New era of RFID electronic tag application in retail industry


RFID electronic tag is not a new technology. In fact, the origin of RFID electronic tags can be traced back to the Second World War, when the air force needed a method to distinguish friendly aircraft from enemy aircraft.

Then, covid-19 broke out. Many retailers are forced to temporarily or permanently close down, and the requirement of social isolation makes the in store experience more complicated. Now RFID electronic tags have made progress and expanded in some application fields, and are ready to help retailers create a new era of customer shopping experience.

According to McKinsey, this new era is likely to boost the economy and promote growth, while reducing the cost of inventory labor by 10% to 15%.

As the industry adapts to new customer expectations and more demands for Omni channel experience, retailers have the opportunity to adopt this old technology and use it in innovative ways.

The latest development of RFID electronic tags brings opportunities

RFID electronic tags require four elements to work together: RFID tags, readers and antennas, supporting software, and testing and verification. In recent years, there has not been much change in these elements, because the basic technology behind the system has been stable.

However, some recent developments have made RFID electronic tags more attractive to enterprises. First, according to McKinsey, the RFID performance has been significantly improved in the past decade, the reading accuracy has doubled, and the reading range has also increased fivefold.

Another major change is cost. In the past decade, the average cost of RFID electronic tags has decreased by 80%, while the average cost of RFID readers has decreased by nearly 50%.

These enhanced features mean that enterprises can operate with fewer tags, and the lower price means that the technology is more affordable.

How RFID electronic tags are used in operation

As retailers rely on more interconnected and mobile infrastructure, RFID electronic tags have many advantages in operation. As enterprises shift to Omni channel mode, inventory may be a major challenge. This is also one of the most prominent applications of RFID electronic tags: to help track inventory.

This can also help enterprises identify consumer trends and preferences, so that enterprises can adjust production according to needs.

RFID electronic tags can also help simplify store operations through self-service checkout and other application cases, make checkout faster and more accurate, and reduce labor hours and error rate. It also allows shoppers to scan goods with their smartphones and pay immediately. With RFID electronic tags, it is easier to return goods. RFID tags eliminate potential inventory tracking problems and errors in the reverse supply chain.

How RFID is used for customer experience

At present, inventory tracking and operation are the most widely used RFID electronic tags in the retail industry. However, with the development of customer expectations, other emerging use cases have emerged.

One of them will affect one of the most commonly used parts of the store: the fitting room. RFID allows the smart mirror to read the labels on the clothes and prompt suggestions on relevant styles and accessories. It can also collect data about customer interest and try on to help inform orders and other operations.

However, this is not the only customization function that RFID electronic tags can provide in the retail industry. When some products are interconnected via technology, the technology can provide unique recommendation functions, enabling customers to browse in a more participatory and personalized manner. These uses are still emerging, but these non-contact experiences are becoming more and more popular.

With the right RFID electronic tag tools, retailers can take the lead and serve customers. For decades, RFID electronic tags have been proved to be useful for various industries. As retailers move to Omni channel sales, this technology plays a greater role.
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