Tiny screens, big pricing power

Editor’s note: This article first appeared in Money Matters, a newsletter from Britannica Money, on May 24, 2026.

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Are sticker prices about to be a thing of the past?

© Roman Samokhin, grey/stock.adobe.com; Photo illustration Encyclopædia Britannica, Inc.

There was this old-time diner in my hometown—you probably had one, too—that felt frozen in time. Same decor, same wait staff, and the same menus with the same prices, year after year. Sandwich platters, $5.49. Bottomless cup of coffee, $1.29. I used to joke that it was one of the great paradoxes of our time: The owners were too cheap to print the new menus that would raise their profit margin.

Those were the days, I suppose (but they weren’t that long ago). For most of modern retail history, changing prices has been a hassle. Restaurants had to reprint menus. Gas stations had to manually change the prices on the pump. And grocery workers had to swap out paper shelf tags by hand. In other words, prices moved, but not constantly. 

Digital price tags—those little electronic shelf displays that can update prices automatically—are the latest evolution in so-called dynamic pricing, and they could change the way prices move in retail stores.

The market has always moved prices. If you’ve ever taken Econ 101, it was probably one of the first concepts covered: supply, demand, and the equilibrium price where buyers and sellers meet. In the trading world, we call it price discovery—the continuous process through which markets absorb information and settle on a price. But in many ways, dynamic pricing dates back to the ancient bazaar, where prices were typically negotiated in real time rather than posted on a fixed sign.

In other words, dynamic pricing itself isn’t new. Markets have always adjusted to changes in scarcity, demand, competition, and consumer behavior.

The economics behind dynamic pricing may date back to the earliest marketplaces, but the systems that power it have evolved dramatically over the past two decades.

Some of that evolution has happened in software; some in hardware. Together, they’ve made it possible for retailers—online and at the point-of-sale—to change prices faster, more frequently, and with far greater precision.

Again, none of this is entirely new. Airlines and hotels have used versions of dynamic pricing for decades, while companies such as Amazon, Uber, and Live Nation/Ticketmaster have turned algorithmic pricing into a core part of their business models. I’ve also experienced the strange sensation of searching online for a flight or hotel room, only to see the price rise on a second search. Did inventory actually change, or did the algorithm respond to perceived demand?

Until recently, much of this pricing tech lived mostly online. Now, cheap digital displays—essentially small LCD or e-ink screens—allow stores to update prices instantly without sending employees down the aisles to replace paper tags by hand.

I’ll admit I’m conflicted about all this.

As an unabashed free-market capitalist—and a former market maker—I understand the economic logic behind dynamic pricing. Prices aren’t just information—they’re an efficient form of resource allocation.

Think about batteries before a tornado or bottled water before a hurricane. If prices stay artificially low, the first shoppers through the door will clear the shelves long before the people with the greatest need arrive. Remember the early days of the pandemic? We probably would have had enough toilet paper and disinfecting wipes to get us through the transition, but because of early hoarding, the shelves couldn’t stay restocked.

But there’s another side to the equation. Markets work best when people believe the system is broadly fair, transparent, and competitive. As digital price tags, algorithms, and consumer data make prices more adaptive—and potentially more personalized—it’s fair to wonder whether markets are discovering prices or simply discovering the maximum amount each of us is willing to tolerate.

That may be the real question raised by digital price tags. Not whether dynamic pricing works, but how much dynamic pricing consumers are willing to accept before the retail social contract begins to change.