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What Are Digital Shelf Labels? Benefits and Applications in Retail
The world of Digital Shelf Labels – or DSLs – is undergoing constant evolution. Propelling retail environments into the digital era, the upgrade from traditional paper tags revolutionizes how product pricing is displayed on physical store shelves. Manual pricing is now a thing of the past, giving retailers the agility to adopt more robust marketing strategies and adjust their prices seamlessly according to market fluctuations, seasonality, competitors, or any other factor impacting the sector.
In this article, we explore the benefits and applications of digital shelf labels, delving into the major shifts they bring to the retail ecosystem and how they improve price management strategies.
What Are Digital Shelf Labels (DSLs)?
Electronic labels — or Digital Shelf Labels (also known as DSLs) — are equivalent to the traditional pricing labels found in retail stores in almost every way… Except they are fully digital (and connected) instead of simple paper printouts. They are essentially small screens attached directly to the shelves, displaying real-time product information.
What truly sets them apart is the fact that, unlike their paper counterparts, they can be updated remotely and on the fly without having to send someone to swap out the tags physically. The system relies on a wireless communication network that connects the digital shelf labels to the store’s central database, making updates automatic and instantaneous. This ensures a streamlined process that helps the stores’ efficiency and cost-effectiveness.
How Do Digital Shelf Labels Work?
The technology behind digital shelf labels allows them to transcend the capabilities of their paper equivalents. They display information dynamically at the shelf edge by leveraging wireless communication and e-paper technology, giving shoppers the most comfortable reading experience while integrating innovative functionalities for a more streamlined feel.
VusionGroup Solutions use digital shelf labels to digitize retail environments and transform stores into digital assets. Available in various sizes, black-white and red or full color, the connected tags rely on IoT to receive real-time updates and display pricing or product information, promotions, etc.
Key Components of a Digital Shelf Label System
Digital shelf label solutions offer benefits that paper tags can’t rival. That said, they do require crucial hardware and software components. As discussed above, the choice of display plays a part in the overall experience. From e-paper to LCD or even OLED screens, the decision depends on your specific needs (broad viewing angles, superior contrast, clear visibility under direct sunlight, etc.). However, the type of display has an impact on battery life. Solar cells or wireless charging techniques can enhance it for models with a higher energy consumption. Under ideal circumstances, batteries will last up to several years.
Another essential aspect of DSL solutions is their integration with your retail management system. Your point-of-sale (POS) or enterprise resource planning (ERP) system serves as a central interface, and the data is relayed through the wireless communication technology most suitable for your store, including Wi-Fi, Bluetooth, NFC, RFID, etc. Each offers its perks, such as interactivity through NFC to boost customer engagement, for instance.
What are the benefits of Digital Shelf Labels in Retail?
Digital shelf labels provide retailers with the tactical leverage to enhance their operational efficiency and refine their pricing strategies. Digitizing their store also elevates the customer experience while boosting staff productivity, thus bolstering profit margins.
Enhancing Price Accuracy and Reducing Errors
Traditional product labeling is prone to human error, and inaccurate labels may be difficult to spot and time-consuming to fix, misleading customers to the detriment of the store. DSL systems require no human input beyond what is supplied to your product database. Anytime an element is updated, the labels reflect the change in real time, ensuring there can be no price differences to confuse or disappoint customers. Your labels are synchronized with your promotions and advertising campaigns the minute they launch.
Improving Operational Efficiency
While it may seem surprising given the upfront cost of a DSL system, the solution can drastically reduce operational expenses through significant savings in labor and materials costs. Digital shelf labels mean no additional money spent on paper labels, printers, and ink. More crucial still, your employees don’t need to spend precious hours adjusting product prices manually, one at a time. Instead, a simple change from the POS allows a store manager to update thousands of price tags in just a few minutes.
Increasing Employee Productivity
Not having to perform low-value tasks, employees can dedicate their attention to shelf replenishment, product display, and, of course, customer service.
It is also worth noting that digital shelf labels allow you to centralize all stock information in your store, making inventory management much more straightforward. From ordering to returns and order fulfillment through your store’s website, everything can be handled remotely.
Enhancing Customer Experience
More available staff is undoubtedly a significant benefit for shoppers, but it isn’t the only way digital shelf labels enhance their experience. Thanks to their interactive nature, electronic labels deliver much more information than paper labels ever could. NFC technology or dynamically updated QR codes are all it takes for customers to access additional data through their phones. Digital labels are an engaging way to feature clear, accurate, and real-time pricing information and promotional offers.
Enabling Agile Pricing Strategies
Agile pricing is considered one of the top advantages of DSL solutions, allowing you to leverage the full potential of automation by setting flexible prices based on current market demands. Digital labels let you keep up with trends and competitor pricing, adjusting your strategy to stay ahead and maximize your margins as opportunities arise without any manual input. With the right configuration, it all happens automatically!
