Digital shelf labels are supposed to save shoppers money. A new NJ law says they could do the opposite—and put a one-year freeze on them

In North Bergen, New Jersey, a Walmart Supercenter is implementing electronic shelf labels (ESLs) that can only lower prices, not raise them. This is part of a one-year moratorium on ESLs in New Jersey, enacted in response to concerns about price manipulation. The technology is also facing scrutiny on a national level, with similar laws passed in Maryland and pending in other states.

Companies and industry groups are distancing ESLs from controversial pricing practices like dynamic pricing and surge pricing. While retailers argue that ESLs save time and cut costs, critics claim they make it easier for retailers to manipulate prices. Retailers emphasize that ESLs do not collect personal data or interact with shoppers, and that all pricing actions are centrally controlled by their pricing team.

However, the technology could theoretically make it easier for retailers to price more dynamically, potentially leading to negative pricing scenarios. For now, retailers are working to convince consumers and lawmakers that ESLs won't open the door to problematic pricing practices.