In a recent episode of The Big Bang Theory, the studio audience had a good hearty laugh about a character’s use of RFID – tagging, scanning, and tracking every item of his clothing – to “simplify” the process of packing for a weekend trip. Though we shared in the laughter as Sheldon happily takes only three hours and eleven minutes to enable himself to track the distance to and weather conditions around each pair of his socks, one question does come to mind: just how far-fetched is the idea of everyday RFID use for consumers?
While the sitcom character is making an exaggerated and absurd use of the technology, finding it necessary to explain step-by-step the elaborate system he’s created, the truth is that RFID has become so integrated into our society that most people don’t even realize just how much they benefit from it. In fact, if on a typical day of errands, you drove your child to a doctor’s appointment, swung by the public library, and treated yourself to a little shopping, you could encounter RFID at every stop along the way. RFID in your keys gets you into your car. RFID in your toll pass keeps you moving along the highway. RFID in hospitals tracks your son or daughter’s medicine. RFID in library cards tracks the books you’ve checked out. RFID in clothing tags tells retailers if your favorite styles are in stock (they should be, with the technology uniting the supply chain as well). And the list goes on.
However, if you were ever to strike up a conversation with someone about how cool and useful RFID is, you would get a lot of reactions eerily similar to that of the character’s roommate in the The Big Bang Theory clip. But perhaps that is a testament to just how effective RFID is as an integrated technology. It’s becoming so pervasive that people don’t realize it’s been making their lives easier and will continue to do so on much broader levels as it gets more widely adopted by both businesses and consumers. So while our friends from The Big Bang Theory continue their back-and-forth (and somewhere, someone plays the laugh track on repeat), the reality is that RFID typically isn’t even part of the conversation – it’s in the background simplifying data collection and enhancing processes so we can concentrate on our everyday activities.
As a Vermonter, I've been a long time Phish fan and I was excited to hear the recent announcement that the band would be part of the Bonnaroo Arts and Music Festival event this summer in Tennessee. As a technology marketer, I was even more excited when I discovered that Phish found a clever way to use RFID for its merchandising activities. But that shouldn’t surprise anyone who is familiar with the band. They are a very creative group.
As you may know, the band established a non-profit called WaterWheel Foundation whose mission is to raise funds for a non-profit organizations in each community in which Phish plays while on tour. They do this through donations and through selling t-shirts, hats, sweatshirts and other "dry goods".
At each show, WaterWheel volunteers unpack hundreds of items. The volunteers count each item, keep tally on paper, and then place them on display. At the end of the show, the merchandise is counted again, written down again and re-packed. Based on the counts, the volunteers order additional merchandise from its warehouse to be added to the inventory, which ships to the next tour location. We don’t have to spell it out for our readers. That process, as we know all too well, leaves a large margin for error. Not to mention extremely tedious and time consuming.
It turns out that Zander Livingston, founder of our partner, Truecount, is as big a Phish fan as well! To launch Phish's RFID use, Truecount donated the TC Mobile Merch RFID solution to the foundation to help improve its inventory process. Truecount and the WaterWheel volunteers would commission an RFID tag by linking an item's SKU number with the Electronic Product Code (EPC) number encoded on that tag. At the end of a each show, the merchandise booths were taken down, the RFID tags were read again. Volunteers could use the results from that final inventory scan to determine if and what additional items were needed at the next show venue.
RFID Journal reported that the inventory task can be accomplished within 10 to 12 minutes, instead of the two and a half hours it took without RFID. Matthew Beck, WaterWheel Foundation's touring director, told RFID Journal that he hopes the RFID technology might "stabilize the variables," and improve the accuracy of inventory counts, as well as save time.
Matthew, have no doubt, with RFID, you can accomplish just that.
Beyond the Right product, at the right place, at the right time...
RFID in retail has demonstrated major business benefits in the way of streamlining the supply chain, which leads to reduced costs and enhancing the customer experience - resulting in increased and recurring sales. All good for a thriving business, which is probably why Macy’s and Bloomingdale’s have recently taken a stronger stance on their RFID deployment plans.
