The Benefits of Batteryless Electronic Shelf Labels (ESLs)
Consumers’ shopping experience has gone through profound changes during the past couple of decades. Going back 25 years, shopping was still essentially about brick-and-mortar stores. The advent of online shopping began with the launch of Amazon and eBay in 1995, followed by PayPal in 1999. These were the pioneers of a new era, revolutionizing for good the retail industry and the shopping experience. Today, brick-and-mortar stores coexist with online shopping, with virtually all traditional retailers offering digital options as well. The Covid-19 pandemic has only sped up things, boosting the online shopping trends that were already on the rise. And the impacts remained, with consumers partly back to brick-and-mortar, but more than ever expecting high-quality experiences regardless of how/where they shop.
The word is about omnichannel - i.e. a seamless experience across all shopping channels - from brick-and-mortar stores to multiple mobile and online platforms. This pushes for the digitization of the whole infrastructure including the physical stores. Yet, when we visit a store today, we are most often faced with old-school paper shelf labels and price tags. Truth be told, the transition to digital screens and electronic shelf labels (ESL) is already happening at a fast pace. Nonetheless, there are a few pain points for retailers that prevent wider adoption of ESLs - led by doubts and concerns around the actual net gains these bring in terms of logistics and maintenance as well as sustainability.
Let’s start with a brief introduction to ESL and what these devices can bring into retail segments.
Needs and drivers around electronic shelf labels
ESL are small electronic devices used to display price and product information on the shelves in a store - essentially replacing the traditional paper price tags. These devices consist essentially of a small display and an electronic control module, which enables the device to communicate wirelessly to a central IT system. ESL are mainly used across the retail industry - supermarkets, merchandise stores, drug stores, etc. - but can also be used within warehouses and industrial facilities. They have been invented to overcome the obvious limitations of paper labels: it is easy to imagine the headaches involved in printing and replacing paper labels across a mid to large size store. On top of the logistic complexity, labour-intensive and costly processes, paper labels come with high error rates and a lack of flexibility. For instance, every time you wish to change a price, there’s quite some manual work involved and a relatively long time to complete the process. So, you’ll probably think twice before any change. Now, if you’re running a big retail chain, with coordinated prices across facilities, then you need to think a few more times. Actually, you’ll need some sophisticated processes and plans to deal with pricing!
When we look at ESL as connected Internet of Things (IoT) devices, these bring the possibility of doing instantaneous and syncronized price changes across a whole store, and across multiple locations and channels, using a single software/IT system. And, just like that, we enter the era of dynamic pricing, where retailers can to real-time price changes in all their physical stores and e-commerce channels with a few clicks! Such pricing dynamics are growing in importance as more consumers shop with smartphones in their hands, comparing prices on the fly. With access to aggregated, and often also individualized, data on consumer trends and behaviour, retailers can quickly react to competition and go all over from frequent price updates to tailoring product info/ads to catch the eye of whoever is in front of the shelf.
So, ESL can be game changing tools for retailers in the digital and e-commerce arena. Now, let’s see what kind of tech goes into these devices and how the industry looks like.
Tech and industry trends
With respect to tech trends, let’s look into two aspects: displays and communication.
There are several specific types of displays used in ESL, but these can be sorted in two main categories: LCDs (similar to the ones used in TVs or mobile devices) and electronic paper (e-paper). E-paper technology brings the advantage of extremely low power consumption and optimal energy efficiency. The so-called bi-stable technology works in such a way that the display only needs energy for doing changes in text or images. Once the text/image is created, the display will hold it for a very long time (many years even) without the need for power – essentially like something printed on a piece of paper. These technologies open up for the possibility of batteryless ESL – we’ll get back to that in a minute.
As for communication, the first generations of ESL relyed on infrared (IR) or RFID technologies. Some of the early generations require IR/RFID scanners to drive any changes/updates in the labels, meaning that every change in e.g. price requires staff to point handheld scanners to each and every single ESL that needs an update. Currently, ESL are often equipped with Bluetooth, Wi-Fi and/or Near-field communication (NFC), making systems a lot more user-friendly and unshackling sought-after use-cases for retailers. For instance, NFC is prone to the implementation of self-checkout systems, where consumers can scan the NFC-enabled ESL with their smartphones to pay instantly and safely. Bluetooth and NFC also enable easy access to product information in a mobile device, by simply scanning the ESL, or even real-time notifications directed to individual consumers. So, these technologies are likely to take over the market.
