ESL: The (Seemingly Endless) Search for Retail Adoption

Once again this year, there are new companies introducing new electronic shelf label (ESL) systems that they hope will - once and for all - replace paper labels at the shelf edge in supermarkets.


It was two years ago, in this space, that I asked the question, "Is it time for the electronic shelf label?"

I had a look at W5 Networks, a privately owned ESL start up. W5's solution appeared similar to the early, wired versions, using a paper "surround" printed with the detailed product information and an LCD window to display the retail and unit price. W5 moved to a wireless network that greatly reduced their installation cost. Based on some Google searches, it appears, however, that W5 has been absorbed into another company or dissolved.

Currently, one of the new ESL players is ZBD Solutions, which was demonstrating its new solution in the Innovation Station area at the NRF BIG Show. ZBD also uses wireless communications to reach the shelf edge but it removes the need for paper surrounds to carry the product details. Their monochrome "epaper" display is resolute enough that to carry detailed product descriptions, which are, of course, updated electronically. In fact, the tags can contain several screens of data that can be directed to display unit pricing, emphasize promotions, or help employees with shelf layout and replenishment.

ESLs have seemed to be a "no brainer" for at least 20 years, but no one has, it appears, met the price point necessary for mass adoption in supermarkets. Special situations in perishables departments have seen implementations, but the thousands of weekly price changes done in center store are still executed manually. W5 Networks argued that their costs were justified by some additional features, such as temperature sensors and interactive buttons that integrated the tag into the retailer's shelf and inventory management processes.

ZBD has gone back to a simpler approach, focusing on the display function, but it is also significant that they have reduced the in-store coordination involved by eliminating the paper surrounds. The wireless capabilities, of course, are a great time and money-saver. One small transmitter per store is all that's required. Although the per unit cost of the ESLs is no lower than earlier models, the company claims the system benefits result in "ROI in as little as 12 months." ZBD has introduced its system in other retail verticals - mobile phone and CE stores, for example - and points to the ability to display "rich content" on the devices, including branding, logos and product information.

One thing of concern about the ZBD approach is whether it will be accepted by the various jurisdictions that control Unit Price Labeling requirements today. One of the reasons earlier vendors stuck with the printed surround was because it made it easy to comply with various state requirements for fonts, font sizes, and label colors. The company says regulations will need to be addressed on a state-by-state basis where such regulatory requirements exist (and possibly a county-by-county basis), but that the graphical controls should be adequate to do any customization necessary for compliance.

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