Kimberly-Clark Gets an Early Win

Retailers usually scan bar codes on displays when they are received into inventory at the back of the store. Most don't share any data with their suppliers, so manufacturers don't know if or when a promotional display arrived. But even if retailers provided that information via a secure extranet, suppliers have no way of knowing whether the displays are sitting forlornly in the back room or are being showered with attention from consumers in a highly trafficked area of the store.

K-C uses a retail business services company called Crossmark to conduct random checks at stores to confirm that displays and product have been merchandised properly (that is, brought out to the store floor and positioned correctly). When Crossmark representatives don't find the displays on the floor, they can alert the retailer to bring them out. But this spot-check approach has its limits because the merchandisers can't hit every store or check on every SKU.

RFID is helping manufacturers and retailers avoid losing out on potential sales.

K-C's brain trust realized that RFID could add a new level of visibility. If a store had an RFID infrastructure—interrogators installed at the back of the store and between the back room and the retail floor—K-C could tag displays and, using the data supplied by the retailer, see in near-real time when the displays arrived at the stores and were brought out to the floor.

In 2005, K-C ran a couple of pilots in which it mailed tags based on EPCglobal's Electronic Product Code standard to a contract packager assembling and packing displays, and had it apply the tags to the displays. But some of these tagged displays never showed up in the data supplied by the retail partner, perhaps because the tagged displays went to a store without RFID interrogators. K-C could have solved the issue by routing the promotional displays to a K-C RFID-enabled distribution center, where it could encode and apply the RFID tags and then track them as they were sent to the retailer, but that would have been inefficient and incurred additional shipping costs.

Another challenge was K-C didn't have effective processes or robust RFID data analytics software for analyzing the RFID data it was getting back from its retail partner. "We were collecting read data and dumping it into Microsoft Excel and then doing our own analysis of how well we executed," says Therrien. "Once you got past 10 to 15 stores, it got a lot harder to manage the data."

K-C solved that issue by turning to software provider OATSystems, which had developed applications that use RFID data to drive business value. K-C purchased an enterprise license for OATSystems' OATaxiom and OATxpress applications. "That software platform was put in place in 2006," says Therrien. "It really started to mature and meet our needs as our retail partner scaled up the number of stores with the RFID infrastructure."