Last week it was reported that Macy’s is embarking on a widespread adoption of RFID. This is very exciting to those of us who have been supporters (and developers) of RFID since its infancy. Macy's will be one of the first retailers to implement RFID on a broad scale. Next year, the company plans to be using RFID in all U.S. stores to track items that are regularly stocked and automatically resupplied as they are sold to customers. These “replenishment goods,” which include men's furnishings, intimate apparel, men's pants, denim and women's shoes, make up about 30 percent of its sales. One can deduce that Macy’s expects that number to grow based on its investment in RFID.
According to Tom Cole, Macy’ chief administrative officer, the goal of the project is to help them ensure they have the right product, in the right place, at the right time for their shoppers. It would seem like a simple notion, but there are many variables in retail that make that a difficult task. But, RFID can replace some of those pesky variables with the desired constant.
From the Supply Chain to the Fitting Room
RFID is improving the retail experience outside of supply chain enhancements as well. Recently, ThingMagic UHF RFID readers were featured in a Musical Fitting Room video to show the powerful combination of music, fashion and RFID. It’s a great concept. The idea is to appeal to the individual shopper by playing music that resonates with them, then sending them an SMS with the name of the song and a link to download it for free on StarHub.com.
To make this work, the clothing items have RFID tags applied to them that, when brought into the dressing room, trigger a song that matches the ‘mood’ of the clothes. The project coveres 16 genres and more than 10,000 songs to encompass all ages and types of shoppers.
With RFID, retailers can count and track item-level inventory much easier, faster and accurately. A very important part of the equation solved. Once you have that part of the equation, you can arrive at “right product, right place, right time” answer. And who doesn’t like getting the right answer all of the time? Now, with a soundtrack to boot!
From tracking product recalls to PI accuracy to electronic proof of delivery and everything in between
When we investigated and highlighted 100 unique uses of RFID on this blog, we came across many interesting, successful applications in the retail industry. Previous posts on RFID in Retail demonstrated how the technology has the ability to streamline operations and improve the customer experience, all while helping to boost the bottom line of retailers.
Equally interested in identifying uses of RFID in retail, The University of Arkansas Information Technology Research Institute (ITRI) embarked on a study that zeroed in on item-level tagging for supply chains in the apparel retail industry. The study, “An Empirical Study of Potential Uses of RFID In The Apparel Retail Supply Chain,” highlighted 60 business cases that span from plan-o-gram compliance to perpetual inventory (PI) accuracy to product recalls.
According to the executive summary, the study represents Phase I, which was to identify potential business cases for the use of RFID in an apparel supply chain. Key findings of this phase show the potential benefits of item-level RFID to include:
- Improved backroom-to-shelf replenishment and greater perpetual inventory (PI) accuracy have the potential to increase top-line sales, due to higher product availability at the retail shelf.
- Substantial reduction in labor costs, the largest percentage of variable costs, are achieved by improving inbound and outbound operations, decreasing the number of touches by staff per carton.
- The ability of apparel manufacturers to audit the contents of each carton being shipped through an automated process, result in fewer deductions or chargebacks from the manufacturer’s retail customers.
Summing it up nicely, an RFID Journal story indicated that the biggest take-away from the study is the extent of RFID’s reach because it touches every aspect of the supply chain. That spectrum of RFID’s ability is evident in the number of use cases in that market segment alone.
Still not convinced that RFID in retail is on a path to significant growth? Consider these recent headlines:
ABI Research: Global Apparel Markets Will Use 1 Billion RFID Tags in 2011
Truecount CEO Zander Livingstoon Predicts Retailers will Accelerate Rollouts of RFID in 2011
And just today, organizers of one of the RFID market's largest technology & solution focused events, announced this years' RFID Journal LIVE! will shine the spotlight on an apparel and supply chain focused showcase: RFID Journal Announces Live RFID-Enabled Supply Demonstration
We’ll be anxiously awaiting Phas II of the ITRI’s study, which will involve the measurement of ROI for select use cases identified in Phase I. Phase II is sure to bring about more compelling proof that RFID should be an integral part of the retail supply chain.
Please let us know your thoughts about the use of RFID in retail.