Friday, July 16, 2004

Will RFID Spark the Next Revolution in Retailing?

The Wharton site requires registration but does not cost anything. RFID is a technology I have been watching. Remember the Tom Peters' rule from below: the technology is useless for the first 5 years. RFID - radio frequency identification tags are starting to generate a buzz. Wal-Mart is laying on a big push. The dream scenario that we have been hearing about for years is that every item in the supermarket will be tagged. We won't have to wait in a checkout line anymore. Nor will we have to use the self-service lines which I can never seem to navigate through and I consider myself a reasonably tech-saavy guy. Scanners will "read" everything in your cart, you will be direct billed to your debit account, and away you go to soccer practice.

The market seems to be letting Wal-Mart and Target work the kinks out of the system. Costs for tags are still too high. Scanning technology isn't where it needs to be yet. But it will be. Forrester analyst Christine Spivey Overby says:

One of the biggest barriers to making RFID work is figuring out how to manage the data.

The amount of data that can be generated from these tags from ALL stops in the supply chain is staggering. The economic impact will be interesting to watch. If I am a large retail store my inventory costs just got cut. I can get very close to just-in-time delivery. As a consumer, my refrigerator will be able to link to the grocery store and have my basic, week to week items ready for me to pick up. I won't have to get out of my car.
I saw a link the other day and didn't save it where there is talk of putting RFID tags into children. Lojack for your kid. Not sure how I feel about that but this isn't the forum for my Big-Brother-Let's-Suspend-The-November-Elections rants.

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