in the U.S. to adopt electronic shelf labels, Kroger, reported significant labor savings. Employees now spend less time on administrative tasks and more on customer service. This shift demonstrates how electronic shelf labels help retailers allocate resources more effectively, improving efficiency while enhancing the customer experience.

Inventory Management and Dynamic Pricing
Electronic shelf labels also bring new capabilities in inventory and sales management. By integrating with the store’s inventory system, electronic shelf labels enable retailers to automatically discount perishable items nearing their expiration dates. This reduces food waste, which is especially critical for grocery stores, while also encouraging customers to purchase discounted items.

Moreover, electronic shelf labels support demand-responsive pricing. For example, in hot weather, stores can increase the prices of cold drinks or ice cream to reflect higher demand. By dynamically responding to purchasing patterns, electronic shelf labels help stores maintain balanced inventory levels, boost sales, and minimize excess stock.