Are Digital Shelf Labels Suitable for All Types of Retail Stores?
Digital shelf labels extend their benefits to any retail environment where pricing information needs to be displayed. Digitization isn’t just a buzzword. It provides retailers with the opportunity to future-proof their stores and business models, all while saving money and managing their resources optimally. From small shops that need to maximize their employees’ time to large retail chains looking to centralize their pricing strategy, DSLs can benefit everyone.
Applications of Digital Shelf Labels Across Retail Sectors
Retail is where the full potential of digital shelf labels truly shines. From perishables all the way to fashion and apparel, home appliances, electronics, and healthcare products, digitizing makes sense at every level of the retail industry. The solution finds countless sector-specific applications, making it a game-changer for many retail professionals.
Grocery Stores
The role of digital price displays in supermarkets has become central. Grocery aisles are at the heart of customer interactions and condition the quality of the overall shopping experience. This is where purchasing decisions happen, where promotions have the highest chance of swaying opinions. From rich content to price automation, customer activation strategies, and streamlined checkout, digital displays in supermarkets offer clear advantages.
Electronics and Home Appliances
Cutting-edge technologies are at the center of the electronics and home appliances sector. This is why premium fixtures and accessories can make a huge difference in the aisles, where the customers assess the quality of the products, but also how the store itself stacks up against the competition. Digital shelf labels contribute to the high-end image electronics retailers should aim to cultivate.
Fashion and Apparel
Opting for digital shelf labels for clothing retail stores also allows these fast-paced environments to keep up with key trends. ESL solutions optimize in-store processes and, thanks to integrated NFC, customers can access additional functionalities that transform the shopping experience. For example, they can tap their smartphones to enable in-store product reservation and home delivery—a playful way to welcome your customers to your digital universe.
Pharmacies and Healthcare Products
When pharmacy shelf labels and cosmetic labels go digital, they deliver a fully connected experience that ensures optimal agility for the retailer and an enhanced shopping environment for the customers. From real-time pricing updates to optimized inventory management and unmatched levels of product information, electronic shelf labels go a step beyond. For cosmetics, they even act as a gateway to sophisticated services such as AR filters for shoppers to “try on” lipstick or eye shadow.
Future Trends in Digital Shelf Labels
Digital shelf labels provide the ideal foundation for future-proofing your retail activity. The technology itself is ever-changing, with new features and capabilities constantly being developed. Retail businesses value the convenience, safety, reliability, and sustainability of the solution. They also appreciate how appealing digitization is to consumers and already understand the potential of automation in reducing operational and labor costs, freeing up employee time for higher-value tasks.
Digitizing physical stores offers a tangible approach to bridging the gap between e-commerce and brick-and-mortar facilities, centralizing logistics, and ushering in omnichannel retailing along the way.
The ESL market is bursting with new possibilities for business owners and vendors to explore, reshaping the retail environment as we know it.
Integration With IoT and Smart Stores
Digital labels – which communicate with inventory management systems, mobile apps, POS terminals, and more – integrate seamlessly into IoT ecosystems and smart retail solutions, taking them ever closer to full automation. Efficient data exchange is at the heart of such innovative concepts as checkout-free or cashier-less stores and other autonomous retail environments where sensors, cameras, and RFID feed relevant information to machine learning algorithms.
Advancements in E-Ink Technology
We can also expect to see advancements in graphic display technology for digital shelf labels. While e-ink already offers amazing readability, electronic labels are poised to become even more graphically impressive thanks to higher-resolution displays with faster refresh rates and no glare. They will also boast very low power requirements, making them more convenient and sustainable.
Personalization and Data-Driven Marketing
Digital labels already incorporate features that support interactivity and personalized content delivery in the aisles. These features engage customers by providing tailored experiences while allowing you to implement highly targeted promotions and other marketing strategies based on consumer data. From touchscreen capabilities to NFC connectivity, QR codes with links to interactive content, personalized recommendations inspired by previous purchases, and so much more, ESLs open the gates to omnichannel retailing. Thanks to these functionalities, customers can access comprehensive product information, read reviews, unlock AR content, get digital coupons, and complete transactions via mobile payment.
The retail market has much to gain from keeping up with trends and meeting consumer demand, and not only in terms of the products they wish to buy. To compete with the convenient, immersive experiences online shopping offers, retailers can leverage the potential of digital labeling, inviting technology into physical shopping environments.
Digital label solutions are also poised to continue their progression as they find relevant applications in a growing number of industries. From general logistics to healthcare, hospitality, manufacturing, and more, electronic tags facilitate some of the more complex aspects of pricing, inventory management, and asset tracking.
These innovations benefit stores and their customers, redefining the retail world on multiple levels.
