Electronic shelf labels draw the physical and virtual worlds ever tighter

18 Aug, 2016
Hendrik Bredenkamp, MD of XON Retail

Electronic shelf labels (ESL) are now more capable than ever at helping retailers cope with the growing demands of increasingly digitalised shoppers.

Capabilities range from internal retail issues, such as shelf space optimisation, click-and-collect efficiencies, and omni-channel integration, to external shopper-focused benefits like quicker shopping trips, easy product location, digital shopping list fulfilment and click-and-collect opportunities.

“ESL platforms today are helping retailers deal with practical and competitive business issues,” says Hendrik Bredenkamp, MD of XON Retail. “The platform extends the rich functionality of their ESL technology and improves their return on investment (ROI). But it also offers shoppers an easier, more fluid experience inside the store besides the existing comforts they get of knowing prices are always displayed, are correct, and plain easy to find.”

New ESL technology communicates with shoppers’ smartphones. Coupled to sophisticated software and a downloadable app, the ESL system can be extended to track shoppers in stores, anonymously record their movements to feed heat maps, and contribute to optimising the shopping experience overall. The same technology can also lead them quickly to products they’re looking for or help them fill digital shopping lists.

It also informs retailers if their special or promotional offers are effective because they can see how many shoppers went to a particular spot in an aisle, how long they lingered, and whether or not any purchases were subsequently made.

“They can quickly see if customers are interested in a promotion but aren’t buying,” says Bredenkamp, “based on their in-store movement profile. That allows them to try different strategies so they’re in tune with their customers and moving products as rapidly as they need to grow revenues, foot traffic, and customer satisfaction.”

The same principles help retailers improve planogram compliance, task-to-light (flashing lights on ESL tags attract employee and shopper attention for rapid product location), click-and-collect, and omni-channel integration.

ESLs also form the foundation of real-time data on shelf, stock room, warehouse and distribution centre stock levels as well as orders in the queue, which can be extended to Web-based front ends and e-commerce systems.

“The entire cycle can be united, right from the distribution centre, or even back to the manufacturer, right up to the customer placing an order online or walking into a store to get a more tangible feel for products,” says Bredenkamp, “offering an unparalleled retail experience.”

In addition: “European retailers are already offering click-and-collect services in certain regions,” he says. “Retail employees pre-collect non-perishable items for shoppers and leave perishables for when customers arrive in the parking lot outside the shop so they only have to wait a few moments at the most. The system picks up the customer’s cellphone via the WiFi or location-based service as they draw near the shop, alerts employees the customer is nearby, who then fill out the rest of the order. That’s a unique service for high value retailers seeking to differentiate themselves in competitive markets because it focuses squarely on customer convenience while optimising internal retail processes.”

Omni-channel strategies for large retailers starting to push online shopping must overcome challenges like ensuring that stock is available on the floor. There is nothing more frustrating than ordering something for Click and Collect at the closest store only to be disappointed when trying to pick it up. Another problem is to ensure that the online and offline prices are the same. It’s easy to update 2 500 prices online but not so easy on shop floors. ESL solves that challenge. It ensures both online and shop floor prices are the same and correct. European chains, like Media Saturn in Netherlands, has implemented ESL specifically for this reason.

The level of personalisation offered by Click and Collect is an extension of an emerging consumer age that unites the digital universe with the brick-and-mortar shopping experience in pragmatic ways. And it’s these activities that highlight the fundamental benefits of any digitalisation effort: to release people from the repetition of mundane, analogue tasks that detract rather than add to our lives.

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