RFID technology is so much more than fashion
Date: December 14, 2017
Category: Industry news
Steven Fifer, PR and Communications, shares his insights after attending his first RFID conference for GS1 UK
As a new member of staff, I am still getting to grips with the world of GS1 standards. None more so than in the world of RFID technology.
RFID or radio frequency identification uses radio waves to automatically identify and track tags attached to items. It has been embraced by the retail sector as a way of improving inventory management by radically streamlining the process of counting and locating stock.
In terms of our role, GS1 has developed the industry standard for RFID known as EPC which has been adopted by most RFID users today.
Sounds interesting but I wanted to know more. So when I was invited to attend the RFID Journal Live! Europe conference, I took the opportunity with both hands as this was a great way to learn all about RFID technology.
And what I took most from the day is that RFID is so much more than helping fashion retailers to manage their stock levels, albeit this remains an important function.
Looking beyond fashion – RFID in aerospace and oil rigs
The day kicked off with a fascinating presentation from Basil Jeffers, a Lead Parts Engineer for NASA. Basil explained that the US-based Aeronautical agency was using RFID technology to assemble a large infrared telescope.
Not normally the home of RFID but NASA has been using the technology to track the status and location of each component on the telescope, leading to increased efficiencies and reduced labour costs.
Basil also told the audience that he has also been using RFID tags on his golf balls, helping him know where the ball landed and how far he hit it. Although I cannot remember if Basil said it improved his score!
Euan Murdoch followed Basil, a product line manager for a large oilfield services company – Weatherford. In another example of how RFID technology is being used beyond fashion, Euan went through the complicated process of extracting oil from the ground.
He then went on to explain RFID tags are sent underground to better manage tools to improve efficiency, such as managing the optimum time to open and close valves.
If tools way down in the earth’s crust are performing more efficiently, Euan explained that RFID therefore helps to reduce the amount of people on-board oil rigs to maintain the tools. This saves money and reduces risk to workers as an oil rig is not exactly the safest environment.
How retailers are using RFID technology
During the second half of the morning session, the audience was split into two. Those of us who were more interested in how RFID is being applied in fashion, got to hear from leading national retailers and suppliers that are using this innovative technology.
M&S first adopted the technology six years ago to broaden and deepen their understanding of how to improve stock efficiency. Having kicked off the programme by using RFID tags on two-piece suits, Richard said that the biggest lesson the iconic British retailer learnt is that RFID helps you know what you really have – as opposed to what you think you have.
Staff buy-in was also important as Richard explained that his colleagues had to be comfortable using the technology. v And while M&S haven’t necessarily seen a lift in sales figures, Richard explained that RFID was more about delivering the “right product, in the right place at the right time”. This enables M&S to clear stock from the Distribution Centre quickly to the stores that need it – and more importantly at full price.
Jack Wills’ Gary Tattersall then put forward his company’s experience RFID to the attentive audience. One of the newer high street brands, Jack Wills adopted the technology to improve efficiencies in their stock checking procedures.
The British retailer found RFID technology easy to use, they were able to boost inventory accuracy to 95% and even saw an uplift in sales – which got their board excited. RFID has proved so successful that Gary said other departments want to adopt the technology and there are plans to introduce RFID in their Distribution Centers.
Anja-Maria Sonntag from River Island then held the platform where she waxed-lyrical about RFID after the technology helped the fashion retailer improve stock accuracy.
River Island had experienced problems with stock accuracy in their stores, despite staff’s confidence that all stock could be accounted for. After some small trials, RFID helped River Island improve stock accuracy from 74% all the way up to 97%.
But in a key move, River Island took the new technology away and guess what happened – stock accuracy levels dropped back to 72%!
This was all the evidence the fashion retailer needed and since June 2017 when River Island trialed RFID in 37 of their stores, Anja-Maria promised that RFID is now in all 300 plus stores across the country.
Using RFID, weekly counts now take an hour instead of half a day and Anja-Maria said the technology was easy to implement alongside current systems. Stock accuracy is up to an impressive 97% and most importantly – improved availability has led to positive customer feedback and happier staff.
Intellectually speaking: making the academic case for RFID
The afternoon took a more academic approach to explaining why retailers should adopt RFID.
Dr Bill Hardgrave, Dean & Wells Fargo Professor, Auburn University, spoke about how the world of retail is rapidly changing with more businesses embracing omnichannel sales strategies. So instead of treating each sales channel differently, i.e. multi-channel, businesses are seamlessly integrating all sales channels so that the customer has the same experience whether they shop in-store or online.
But for retailers to deliver this new approach, they need to embrace new technology – especially RFID.
Dr Hardgrave explained that in the omnichannel world, inventory accuracy is the “glue that holds everything together”. Conversely, if it fails, it affects every aspect of the omnichannel experience.
Using examples from several national retailers, Dr Hardgrave described how without accurate inventory records retailers are unable to successfully deliver key omnichannel processes. Offers like ‘fulfill from store’, ‘buy online pick up in store’ or revealing store stock levels to your online customers rely on up to date stock records shared across your supply chain.
39% of retailers are now using RFID in the United States and while he admitted RFID is one solution among many, Dr Hardgrave said it is the best technology for improving inventory accuracy.
The final session was delivered by Professor Antonio Rizzi of the RFID Laboratory, University of Parma, who demonstrated how retailers can improve sales through RFID-empowered visual merchandising.
As consumers often purchase items on impulse through visual stimulation visual merchandising plays a key role in engaging customers and encouraging sales.
Using a complicated statistics model, Professor Rizzi explained that data gathered from RFID can help retailers determine the success of an item dependent on what was displayed, where it appeared in the store and how it was displayed.
And once retailers knew this, they could then adopt future sales tactics to really ensure value for money.
Lessons learnt from RFID Journal Live! Europe conference
Walking out of the conference, it was evident that RFID has some amazing applications and these stretch far beyond just being used in clothes tags. From tracking components being used to build huge telescopes and helping to maintain equipment on oil rigs to aiding stock accuracy, RFID can help organisations improve performance, reduce costs and improve customer satisfaction.
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