Transforma Insights recently published a report, Inventory Management & Monitoring: 5.6 billion connected devices by 2034 with Electronic Shelf Labels accounting for the largest share, looking at how the number of connected devices used in inventory management is rising rapidly, as businesses look to improve accuracy, visibility, and operational efficiency. This latest revision of the report includes an upward adjustment to our projections, reflecting the rapid growth of electronic shelf labels, which represents a significant and fast-expanding segment of the overall inventory management market. While all three segments of inventory management – stock level monitoring, warehouse management systems and electronic shelf labels – are important, electronic shelf labels are particularly significant within inventory management because the market operates at massive scale. By 2034 it is expected to hit almost 5 billion devices.
This blog primarily focuses on the reasons behind the growing market potential of ESLs. We first explore the key drivers behind the adoption of electronic shelf labels and then examine why the market is experiencing a sudden surge in growth.
The global market for ESLs continues to grow as businesses find ways to handle high inflation, improve in-store operational efficiency, and reduce labour costs, helping them protect margins amid rising manufacturing and logistics expenses. One of the main drivers of adoption is their ability to automatically update pricing and product information in real time, eliminating the need for manual labelling and reducing human error.
Beyond pricing, ESLs help optimise inventory management, improve shelf availability, and enhance the overall customer experience. ESLs also provide real-time information on product availability and location, allowing for reduced inventory, out-of-stock situations, and waste, as well as improved on-shelf availability and merchandising compliance. The displays can also be used to deliver a greater variety of product information, customisation, and advertising.
ESL devices are even more effective when integrated with stores’ ERP, POS, inventory management, and other systems to enable dynamic pricing to respond to market changes and promotions.
The graphic below summarises the drivers.
There is also increasing awareness of how these solutions can drive efficiency well beyond traditional retail environments. While dynamic pricing is often the headline use case, the technology offers a much broader set of benefits that can deliver meaningful operational improvements across multiple industries. For example, in manufacturing and logistics, ESLs can improve picking efficiency, inventory accuracy, and employee productivity. Bosch, Volkswagen, DAU D&D, and Samsung are some examples of companies that have deployed ESLs in their manufacturing and warehousing facilities. Samsung deployed LED blinking ESLs in its facility for real-time inventory accuracy in its warehouse and VW Group has installed SOLUM ESLs in several facilities, including its Dresden plant, Volkswagen HQ in Wolfsburg, and other plants in Europe and the US. The ESLs aid employees to easily find their desired location. In healthcare settings, ESLs can support pharmacy inventory management, or compliance updates. In clinical and pharmacy environments, digital labels enable rapid updates to medication information, storage requirements, and expiry dates, reducing the risk of human error and supporting regulatory compliance. Although deployments outside retail remain relatively limited today, adoption is beginning to pick up, and given the scale and performance seen in retail, the long-term potential points to very large device volumes across these adjacent markets.
The adoption of ESLs is accelerating faster than initially expected, both across new industries and in new geographies. Europe continues to remain a core market, but in the past couple of years growth has been defined by rapid expansion into additional countries. In Europe, France, Belgium, and Scandinavia (particularly Norway and Sweden) have seen widespread adoption of ESLs, which was driven by high labour rates. As per Pricer, one of the leading providers of ESLs, 70% of all shelf labels in Norway are electronic.
More recently, the UK and Italy have come out as strong examples of countries driving the growth, where deployments are now moving to nationwide rollouts. For example, Morrisons, one of the UK’s largest supermarket chains, plans to roll out 10.8 million smart electronic shelf labels across its 497 stores starting early 2026. In another example, Co-op has already installed ESLs in 1,500 stores and plans to expand this to all 2,400 locations by the end of 2026. This would be one of the largest ESL rollouts in Europe.
Beyond Europe, the US is emerging as a major growth engine with significant long-term potential. Adoption is moving beyond early stages and into scaled deployment, starting with Walmart’s implementation of digital shelf labels in 2,300 stores by 2026.
When retailers of this size of Walmart commits to the implementation of a technology such as ESLs, the impact on the market is immediate and substantial. Growth in ESLs does not always appear linear, because deployments can move extremely quickly once a major retailer decides to roll out at scale, as seen in the case of Morrisons, Co-op and Walmart. As a result, market expansion can seem sudden, with sharp inflection points rather than gradual, incremental change.
For this reason it is unsurprising that we have needed to revise our forecasts for the space. The total number of Electronic Shelf Label connected devices will grow from 1.2 billion in 2024 to 4.9 billion in 2034, at a CAGR of 15%.
In summary, electronic shelf labels are gaining momentum due to their ability to cut labour costs, improve operational efficiency, optimise inventory management, and enhance the customer experience. Beyond these steady drivers, the market’s nature — where large-scale deployments by major retailers can happen suddenly — is amplifying growth. Expansion into new geographies and sectors is further accelerating adoption, making ESLs one of the fastest-growing segments in inventory management today.
