Atlanta, Jan, 12, 2024 – Electronic labels, also known as digital labels or electronic shelf labels, are devices that can display price information and other product details. These labels offer multiple advantages beyond the obvious: cost savings and an efficient use of workers’ time.

Eight advantages of electronic labels for companies

  1. Remote update: Labels can be updated centrally and automatically. In this way, employees do not have to change price labels manually, which saves time and reduces human errors.
  2. Dynamic pricing: Retailers can adapt prices in real time based on demand, inventory, and other variables. This can be especially useful for managing perishable inventory, thus maximizing sales, and minimizing waste. It also allows increasing revenues, especially during promotional periods.
  3. Integration with inventory management systems: Electronic labels can be linked to inventory management systems to provide real-time information on product availability and avoid stock-outs.
  4. Reduced errors: By eliminating the need to manually change price labels, the likelihood of labeling errors is reduced, which in turn prevents losses and returns due to incorrect pricing and minimizes problems at the point of sale or customer complaints.
  5. Improved customer experience: These labels help display additional and updated information such as promotions, product details and nutritional information. Improving the shopping experience allows building customer loyalty and thus increasing sales in the long term.
  6. IoT compatibility: By integrating with other Internet-of-Things devices, electronic labels can facilitate automation and decision making based on real-time data.
  7. Labor savings: Stores often save a significant percentage of labor costs thanks to electronic labels. By not having to manually change price labels, employees can be reassigned to other tasks that provide more business value, such as improving customer service.
  8. Return on investment: Although the upfront investment in electronic labels can be substantial, especially for larger stores, many retailers report a positive return on investment within 12 to 24 months due to savings in labor and operating costs and improved price accuracy.

Despite the many benefits, it is essential that companies also consider the initial costs of implementation and staff training. In addition, these benefits vary depending on the nature and size of the facility, the frequency with which prices are changed, and other operating factors.

It is crucial that stores conduct a detailed cost-benefit analysis before implementing electronic labels, taking into account factors such as the initial cost, the size and nature of the store, and the pricing strategy they wish to adopt.

Sectors benefiting from electronic labels

  • Retail: It is safe to say that this sector is the main beneficiary of electronic labels, including supermarkets, electronics stores, and pharmacies, where price management is particularly demanding. It is in these industries that the benefits outlined above are most exploited. But they are not the only ones.
  • Logistics: In warehouses and distribution centers, electronic labels can help track products in real time, improve inventory management efficiency and speed up picking and packing processes.
  • Hotels: Regardless of the type of accommodation, electronic labels can be used to display room prices and availability, as well as additional services.
  • Libraries and educational institutions: Electronic labels help manage and track books and other resources.
  • Hospitals and medical centers: In this case, electronic labels can be used to track equipment, medicines, and supplies.

There are undoubtedly numerous benefits for companies, but what about consumers? Well, from the consumers’ point of view, electronic labels offer several direct and indirect benefits.

Five advantages of electronic labels for consumers

  1. Price accuracy: One of the main benefits for consumers is the assurance that the price they see on the shelf matches the price at the point of sale. Errors in manual labeling lead to discrepancies and unpleasant moments at the checkout.
  2. Additional information: Some advanced electronic labels can display additional information about the product, such as nutritional details, origin, instructions for use, or even ratings and reviews from other consumers, something that is increasingly taken into account, regardless of the product or service consumers want.
  3. Sustainability: By reducing the need for paper labels, stores contribute to minimizing waste. Although this is an indirect benefit, environmentally conscious consumers appreciate and actively seek products from companies that adopt sustainable practices.
  4. Interaction and customization: Advanced electronic labels, especially those with touch or smartphone interaction capabilities, can deliver tailor-made experiences to consumers, such as product recommendations based on past purchases.
  5. Brand trust: The ability to keep pricing and product information up to date and accurate can increase consumer confidence in the store or brand by demonstrating that the company is investing in technology to improve the customer experience.

Electronic labels not only offer numerous advantages but are also easy to implement: a communication network transmits the price so that it appears automatically on each of the labels previously placed on the shelves. In this way, the amount is updated each time it is changed in the system.

For the labels to work, a communication station and a management software license are required. Regarding the software, the good news is that these labels can be integrated with the company’s existing ERP system. It is also necessary to have an antenna router and a server/PC (including its configuration) and, if possible, it is advisable to hire consulting, installation, and training services.

In short, electronic labels are here to stay and we will see them in more and more stores. Companies that do not want to be left behind or give an “old-fashioned” image should seriously focus on the innovation that these smart labels represent.

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