Peter Jones says it has become the first UK department store to pilot electronic price tags.

The London retailer, part of the John Lewis Partnership, is replacing paper labels in its audio-visual department with real-time on-shelf pricing information.

‘We are constantly adjusting our prices to match those of our competitors,’ said John Lewis project manager Tracey Yates. ‘We are always looking for ways to speed label production and ensure the most current information is available to customers.’

The system combines LCD-based labels from supplier ZBD with software and expertise from services company Episys. Data is sent from the mainframe to the shelf over a wireless network.

‘The operation must be 100 per cent reliable and the text on the labels must be clearly visible,’ said Yates. ‘If all the operational factors are in place, we will carry out a full cost-benefit analysis over the next few months.’

The theory of electronic labelling is sound, says AMR Research analyst Nigel Montgomery. ‘If stock on the shelf runs low or is selling well, electronic labelling should mean you don’t have to alter prices manually,’ he said.

‘Retailers are spending a lot of time trying to understand better the effectiveness of promotions, so it makes sense that linking the labels to that kind of data will allow pricing flexibility.’