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Electronic Shelf Labels: why the UK needs to catch-up

Written by Sean Taylor, Head of Retail Solutions, UK

Electronic Shelf Labels: why the UK needs to catch-up

From Brexit to COVID, 2021 has been yet another rocky year for retailers. Many are using these unusual times to try out in-store technologies – including ESLs. But UK businesses are lagging behind their European rivals.  

More and more supermarket shelves are sporting a slick new gadget – the electronic shelf label. In fact, between now and 2025, the global ESL market is expected to post a remarkable CAGR of around 21%.

So where will we see this shift from paper to digital? A full 49% of ESL growth is expected to come from Europe. And that makes sense, not least because EU regulations penalise incorrect pricing: any retailer who fails to provide transparent, accurate pricing information could face a fine.

 

And the situation in the UK?

While Europe is embracing ESLs, things across the Channel are more sluggish and patchy. As stores emerge from lockdown, they have become more willing to innovate and test in-store technologies, but there is still large variation between companies.

For example, Asda is among the first to bring in the bits and bytes. In November 2020, following a year of planning, ESLs went live at a technology flagship store. Allowing easier implementation of their pricing strategy: the e-paper displays can be changed rapidly and centrally by means of cloud technology. Changes can be enacted in minutes, not hours.

Other large supermarket chains, are also trialling these technologies. So interest in ESLs is clearly, and swiftly, heating up.

Small and mid-sized retailers have agility on their side: they can implement new technologies relatively quickly. 

But if they want to keep pace with major players, and with Europe, they need to act fast. After all, there are plenty of reasons why the UK should be hopping on the ESL bandwagon

 

Honing a competitive edge

Prices change all the time. We only need to look back to loo roll shortages in the early days of the pandemic to see how spikes in demand can be sudden and unpredictable. There are also amendments to legislation to contend with, such as the UK sugar tax that went into force in 2018.

Moreover, there are loyalty programmes and other strategies to make in-store shopping more alluring. But when a business claims it has the lowest prices around, it can’t just talk the talk – it has to walk the walk. That means matching offers, and updating prices constantly, sometimes around the clock. ESLs make it possible.

 

A matter of trust

Incorrect or unclear pricing is a risk to reputation. If the low price shown on the shelf does not ring up at the till, you can (understandably) count on a disgruntled shopper. Even when the promotion is honoured, the negative experience costs more than the revenue. Trust is easily lost. Ensuring the shelf price matches the till is a simple way to safeguard consumer confidence.

In this regard, too, ESLs are very effective. When they were deployed at Costcutter Culverstone Green, owner Peter Juty was delighted with the results: a 100% reduction in human error and an 80% time saving when updating labels. He reports: “There are fewer disagreements over product prices; this leads to a stronger relationship between staff and customers.”

 

Information-rich: blending digital and physical

Customers have grown accustomed to the benefits of online shopping. That includes instant access to a wealth of product information. ESLs help bricks-and-mortar businesses to meet this expectation, by displaying key information. Beyond listing prices, ESLs can include advertising, draw attention to discounts, highlight stock availability, and feature QR codes that provide product origin and allergy information.

The latter is increasingly important. Some 44% of British adults now suffer from at least one allergy. And product labelling is set to become stricter, as Natasha’s Law – in honour of a student who suffered an allergic reaction and died after eating incorrectly labelled food – is due to be enacted later this year.

 

The time is now

Our retail customers often tell us that one of their greatest challenges is rising labour costs. For one, there was the increase in minimum wage in the UK from 1 April. There is also wage pressure from the uptick in inflation. And, of course, there is Brexit: since Feb 2020, the number of job seekers from western Europe has halved, and there has been an exodus of foreign workers.

In this context, ESLs can help by boosting employees’ productivity. When it takes minutes instead of hours or days to update prices, staff can devote their time to more value-adding, customer-facing tasks. A further plus: with fewer people on the shop floor, it is easier to comply with COVID rules.

In short, there are plenty of reasons why UK retailers should be looking into ESLs. An easy way to start is to check out our ROI calculator – so you can see how long it would take for an investment in ESLs to deliver returns.

And if you are interested in learning more about the role of ESLs, you can find information here on our website or contact us for more information.

 

If you are interested in learning more about the role of ESLs, you can find information here on our website.