Companies Use Active RFID Cards to Improve Customer Service

By Claire Swedberg

Sept. 23, 2008—Westport, Conn., startup company Novitaz has developed an application that uses active RFID tags to help stores, restaurants or banks improve customer service. A bank in India and a Canadian restaurant chain, both of which have asked to remain unnamed, are now testing the system. In the case of the Canadian restaurant, customers are carrying loyalty cards with an embedded RFID chip linked to customer data in the restaurant's back-end system. When diners arrive at the restaurant, the business utilizes data about them to provide more personalized service. In the same way the Indian bank can track those entering its facility, and provide more personalized service based on each customer's RFID-embedded card.

With the system, businesses can access information necessary to target a card-carrying individual with a specific service or advertisement, as well as to analyze how successfully items are displayed in a store based on how long shoppers stop to look at them, and whether they then chose to buy those items.

Suni Munshani

Novitaz's CEO, Suni Munshani, says the company was founded in 2003 on a fundamental question: How do stores acquire the kind of data that Amazon.com and other online vendors gain from their consumers? For instance, how long do customers view specific items, what draws their interest and do they then buy the products they were evaluating?

While online stores know the answers to these questions, physical stores simply do not have that kind of visibility regarding their customers' behaviors. Unless there is a staff presence on the store aisle, Munshani says, retailers have no knowledge of who is in the store, or the items that interest that particular shopper. In fact, the only knowledge they can gain is during an item's purchase. Only then can the store identify a customer, Munshani says. "They can look at your credit card at the time of purchase," he says, "but they have no meaningful way to support you as a shopper except to say, thank you."

However, Munshani says, with improved and more timely data, stores could target the right ads for each customer, just as online vendors do, such as suggesting other products that might go well with those the consumer is considering buying.

To offer a solution, Novitaz reviewed existing technologies, including contactless cards and other types of passive RFID systems, and determined that an active RFID solution would be necessary to properly track consumers' cards. The company's engineers then fabricated the chips, designed the circuitry and antennas, and created all of the hardware to be small enough to fit into a plastic card the size of credit card. The resulting system responds to a low-frequency (125 kHz) wake-up signal from a reader and transmits at 433 MHz using a proprietary air-interface protocol.