Coles, Woolworths refuse to rule out dynamic pricing

The advent of electronic shelf labels (ESLs) has raised concerns about in-store dynamic pricing and the effects that such pricing could have on customers.

Designed to replace traditional paper tickets, ESLs are seen as an efficient and sustainable addition to a retailer’s operations. They are already being adopted by major businesses across Australia.

However, former ACCC chair Alan Fels told ABC News that the technology opens the door for dynamic pricing, a practice that rapidly changes the price of a good in response to demand.

The ACCC currently rules that dynamic pricing is not illegal, but “businesses must be clear about the price consumers will pay”, without making misleading claims.

Inside Retail asked some of these major retailers whether they had incorporated the ESL technology into their operations, and whether they could rule out the possibility of dynamic pricing in the future.

“We do not use personalised, surge or dynamic pricing and this won’t be changing,” a spokesperson for Bunnings responded.

Bunnings said that ESLs are “having a positive impact for our team in stores, saving them time on manual processes and allowing them to spend more time with our customers on the floor”. The spokesperson added that the ability to change prices quickly helps its value-conscious customers, and reduces the use of paper in-store.

Supermarket giants Coles and Woolworths are at different stages in the implementation of ESLs.

“We’ve already installed around 17 million ESL tags across more than 600 Australian stores and more than 170 stores in New Zealand,” Woolworths said.

“Electronic Shelf Labels are designed to replace paper tickets in-store. They make updating labels far more efficient, they save a lot of paper, and they free our store teams up for other customer-focused tasks.”

Coles added that ESLs are not yet widely used. The technology remains on trial in 11 stores before a planned wider rollout.

Neither company responded to the question on whether they could rule out using ESLs to implement dynamic pricing in the future.

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