Have retailers really opened their doors to RFID?

What drives a retailer to adopt this technology? And what holds it back?

Let’s start with the numbers: in 2018, Accenture published a study from a Kurt Salmon Associates survey of 110 global retail executives.

Surprising results, but not too surprising for those in the industry: 69% of respondents cited a significant level of RFID adoption. We already have a first answer: the increase in use cases worldwide convinces the various competitors more than any return-on-investment data. But that’s not enough, there are other insights in the motivational top chart:

• Spasmodic search to meet multi-channel needs
• Improving the customer experience
• Accuracy of stocks and inventories

The benefits of RFID solutions

Omnichannel

85% of the retailers surveyed offer at least one omnichannel purchasing method for their customers, and the biggest management costs are in organising shipments, especially when warehouses are in widely separated locations. It sounds trivial, but fragmenting shipments has a huge cost, increased exponentially by free returns.

Well, RFID finds one of its greatest expressions exactly in the constant monitoring of one’s own stock. Knowing where my products are at all times allows me to pass on this invaluable information to the customer: ‘Dear customer, check from home if the product you are looking for is in that shop, or order it online and pick it up wherever you like‘. I will always remember this phrase as a mantra: ‘an item that is not on display is a non-sale‘.

Too bad, the RFID system would have told you in time, dear Store Manager!

Customer Experience

Directly linked to the previous point, RFID is helping retailers fight the online sales horsemen. It is a paradox because they themselves have had to transform themselves like their ‘enemies’, but in a different way, making traditional selling a kind of augmented reality of buying. Layers of additional information enrich our purchases, just with the help of a little electronic label.

And let’s not be enchanted by the super-fast checkouts where shop assistants literally throw our sporting goods onto magic baskets. That is the simplest and most immediate thing, but behind the scenes there are complex systems that control the flow of my item from its inception to sale, perhaps even guaranteeing its authenticity.

Stock and inventories

It is perhaps the most complex but at the same time the most spectacular aspect, the famous price that is worth the ticket.

Have you ever seen a shop manager observing the stock of his shop for the first time in real time? Without waiting for rough nightly reports? He has a beautiful face. What about replenishment clerks without counting items one by one and wandering hours in the warehouse? Rejuvenated by five years. And I won’t mention the higher levels where thanks to a BI the monitoring of sales, stock and transfers becomes much more immediate.

A note regarding the accuracy of the data before and after RFID. We go from an average of 60% up to peaks of 98%. This means always knowing how many items I have in the shop and how many of these are on display and how many in stock. It means not having to commit resources for days ‘firing’ barcodes, or deciding to inventory only part of my items, having my ERP make rough projections.

Yet all this seems not to be enough, alas especially in Europe, at the bottom of the list of RFID retail lovers. We are the ones lowering the percentages mentioned above, to be clear, we are at 30% adoption against 92% in the USA.

Large margins for growth then, but above all a great deal of convincing on the horizon, ROI in hand.