Next generation graphic display labels, the trend to showrooming and growing internet sales, have created a perfect storm for electronic shelf edge label supplier Displaydata, formerly ZBD, according to CEO Andrew Dark.
Speaking from NRF in New York this week, where the company unveiled its new brand identity and latest graphic display labels, Dark reckons Displaydata is ideally placed to capitalise on current retail trends.
“It’s a perfect storm for us,” he says. “All these components are coming to bear – our new labels, which are crisp and white and suitable for brand image; the pressure of showrooming and the internet, plus the fact that a scrappy piece of paper that moves around on the shelf edge is not the way to engage with a mature consumer.”
The relaunch follows a root to branch reassessment of the market and business last year and subsequent $25m investment in the firm from long-term investors Trillium International, DFJ Esprit, Lansdowne Partners and TTP Ventures in August 2013 and more recently from Zebra Technologies Corporation.
Dark claims the sum raised was in direct response to the messages the company was delivering to the marketplace.
As a result, Displaydata has extended its leadership in fully graphic shelf edge labels with two further ranges, which co-exist on its two-way network.
It has increased the white space on the labels to create a strong black on white image and introduced colour – red, black and white – to accentuate sales promotions etc.
In a further piece of innovation, Displaydata is introducing labels, which can feature Bluetooth low energy beacons, managed by the company’s infrastructure, in order to deliver information to consumers and/or associates as they move around the store.
Dark says they can be used to communicate with shoppers 20cm or a few metres away from the shelf edge and are managed remotely.
Crucially, they will enable retailers to provide one-to-one offers and glean information from shoppers – whether they accept offers, how they travel through the store and the effectiveness of visual displays, for example.
Shoppers will simply download a retailer’s app in order to access promotional messaging automatically. And, while Bluetooth beacons are new, they are ‘backwards compatible’ to smartphones, so the most ubiquitous in terms of technology versus, for instance, Near Field Communications (NFC).
“NFC is extensive at the Point-of-Sale but there isn’t the technology to present against smartphones and coverage is slight. No iPhone has NFC capability,” explains Dark.
New electronic shelf labels enable retailers to promote graphical data, a key requirement in grocery retailing when stores need to communicate the origin of fresh produce, the salt content of new products or a new pack size, for example.
And, when retailers are potentially operating thousands of stores, synchronising traditional label changes can be incredibly complex and prone to human error, says Dark.
“Being able to respond consistently and effectively is key,” he says.
The company says its system enables retailers to ‘sweep’ the internet and compare prices with rivals in order to offer a competitive deal but the bonus of instant consumer gratification.
For food retailers, meanwhile, dynamic pricing can overcome the flaw of popular price matching campaigns, which provide shoppers with coupons or money off their next shop, rather than their original purchase.
“Consumers don’t like that plus they’ve got to remember to bring the coupon along or it expires or they lose it and they know they’ve given the grocer another £x pounds of margin,” says Dark. “Retailers can’t maintain the pace of paper and price matching across stores. They say they are pricing matching but they are giving out coupons to redeem off the next purchase.”
Displaydata’s business is split broadly 60:40 food to non-food in volume terms and is worldwide. Grocery dominates its activities in Europe and Scandinavia and non-food in North America.
ESLs are yet to penetrate the vibrant UK grocery market but Dark anticipates a change this year, while an announcement regarding a non-food retailer launching a pilot is reported to be imminent.
Displaydata’s labels are already deployed across the superstores at Morrisons-owned baby retailer, Kiddicare.
Dark reports the specialist, which is developing bricks and mortar stores on the back of a successful online operation, is delivering real transparency and exploiting the showrooming trend by showcasing competitor’s pricing and enabling dynamic pricing. Instant product availability – a pram expectant parents can take home with them that day – is well worth any premium customers may be charged, suggests Dark.
Consumers also yearn for ‘old fashioned’ service such as an opportunity to touch and feel a product and the assurance that someone is there to fix a problem if things go wrong; as well as a competitive price, he says.
Amazon may offer competitive pricing but shoppers don’t necessarily know who the vendor is, he maintains.
Displaydata seems to have unlocked a perfect retail opportunity indeed.