Electronic Price Tags: The Foundation for Real-Time Price Changes and Dynamic Price Promotions
In today’s retail and consumer environment, the ability to change prices is critical for your survival. In B2B retail, merchandising, and operations, the static, non-digital, paper pricetags have always been an antiprofit and anti-customer engagement. The introduction and automation of digital electronic price tags removes this barrier and enables retailers to execute real-time price changes and extreme loss leader price promotions at the shelf edge. That productivity turns losing pricing control to an agile pricing strategy that enables retail price and cost optimization while remaining dynamically responsive to operational and competitive market conditions.
How price tags capture and promote consumer and retail traffic activity is the basis for this publication. Electronic Price Tags will help drive exceptional market adaptability while supporting the structured and disciplined business environment data driven retail execution demands.
The Problems with Outdated Static Pricing In A Dynamic Market
Weekly or bi-weekly drag and drop pricing and relabeling are at the core of a broken model in today’s quickly accelerating retail industry. This model introduces a dangerous lag time between pricing decisions made at corporate and pricing execution at the store, which allows for competitors to price under a retailer, inventory to sit, and time-sensitive promotions to be missed. Additionally, this latency comes at a high hidden cost; for example, so much labor hours are lost to the printing and swapping of tags that it is almost inconceivable.
Furthermore, the errors that are almost guaranteed in this system lead to price discrepancies and a loss of customer trust. The inability to quickly iterate and refine pricing strategies also adds to the cost of this operational model, resulting in revenue loss, which, in this case, makes the need for a dynamic connected solution an economic no-brainer.
Architectural Foundation: The Ability for Change to be Instantaneous
An ESL’s real-time updating capabilities stem from its unique architecture. Each ESL is an endpoint in a network configured with a secure and low-power wireless connection to a central store gateway, operated through a cloud system. Once a pricing manager initiates a change (even for a single SKU, an entire category, or for a store-wide promotion), data from the central database is sent to the selected ESLs in mere seconds. The flow of data is instantaneous and precise. With each data flow, the shelf price, POS price, and e-commerce price are aligned. Today, the most dependable and low-power connectivity solutions in the retail industry, such as a ble esl plus proprietary mesh network, are used to prevent interference with other store systems while creating the invisible framework that allows for real-time flexibility.
Automating and Optimizing Core Pricing Strategies
With foundational architecture best practices like centralized data, access management, and cloud functionality, retailers can automate and optimize core pricing strategies with unparalleled accuracy. Electronic price tags enable the operationalization of several pricing tactics.
- Dynamic Markdowns & Clearance: Automated systems can reduce prices at preset increments depending on how long an item has been in stock. This maximizes salvage value during clearance markdowns and accelerates the movement of perishable & seasonal products.
- Time Based Pricing: Automated price adjustments can be scheduled based on the time of the day, or the day of the week. This enables the implementation of “happy hour” pricing on prepared foods, during off-peak shopping times, or during time windows where demand is known to be high.
- Automatch Competing Prices: Retailers can enrich their pricing rules with time-sensitive price intelligence to defend their price position automatically within an adjustable guardrail whenever a competitor alters their pricing. This ensures continuous price competitiveness and protects market share.
Executing Complex, Multi-Stage Promotional Strategies
Besides adjusting prices, electronic price tags enable unparalleled flexibility and impact concerning promotional activities. With these tags, the sky is the limit. Customers can be engaged in tailored promotional activities and driven to participate in desired behaviors:
- Flash Sales and Countdown Time Displays: With no prior announcement, short-duration sales can be held to create what marketers refer to as real urgency. Time-sensitive promotional prices can be displayed, and countdown timers can be visually represented on electronic price tags to encourage in-the-moment buying and excitement in the store.
- Cross-Promotion, Bundling, and Recipe Sharing: “Get a Recipe” or “See An Associate for a Bundle” prompts can encourage customers to scan QR codes. This allows for the integration of kiosk digital content and real-world service. Inventory on the physical shelf can be seamlessly integrated with other digital content, thus providing a more complete shopping experience.
- Targeted Offers (Future-Proofing): Electronic price tags within a store that is connected to a retailer’s mobile app and loyalty program can be designed to display offers that have been tailored to a customer. This closes the gap between online-tailored experiences and physical shopping and is designed to be the ultimate in customer-centric retail.
Integrating with Inventory and Broader Operational Systems
What electronic shelf label systems offer pragmatically is value at the core of integration with the entire retail technology architecture. With integration, tags serve more than the functions of price display – they can serve as multifunction devices within the digitized store ecosystem. For example, tags working with a real-time inventory management system can signal ‘Low Stock’ or price decrease in situations of demand over supply and inventory stock out.
On the other hand, at the point of sale (POS) systems, if there’s a demand spike, there are parameters triggered to increment the price in a moderation to guard profitability. The system formed by integration of pricing, inventory, and sales data works as a center of automation for revenue management. It guarantees that the pricing and promotions are flexible as well as demand and supply aligned, working in real-time.
Conclusion: From Pricing as a Function to a Strategic Opportunity
For business to business (B2B) retail specialists, focusing on the installation of a new e-tag system as a unique, value-adding investment as it reposition the business model of the customer as a reactive, back-office price function to a more responsive strategic price setter, is now rapidly changing the business trade model of the value of pricing within the trade pricing, e-mobility and trade margin performance within the retail value chain.
The function of pricing moves from a reactive, back-office function to a strategic driver of price e-mobility, margin performance, and customer perception within the e-mobility value chain. The flawless execution of pricing control, operational error elimination and the removal of operational friction from the pricing model is reactive pricing. The competitiveness on price within this e-mobility value chain trades on vertical and horizontal price competitiveness. The electronic price tag system is now no longer a futuristic retail pillar, but a value-adding operational system. The pricing strategy employed is now as intelligent and responsive as the marketplace.
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