RFID and IoT Are on the Same Wavelength: Creating Retail Efficiencies

Artificial intelligence and computer vision are changing how retail stores use RFID. Brick-and-mortar stores are using the technology to create touchpoints with customers, increasing sales while decreasing interaction with employees.


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Image credit: Century

Everything old is new again, and that’s particularly true of radio frequency identification systems. The technology emerged years ago, and it’s gaining renewed attention, especially in retail store and supply chain environments. RFID technology has become more accurate, manufacturing is less expensive, and companies and consumers seek contactless interactions. It’s the trifecta.

In the past decade, analysts at McKinsey & Co. note that the cost of RFID tags and RFID readers have plummeted about 80 percent and 50 percent, respectively. At the same time, the read accuracy has doubled, and the range has expanded more than five times, so stores can deploy RFID systems with fewer devices and get better coverage. In fact, the Asia-Pacific RFID market is projected to grow at an annual rate of 16 percent, reaching $7,311.27 million by 2028. North American projections are lower, with an annual growth rate of 10 percent.

RFID Simplifies Inventory

Retailers typically deploy RFID systems to track inventory, and IoT integration is increasing visibility in store and through the supply chain. Clothing can be tagged at the manufacturer and a single RFID tag on the outside of the shipping box can identify every item of clothing, including the size, color, and quantity, within it. That’s less scanning on the shipping and the receiving end, plus it’s faster and more accurate.

To do in-store inventory, employees scan an RFID device across each row or stack of clothing, and the device can read what remains on the shelves, racks, and in the stock room. RFID systems also prevent theft, or shrink. The RFID tags on unpurchased items automatically set off the security system when a person exits, even if the item is tucked in a bag or purse. Similar technology can be placed in fitting rooms. According to a McKinsey report, RFID improves inventory accuracy as much as 25 percent, making brick-and-mortar stores viable competitors to online stores.

Customer Connections

As an inventory tracking system, RFID shines. Add artificial intelligence and retailers can use RFID as a sales tool to boost customer engagement and extend customer service. These cloud-based platforms also support data analytics.

One example comes from Hangzhou Century, which has developed an RFID-based retail solution that integrates the inventory, smart checkout, and loss prevention systems with a “magic mirror.” The mirror has AI-based capabilities that can provide consumers with product information and check availability.

A shopper can bring a clothing item to the magic mirror, and an image of the item will pop up on the mirror. It displays a QR code, additional images, product and size information, care instructions, price, and suggested accessories. Consumers can scan the QR code, which can notify store employees to bring a different size or color. Touch screen buttons allow consumers to access a virtual fitting assistant and to request in-store assistance. If the shopper tries on the item, she can look in the mirror, touch a photo button, and share an image of herself wearing the item. Consumers can also order online from the store.

Check out the Checkout

Century’s RFID system is integrated into the smart point-of-sale system. Customers can put their selected items in a bag or bin, which employees place on the CensPad, a countertop pad enabled with an RFID reader. The RFID system automatically identifies the items in the bin and tallies the total without requiring each item to be scanned individually. On a busy day, that can save time and shorten checkout lines.

Aevistrack has a similar RFID-based smart retail system that integrates the smart tags and readers with its POS systems, which are powered by Intel® Core™ processors. In addition to its POS register, Aevistrack offers SmartTab, a tabletop tablet system that uses RFID for quick checkout and product returns. The tablet system can support contactless self-checkout, increasingly popular amid the pandemic.

AI and computer vision are breathing new life into RFID systems as retailers seek cost effective ways to increase customer engagement and revenue.

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