Electronic shelf labels: Customers' perception, approval and behavioral responses - a field experiment

The emergence of online grocery retailing challenges pricing strategies of brick-and-mortar stores. New developments for displaying prices at the point of sale, i.e. electronic shelf labels (ESL), allow retailers to employ dynamic pricing strategies. However, little is known about customers’ approval of ESL. While ESL endorsers point to the perfect matching between prices displayed on the shelves and stored in the retailers’ computerized data base for issuing checkout bills, opponents refer to negative consequences for consumers who might by confused by frequently varying prices. The current research reports results from a field experiment. Overall, the findings of this study reveal that consumers experience ESL positively. Compared to traditional price labels, ESL creates a more positive store image and favorable behavioral responses. Explanations and implications of the results for retailers and policy makers are discussed.