Tesco is piloting digital labels from VusionGroup and Hanshow

The leading British retailer has been exploring electronic shelf labels for decades. But now Tesco is apparently really getting serious. In a proof-of-concept in selected Tesco Extra superstores and Tesco Express convenience stores with labels from VusionGroup and Hanshow, the company is evaluating their use.

As Toby Pickard, Senior Partner at the British industry service IGD, revealed to The Retail Optimiser, test stores include a Tesco Extra store in Royston in the UK with VusionGroup labels and a store of the same banner operation in St Neots with Hanshow ESLs. Tesco is under enormous pressure from the pricing policy of the German-based discounters Aldi Süd and Lidl, which are growing at an exceptional rate on the island. Both discounters have now installed electronic shelf labels in their UK stores.

The market for Electronic Shelf Labels (ESLs) has been slow to develop in the UK retail sector. Although the Big Four retailers in the UK – Tesco, Sainsbury’s, Asda and Morrisons – have been trialling ESLs in their stores and announcing projects for around three decades, they have not implemented them across the board. Compared to markets in mainland Europe, the UK is therefore considered a latecomer when it comes to electronic labels. In countries such as France and the Nordics, ESLs have long been standard in store operations and also a large proportion of stores in the grocery retail in Germany have meanwhile digital shelf labels.

Aldi Süd and Lidl set the pace

Both Aldi Süd and Lidl ought to have equipped all of their UK stores with electronic shelf price labels by now. Lidl announced in spring 2024 that it would be finished with the implementation of digital labels in the UK by the end of the year. Aldi Süd manager Dominik Schweers already declared in autumn 2023 that the roll-out of ESLs in all Aldi Süd stores worldwide was almost complete. With regard to the UK, it is quite conceivable that the discounters will also force the market leader Tesco to catch up in order to avoid being left behind if the discounters decide to dynamise pricing.

Asda also recently launched an ESL pilot project. The retailer announced in December 2024 that it would be trialling electronic shelf labels from VusionGroup in a store in its Asda Express banner operation in Manchester city centre. The Oxford Road store is a high footfall store – deliberately chosen by Asda to put the technology to a stress test. UK’s number three retailer – after Tesco and Sainsbury’s – is trialling VusionGroup’s labels to relieve its store staff of time-consuming price changes – a relevant factor with up to 10,000 price changes per week.

Regional co-operative groups are also testing

Regional companies of the British Co-operative Group Scotmid and Southern Co-op have been using ESL solutions from SoluM since 2021, as Talking Retail reported. East of England Co-op, on the other hand, uses Pricer ESLs to make in-store processes more efficient. The digital labels save time, paper and printing costs and facilitate quick price changes – the nationwide rollout should be completed by 2025, as IGD’s Toby Pickard first reported on LinkedIn a few days ago.

If Tesco decides in favour of a roll-out, this should shake up the ESL market in the UK in the long term – with an impact far beyond the UK market leader’s own store network.