See how price accuracy, on-shelf availability, and planogram compliance benefit from increased in-store visibility
Executing the basics of retail has never been more challenging. Increased cost and limited availability of labor combined with added operational complexities associated with serving more demanding shoppers are just two of the very real pressures on retail. This puts retailers in a difficult position just as planogram compliance, on-shelf availability of products, and pricing accuracy become more important. These challenges are familiar to retailers, but they have gained intensity and created a new urgency to identify and implement solutions that solve real-world business challenges.
This is especially true in price compliance. Disturbing findings from a new study show retailers are putting shopper loyalty, profits, and their brand reputation at risk by charging incorrect prices at a time of heightened price sensitivity caused by several years of rampant inflation. Approximately 23% of retail locations failed price accuracy inspections in the 2024 National Price Verification Survey, a massive research effort led by the National Conference on Weights and Measures (NCWM) and the National Institute of Standards and Technology (NIST) Office of Weights and Measures (OWM). The study was limited to US retailers, but the issues identified are global.
Why the numbers are concerning for retailers
A 23% failure rate is not good, but there are several reasons why that headline number is worse than it seems. For starters, survey protocols allowed a retail location to pass inspection if incorrectly priced items didn’t exceed 2%. The survey showed that of the 77% of locations that passed inspection 26% still had pricing errors, just not enough to reach the 2% threshold to fail.
Also concerning are the reasons why retailers fail price verification tests. When undercharges to shoppers are excluded from error rate calculations, about 88% of retail locations passed inspection. That is somewhat better news for shoppers, but any amount of overcharges can erode shopper trust and, in some cases, lead to brand reputation damage if aggravated shoppers use social media to amplify their frustrations. Undercharging shoppers is preferable to overcharging, certainly from an optics standpoint, but it’s still not good. Undercharges are a silent killer of retailers’ sales and profits because shoppers were willing to pay the price displayed but were then charged less.
As the study authors noted, “Consumers should not be charged more than advertised, and retailers need to have best practices in place to avoid those overcharges or potential undercharges that cut into their profits.”
The urgent need for innovative solutions
It is hard to make a case that best practices are in place with a 23% failure rate, and some retail sectors have more work to do than others when it comes to price compliance. For example, only 66% of convenience retailers, 71% of dollar/discount stores, and 76% of supercenters received passing grades in the 2024 National Price Verification Survey. Grocers fared better at 83% while the warehouse/club channel, aided by its limited product assortment, had the highest passing grade at 88%. Of the 1,711 (23%) locations that failed inspections, the error rate ranged from 3% to 80%, with the majority (75%) of those who failed falling in the 3% to 10% range.
The findings are based on a study that was unprecedented in its scope, methodology, and the number of organizations involved, including 26 states and 20 city and county jurisdictions. To conduct the price verification inspections nearly 400 volunteer investigators specially trained in procedures to ensure the randomness of item selection visited 7,462 stores across 11 retail channels and purchased 419,237 individual items.
Given the size of the study and its woeful findings, it’s clear there is an urgent need for innovative solutions. When retailers allow poor price compliance to fester, they needlessly put their customer relationships and business performance at risk.
How Store Intelligence improves price compliance
Retailers can’t manage what they don’t measure and therein lies the problem with price compliance. Measurement has historically been a labor-intensive, manual process prone to errors. Even when retailers have dedicated price teams in-store or use handheld devices to scan shelf tags compliance remains a challenge, due to the frequency of price changes or the large number of products available even in smaller format, convenience-oriented retailers.
Fortunately for retailers, there is a better way to measure pricing accuracy in stores than the approach used by study investigators. Advances in AI-powered computer vision and predictive analytics make it possible to quickly identify potential pricing issues thanks to images captured by mobile devices or fixed cameras. Powerful analytics make it possible to quickly determine whether prices are consistent with those in the master item file. If discrepancies are detected, store employees can be automatically alerted with corrective actions prioritized.
Symphony AI calls this innovation Store Intelligence, and it represents a major advancement in the technology retailers can use to monitor price compliance and improve accuracy. Store Intelligence mitigates negative consequences of overcharges, including shopper aggravation and potential fines for repeated violations, and the profit erosion caused by undercharges.
OSA and planogram compliance
Store Intelligence would be incredibly valuable for any retailer even if the only use case was improved price compliance. However, increased visibility of in-store conditions through the magic of computer vision and AI-powered image analysis means retailers can also detect on-shelf availability issues and determine planogram compliance. These benefits are further amplified when Store Intelligence data is integrated with data sources from areas such as merchandising, marketing and supply chain. This seamless connection of data from siloed sources is what SymphonyAI refers to as “connected retail” and it is key to realizing the benefits of predictive and generative AI.
As with pricing inaccuracies, when stock-outs are detected, Store Intelligence can determine whether inventory exists in store and prioritize tasks based on retailer-established rules. Similarly, Store Intelligence can determine whether planograms are compliant by matching images with the intended planogram. It is common for a planogram to appear accurate when shelves are full even though products may be in the wrong location. But even when shelves aren’t full, Store Intelligence can identify improperly located items known as “wanderers” in a way that is virtually impossible for the naked eye.
Store Intelligence is the modern solution retailers have been waiting for to solve their toughest and most basic operational challenges, whether that’s on-shelf availability, planogram compliance, or price integrity.
See how your stores can improve price accuracy, on-shelf availability and planogram planogram compliance with Store Intelligence. Request a demo today!
