Why Walmart’s New Digital Pricing Could Be Another Step Toward Higher Prices

Walmart’s shelves are getting a high-tech makeover: the retailer will replace paper price labels with digital ones at thousands of stores nationwide. Digital shelf labels will look very similar to the paper versions and will be present at 2,300 stores by 2026. 

According to Walmart's official blog, the shift to digital labels is about “improving efficiency and customer satisfaction.” The new digital pricing system allows price changes with just a few clicks, so gone are the days when employees had to change out every label in the store manually.

 In addition to updating prices, the new digital system will allegedly make it much easier for employees to keep track of stock replenishment and stay on top of order fulfillment.

 The new system will also be much more environmentally friendly, reducing the waste the store produces from the old paper labels.

But just how might it actually impact the shopper's wallet?

The digital shift comes after Wendy’s “dynamic pricing” snafu, in which the company was criticized for suggesting hourly, demand-based price-tweaking.

Greg Cathey, senior vice president of transformation and innovation at Walmart, clarified that the company has no intention of doing that. "It is absolutely not going to be one hour; it is this price, and the next hour, it is not," Cathay said at last week’s Walmart Annual Shareholder meeting.

However, there is potential for prices to change as often as every day. Previously, vendors sent out pricing updates to Walmart weekly, but now, digital technology allows prices to change daily. Acknowledging this fact, Walmart spokesperson Cristina Rodrigues clarified that prices would be updated overnight, outside store hours, but left the same during the day, so customers needn’t worry about hourly price shifts.

Earlier this year, Walmart experienced an internal system failure with their self-checkout stands, which resulted in the mispricing of thousands of items. 

People who bought anything at self-checkout were either overcharged or undercharged, and the issue was said to last at least three days, according to Bloomberg. 

Although the issue was eventually resolved, and 80% of overcharged customers were eventually reimbursed, the self-checkout fiasco is a prime example of the risks companies face when using digital products to facilitate transactions.

Because the new digital pricing system will alleviate the workload for Walmart staffers who used to spend days walking around the store to update paper price labels, the move can mean receiving more assistance when needed. 

“A price change that used to take an associate two days to update now takes only minutes with the new DSL system,” according to the Walmart Blog. “This efficiency means we can spend more time assisting customers and less time on repetitive tasks.”

Look for digital price labels the next time you shop at Walmart. While there are always risks associated with store changes, your online orders may be processed faster, and the items you need will probably be in stock.

And make sure you're on alert to shop smart should those prices start to get a little wonky.