The ESL industry is rising towards a multi billion dollar business, with annual global shipments in the ballpark of 200 million units and double-digit growth rates. Top-players include Pricer, SES-Imagotag, Hanshow, Solum and LabelNest - each with total installed bases of over 100 million ESL units across thousands of stores and dozen of countries. And there is a multitude of other players in this market space across the globe, such as ZKong, Display Data, Teraoka Seiko, E-Ink, M2Comm, ClearInk Displays, Panasonic, TroniTag, Opticon, MinewTag to name a few.
But why do we continue to see paper labels all over supermarket shelves then? Despite the clear growth trends, there are still a few problems to solve in order to make ESL omnipresent across retail. At the top of the list is… right: batteries! The battery in a standard ESL will last for 2-5 years at the most. So, a couple of years past a store installed an ESL system, at best, the units will start flickering for battery replacements. From there on, trouble is in line! There’s word about stores using interns or part-time jobs dedicated to changing batteries in ESL, with buckets of used coin cell batteries and broken ESL pilling up! Well, these stories might actually be a bit old… We went out asking around stores that use ESL in our area - mostly using IR/RFID versions - and these seem to work just fine on their end. Workers at the shop floor do not sound too bothered about the batteries: most say they probably last for about one year or two (some say a little shorter than that), but the ESL supplier takes care of replacing the units frequently enough so batteries do not become a worry. And often they are happy to get the next, slightly better version! In any case, to make retailers happy, suppliers of ESL got to be producing piles and piles of unnecessary e-waste, including batteries and ESL scrap. And also either taking the punch on the costs of frequent replacement or pushing those to the retailers in some form. There has to be a better way for everyone!
Batteryless: the holy grail!
Retailers essentially want what end-users in many other segments want out of small wireless IoT devices: seamless operation, rugged, cheap yet good-looking hardware, and… no deal with batteries! Not surprisingly, the ESL industry has been trying around batteryless options.
Powercast, a company operating within the wireless power transmission segment, has been pitching a so-called batteryless immortal ESL. The ESL unit itself works without a battery, relying on power transmitted from an RFID scanner. They take advantage of a bistable display where, once created, an image is held without the need for any power. In the conventional setup, this means that every update requires an operator to point a handheld RFID reader at the ESL to power and communicate the change. Powercast has partnered to develop a robotic system - which they call autonomous badger robot - that runs through the store to do the work a human operator would do manually, i.e. essentially point an RFID scanner/antenna to each and every ESL that needs a price/info update.
A few more companies are heading in similar ways. For example, Ossia has been partnering with players in the ESL space - namely SES-Imagotag, e-ink and Display Data - to use their Cota wireless power transmission technology to deliver the necessary energy to batteryless ESL. Other examples include Energous and RFinCharge.
Lummico is making batteryless ESL with NFC technology. In this case, it entails bringing an NFC active device (such as a dedicated NFC reader or an NFC-enabled smartphone) close to the ESL for doing any updates. The active device provides the power required for the batteryless ESL to update, similarly to IR or RFID versions.
All these are making steps in the right direction. Yet, using robots, power beacons or solely indoor light does not sound like the ultimate seamless and cost-effective solution.
New options on the way
Ultra-wideband (UWB) technology is a game-changer for the retail industry. With its extremely accurate positioning capabilities and built-in cybersecurity features, UWB opens up a whole new set of use cases in stores: from navigation to three-axis (3D) Real Time Location (RTL) product location tracking. UWB has potential applications in inventory tracking, asset management, and more. This cutting-edge technology allows retailers to improve efficiency while ensuring data security and customer privacy. By combining ultra-accurate positioning with robust cybersecurity features, UWB can be used to create innovative solutions that revolutionize the shopping experience for customers and staff alike, and ESLs are a great place to start!
Bringing it all together: the future shopping experience
If we wrap this into a grand vision for future stores and next-decade shopping experience, we must put in a few ingredients. First, batteryless ESL with advanced connectivity, data collection for retailer analytics and customer interaction options - such as directed adds/notifications, immediate payment and self-checkout, and navigation through the store using a smartphone with real-time inventory check and product location. Second, stores fully prepared with wireless IoT systems, which support ESL and all sorts of other smart IoT trends. Third, seamless management of information and hardware operation for retailers - with integrated IT systems and advanced capabilities for real-time updates across channels and dynamic pricing. Fourth, AI might be giving a hand in the implementation of highly optimized/targeted marketing and dynamic pricing strategies. Fifth, virtual reality (VR)/ augmented reality (AR) devices and virtual twin technology might provide new forms of staff and customer experience bridging digital and physical facilities.
This may be a bit of a futuristic vision, but the transition to digital and virtual environments is already on the way, and relatively simple elements like next-gen ESL can speed things up. The technology modules are out there for grabs - it’s a matter of moving forward with a look not only at better services and experiences but also at the future of the planet as a whole!