Electronic Shelf Labels for Dynamic Pricing: The Future of Retail Pricing

Shoppers are laser-focused on price. According to Statista, “For around two-thirds of UK consumers, price was the most important thing when choosing what to buy.”  This underlines just how sensitive shoppers are to price—and how critical it is for retailers to get pricing right at all times.

So, here’s the problem: if price is so crucial, why would a store keep prices the same for days or weeks?Dynamic pricing is well established in e-commerce. And as omnichannel experiences become more important, physical stores also need to become more data driven as well. 

The market changes constantly. And with fluctuating demand, competitor price changes, and seasonal shifts, static pricing puts retailers at a disadvantage. Keeping prices stuck in place means missing opportunities and potentially losing customers. That’s where electronic shelf labels (ESLs) can help. They let stores adjust prices instantly, reacting in real-time to what's happening. It’s about giving shoppers what they want: the right price for right now—while staying competitive and keeping an eye on margins.

What Are Electronic Shelf Labels?

Electronic shelf labels are digital price tags attached to store shelves. They replace traditional paper price labels with e-ink or LCD displays that show product names, prices, promotions, and even QR codes or stock information.

ESLs are typically part of a wireless network that links to a store’s inventory management system or dynamic pricing platform like XPLN’s MARGIN MAXIMIZER. This integration allows retailers to:

• Update prices in real time for thousands of products.
• Automatically apply price changes based on market data, competitor pricing, or inventory levels.
• Synchronise in-store and online prices to ensure price consistency across channels.
• Instantly display promotions, stock information, or additional product details.

The result? Retailers gain the ability to react quickly to competitive pricing moves, optimise for margins, and deliver real-time pricing accuracy.

Why Dynamic Pricing Matters for Modern Retail

When you think of dynamic pricing, you probably think of e-commerce. Retail giants like Amazon started extensively testing and implementing dynamic pricing around 2015 and many other retailers followed suit.

But of course, dynamic pricing as we know it today started long before the internet. The closest comparison to what we see today is the US airline industry in the 1980s. Before the 80s, the American government tightly regulated airline prices. But when prices were put in the hands of the industry, they opted for dynamic pricing almost immediately—clerks would manually adjust ticket prices on their computers throughout the day.

All that is to say, dynamic pricing isn’t just for online spaces, physical spaces can also use dynamic pricing to stay competitive and boost profitability. Physical retailers have just been slower to adopt these tools—and that’s a missed opportunity.

That’s starting to change, and we’ve seen this first-hand in our work with EURONICS, one of Europe’s largest electronics retailers. We provide EURONICS with competitive prices for 100,000 products, updated several times a day. Based on predefined rules, our solution suggests dynamic prices, and around 30,000 products receive new prices on euronics.de daily.

As EURONICS puts it:

“Around 100 EURONICS members who already work with electronic price tags especially benefit from automated price monitoring. Their price tags no longer have to be laboriously exchanged manually week after week, but display the price determined directly.”

Learn more about Euronics’ success story

Benefits of Electronic Shelf Labels for Dynamic Pricing

Let’s look at the real-world, practical benefits of ESLs.

1. Instant Price Updates: With ESLs, you can update prices across every shelf in your store automatically—no more manual label changes. This reduces errors and frees your staff to focus on customers.
2. Competitive Advantage: ESLs make it easy for you to apply competitive pricing strategies, like undercutting nearby stores or matching with online prices in real time.
3. Price Transparency and Consistency: You can ensure your prices are the same online and in-store, so customers always see—and pay—the right price.
4. Improved Promotion Management: Sales and discounts can go live instantly on your shelves, keeping your store aligned with marketing campaigns and flash promotions.
5. Cost and Labour Savings: You’ll save time and money by eliminating the need to print, sort, and attach paper labels manually.

How Electronic Shelf Labels Support Data-Driven Pricing

If you’re investing in electronic shelf labels, you want them to do far more than replace paper tags. The real power of ESLs comes when they’re connected to data-driven pricing strategies—where every price update is informed by real-time market data, internal sales insights, and your broader business goals.

This is where dynamic pricing platforms like XPLN’s MARGIN MAXIMIZER  come into play. Instead of relying on gut instinct or manual price checks, you get a system that constantly monitors competitor prices, evaluates your own inventory levels, factors in historical sales patterns, and applies your custom pricing rules—all automatically.

Here’s what this means for you in practical terms:

• You’ll know instantly if a competitor drops their price on a high-demand product, and you can decide whether to match or beat it.
• You can automatically set minimum margin thresholds, ensuring your pricing stays competitive without sacrificing profitability—critical when you’re working with tight margins.
• You can identify products with elastic demand, where even a small price cut drives significant sales volume. This allows you to compete aggressively on the right products, without underpricing everything.
• Slow-moving inventory can be automatically discounted to accelerate sell-through, all without manual intervention.
• Seasonal promotions, local demand patterns, and even regional differences can be factored into your pricing—giving you granular control across locations

This combination of real-time data, smart pricing logic, and instant ESL updates means you’re always in control—able to balance competitiveness with profitability, react faster than your competitors, and maximise both revenue and margin across your entire product range . For example, on a hot summer's day, you can adjust the price of cold drinks in line with the increase in demand and immediately boost your profit margin.

Overcoming Price Gouging Concerns

Some consumers have raised concerns about dynamic pricing in brick-and-mortar stores, worrying about price gouging—where prices surge unexpectedly (and usually result in consumers paying more). However, responsible retailers can use transparent pricing strategies, where ESLs display time-stamped prices or explain price changes. For example, you can highlight whether a price is a limited time promotion or a change in the raw cost of materials.

Walmart and Kroger have already trialled digital shelf labels, and have largely dismissed consumer concerns about price gouging. UK and EU consumers should be less concerned, as strict rules around “Was/Now” pricing mean retailers must clearly show the previous price and ensure discounts are genuine. The key here is to use the tools at your disposal to be competitive while building consumer trust.

Final Thoughts

The future of retail pricing is real-time, data-driven, and fully automated—and electronic shelf labels (ESLs) are at the centre of it. When combined with a dynamic pricing platform like XPLN’s MARGIN MAXIMIZER, ESLs give you the power to respond instantly to market changes, optimise every price for both sales and margin, and maintain seamless consistency across all channels—online and in-store.

With XPLN’s comprehensive suite of tools, you can:

• Monitor and compare competing assortments and prices across online and offline channels
• Adjust prices in real time to stay competitive
• Automate pricing updates directly to your ESLs
• Integrate with existing Point of Sale (POS), ecommerce platforms, and retail media campaigns.
• Analyse performance and uncover pricing insights to guide smarter decisions