In Defense of Digital Price Tags

02/10/2026

The price tag on a store shelf is one of the most basic promises a retailer makes to its customers: Pick up this item and know what you’ll pay at the register. Trust is the most important currency a retailer has with a customer, underpinning the loyalty built in an incredibly competitive market.

A new technology known as electronic shelf labels is helping retailers keep that promise more reliably by making prices clearer, more accurate, and easier to update when savings are available.

Retailers are inherently competitive, which means stores are constantly trying to innovate. Electronic shelf labels, or ESLs, are one small piece of that effort, visible right there in the aisles.

But these innovations have sparked concern among some critics who worry the technology could be used to confuse shoppers or enable unfair pricing practices. Those fears misunderstand both how the technology is used and how retail works.

There are many benefits that come with the adoption of ESLs.

One of the most common frustrations consumers face in stores is discovering that the price on the shelf doesn’t match the price at the register. Prices change due to promotions, supplier adjustments, or inventory shifts, and manually replacing thousands of paper labels across a store takes time. Human errors happen.

Electronic shelf labels help eliminate that problem. Because digital tags are updated directly from the same system that sets register prices, the price you see on the shelf is the price you pay at the register. That kind of consistency is not a threat to transparency — it is transparency. For shoppers, it means no surprises, fewer disputes at checkout, and greater confidence that the store is charging what’s on the shelf.

ESLs also allow retailers to lower prices faster. When prices are printed on paper, markdowns, especially on perishables or overstocked items, can be slow and inconsistent. Products that might have been discounted earlier may sit at full price longer, eventually becoming waste or being marked down too late to help shoppers.

Digital shelf labels allow retailers to adjust prices the moment it makes sense to do so. That can mean quicker discounts on food nearing its sell-by date, faster clearance pricing on seasonal items, and more timely promotions overall. In other words, ESLs make it easier for consumers to find genuine deals when stores need to move inventory.

Critics point to the flip side of that argument, noting that if prices can be lowered quickly, they can also be raised quickly. They warn that while retailers may not be abusing this technology today, it could be used to mislead consumers in the future by changing prices too often or in confusing ways.

Both concerns ignore a basic reality: retail is one of the most competitive industries in the economy.

Consumers are not captive. They comparison shop, check prices on their phones, and switch stores easily. A retailer that tried to play pricing games would quickly lose trust—and business — to competitors down the street or online. In retail, reputation matters. A store that develops a reputation for confusing or unfair pricing doesn’t gain an advantage; it drives customers away.

This is why fears about widespread misuse tend to remain hypothetical and are unsupported by independent studies. The incentives simply don’t support it. Technology does not override market forces or poor customer service.

That competition is also why retailers are constantly searching for ways to operate more efficiently, not to deceive shoppers, but to keep prices as low as possible in a low-margin business. Grocery and general merchandise retailers operate on razor-thin margins. Small inefficiencies add up quickly, and higher operating costs eventually show up as higher prices.

Electronic shelf labels are one of many tools retailers use to modernize operations, alongside improved logistics, better inventory forecasting, and smarter replenishment systems. These investments help stores respond more quickly to changes in demand, reduce waste, and stay price competitive. When retailers run more efficiently, consumers benefit through lower prices and better availability.

It’s also worth remembering that price tags, paper or digital, do not set prices on their own. Retailers do. ESLs don’t create new pricing strategies; they simply make existing ones more accurate and responsive. The same competitive pressures that govern pricing today still apply.

At their core, ESLs help ensure that the price shoppers see is the price they pay, and that discounts can reach consumers faster when they matter most. In a competitive retail landscape where shoppers have more choices than ever, technologies that improve accuracy and efficiency are not threats. They are part of how retailers continue to earn consumer trust.

Innovation in retail isn’t about outsmarting shoppers. It’s about serving them better. Digital price tags are one small but meaningful step in that direction.

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