The ‘90s aren’t just back in the form of plaid flannels and wide-leg cargo pants. For retailers everywhere, the past few years have seen a resurgence of RFID as the solution to many of their most pressing challenges. Need more accurate inventory tracking? RFID. Customers want seamless self-checkout? RFID. Theft levels constantly on the rise? RFID.
An Accenture study revealed that 93% of North American retailers have recently been using or piloting RFID. This is a drastic increase from 34% in 2014. And since the start of 2022, several prominent retailers, including Walmart, Target, Macy’s and Nordstrom, have instituted RFID tag mandates for their affiliated partners and suppliers. The notable surge in RFID adoption within the retail sector prompts the question: What factors are driving this seemingly sudden growth in RFID utilization within the retail industry? And, perhaps more importantly, are the retailers adopting RFID using it effectively?
Over the past two decades, RFID technology has experienced notable enhancements in readability, range and affordability. The typical cost of an RFID tag has seen a remarkable reduction of 80%. RFID readers have dropped in price by over 50%. And at the same time, read accuracy has more than doubled, and the operational range has quintupled.
Plus, the timing is just right. RFID technology now stands ready to cater to the specific use cases that most often occupy the minds of retail executives everywhere, in every sector: enhanced omnichannel capabilities, data-driven operations, real-time merchandising analytics for better planning and allocation, heightened accuracy, and customer-centric shopping experiences.
INFOGRAPHIC: What’s in Store for the Store of the Future?
Achieving ~90% inventory accuracy with RFID technology can absolutely help retailers boost the top line and reduce hourly labor costs. Yet, the jump from 90 to 99% accuracy is significant in terms of profitable growth and overall operational benefits.
Presently, most retailers using RFID depend on scheduled cycle counts (monthly, weekly or daily) to achieve “snapshot” or “point-in-time” inventory visibility. However, many leading brands like COS (H&M Group) have seen that instant or real-time visibility (exceeding 99% accuracy) is the linchpin for an enhanced customer experience and industry-leading operational excellence.
With an AI-powered software platform, retail stores can maximize the value of their RFID investment. A real-time RFID data feed can automatically generate and assign the optimal tasks, layouts, promotions, processes, analytics and insights. The move to real-time inventory visibility and management:
In conclusion, the resurgence of RFID technology in the retail sector can be a transformative solution to critical retail challenges, from accurate inventory tracking to enhancing customer experiences. And while achieving 90% inventory accuracy is valuable, the real magic happens when you exceed 98-99%. Real-time visibility through an AI-powered software platform is the keystone for operational excellence and improved customer satisfaction. It reduces strain on operational bandwidth, empowers store associates, expedites omnichannel integration and enhances adaptability in a volatile supply chain landscape.
So, for retailers looking to make the most of their RFID investment, embracing a real-time platform is the way to provide the sort of innovative, data-driven and customer-centric shopping experiences that will continue to define success in 2024 and beyond.