How stores lure customers: electronic price tags
Progress in the retail industry is fast. Sometimes new technologies are introduced at the initiative of the state, which, for example, wants to know about all purchases in stores - soon only online cash desks will be installed in them . In other cases, the stores themselves are looking for ways to attract customers.
Today we’ll talk about how retailers lure customers and wage “price wars” using electronic price tag technology.
What it is
Electronic price tags (EC) are displays of various sizes, which display information about the product and its price, and sometimes additional data. The technology of electronic price tags appeared abroad about 20 years ago, it is used by many large European retailers. In Russia, the process of introducing them in stores was legally simplified only in 2016, but in a short time only a few players conducted pilot implementations of the system and were satisfied with the results.
At present, ECs are available on the market whose screen diagonal is from 1.5 to 8 inches (from 3 to 20 cm). Small electronic price tags, such as 1.5-inch ones, are most often placed right on the shelf of the display next to the goods. Larger displays (6–8-inch) are usually mounted on a hanging ledge above the product or on separate stands next to bulky goods. There are several types of electronic price tags - infrared, with a radio channel and working over Wi-Fi.
At first glance, it seems that these digital displays help shops save money on consumables when printing paper price tags. However, if you dig deeper, it becomes clear that this is a powerful tool for marketing and competition.
A store that uses electronic price tags can gain an advantage in the fight against competitors working the old fashioned way using paper. In general, it is very difficult to carry out promotions often in food retail using the second approach - therefore, well-known magazines and newspapers listing goods with discounts appear in stores no more than once a week.
At the same time, retailers actively analyze the activities of competitors, so any marketing campaigns and discounts do not go unnoticed. In the case of traditional paper price tags, lowering the price of a group of products after a competitor is not so easy - at least a week will be spent on preparing new price tags in stores, as well as printing marketing materials.
When using electronic price tags, you can make changes within one day. As a result, a store that repeats the steps of a nearby competitor here may deprive it of the benefits of the campaign and, conversely, increase its own revenue through large sales.
In addition, when using electronic price tags, the store gets the opportunity to conduct “peak hour” campaigns, when the price of the goods is valid only within a certain time. With paper price tags, it is virtually impossible to carry out such actions, and the use of electronic ones makes it easy to change the price during the day and attract buyers.
As a bonus, abandoning paper price tags, the store saves on staff and supplies. Think for yourself: to change the price of even one product, you need to print new price tags, and then place them on the shelves. If we are talking about a chain of stores or the need to change the price of many goods at the same time, then the task is many times more complicated.
Mobile applications: own price for each client
More and more retailers are releasing their own mobile applications. However, they are usually not very useful for buyers - most often with their help you can only receive alerts about promotions taking place in stores. Given that in large networks more often than once a week promotions are rare, then interaction with application users is not of great benefit.
Electronic price tags can add more personalization to this process. Many of these devices are equipped with NFC-modules - like most smartphones (for example, this technology is widely implemented in Hanshow price tags). So the price tag can interact with the phone, which was nearby.
For example, if an application is installed on the smartphone, the user of which participates in the loyalty program of the trading network, then when approaching the price tag, he will see the price of the goods with his own discount on the phone screen. This eliminates the need to carry plastic cards of the store or call the phone number or e-mail at the checkout to find out the final price with the discount.
In addition, the interaction of the smartphone with an electronic price tag allows stores to provide opportunities for manufacturers to conduct promotions. For example, a soda producer may offer a discount on goods to certain groups of users of the application on specific days - and they will see information about this on the electronic price tag when they are in the store next to the desired shelf or refrigerator.
Less negativity and financial loss.
When using paper price tags, various errors can occur, leading to negative feedback from buyers. A common situation - in the cash software, the product has one price, but for some reason the price was different (for example, an employee made a mistake or forgot to change it). This is already being revealed at the checkout, and if the product “made its way” at a higher price, the buyer is unlikely to like it.
Finding out the reasons for the incorrect display of prices delays the queue, customers remain unhappy. Moreover, by law, the store is obliged to sell the goods to the buyer at the price indicated on the price tag. That is, immediate financial losses are possible here.
Paper price tags are usually not very large and it is not easy to consider such details about cost and discounts on them. As a result, it often happens that the buyer expects to receive the goods at a lower price and gets upset when he finds out that he did not get into the right time slot. And any deposit left by the client leads to the fact that another time he will not come to this store, giving preference to a more loyal competitor. Electronic price tags can be much larger than paper ones; in addition, several information screens can be displayed on them sequentially, and not just static text. As a result, they are easier to consider all the details associated with the price.
What prevents the introduction of electronic price tags
Despite all these advantages, there are a number of factors that limit the spread of electronic price tags in our country. First of all, at the legislative level, their use was allowed only last year, so not all retailers managed to analyze the benefits of their use.
Another important point - the introduction of an electronic price tag system (hardware + software) is quite expensive. Equipping a large store with 20 thousand price tags at the moment will cost about $ 400 thousand. At the same time, prices for elements of electronic price tag systems are constantly decreasing - there are more and more cheaper devices from Chinese manufacturers. As a result, over the past few years, the cost of introducing such systems has decreased by about 20%.
As a result, now the payback period of such systems in Russia is 4-5 years, if you do not take into account the economic effect of marketing campaigns, and only take into account staff costs and printing price tags on paper. This often does not suit the business. In our country, few companies are planning for such a long time, usually management expects to see a return on investment already today or at least within a year. It is important to understand that electronic price tags are needed not just as a means of displaying prices or improving the image, they should be used as a marketing tool, only then the business will get real benefits.
According to the results of pilot implementations carried out in a number of stores, there is already evidence today that the installation of electronic price tags can reduce the cost of using paper price tags by up to 30%. A growing number of successful projects, together with a decrease in the cost of such systems, indicate that soon more and more stores will begin to use electronic price tags.
Want to learn more about the marketing opportunities of electronic price tags that will help the retailer increase the average check and increase customer loyalty? Leave a request for consultation on the website of the company “Pilot” https://www.pilot.ru/catalog/elektronnye-tsenniki/ .