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Is This the Year RFID Takes Off?

Adoption in retail is moving inexorably toward the tipping point.
By Mark Roberti
Jan 10, 2017

Every year, I write about what I think the year ahead holds for the radio frequency identification industry. For the past few years, I have said that I thought adoption, particularly in the apparel retail sector, would continue to pick up, but that this was not the year in which RFID would finally hit the tipping point and accelerate dramatically. But this could be the year.

Geoffrey Moore, the author of Crossing the Chasm and other books about the technology adoption lifecycle, wrote that five conditions must exist for a new technology to take off. First, there must be a problem that no other technology can solve (or solve cost-effectively). That is certainly true for apparel retailers—all have a critical problem managing their inventory (though many don't admit it to themselves). Inventory accuracy at the stock-keeping unit (SKU) level is about 65 percent. RFID can get it up to 95 percent or better.

There must be a global standard. For apparel tracking, all retailers are using passive ultrahigh-frequency (UHF) RFID.

There must be whole product, or integrated solution. We have a growing number of companies adding software to their hardware solutions, and more hardware and software companies partnering to provide a whole product.

Finally, there must be a critical mass of end users adopting the technology, and there must be a "gorilla" that the market can embrace. A gorilla, in Moore's parlance, is a dominant technology provider. Examples would be IBM in the PC space and Apple in the smartphone market. We don't quite have a gorilla for radio frequency identification. The market hasn't chosen one particular RFID provider or a group of providers. And we haven't quite reached a point at which enough retailers are adopting RFID to make it necessary for all retailers to quickly do the same. But this could be the year when one player stakes its claim to gorilla status and enough companies adopt to tip the market toward mass adoption.

Timing is always difficult to predict. I have been looking at 2018 as the year in which RFID will hit the tipping point in retail apparel, but it could happen this year. And if it does, that will encourage other industries to embrace the technology.

Mark Roberti is the founder and editor of RFID Journal. If you would like to comment on this article, click on the link below. To read more of Mark's opinions, visit the RFID Journal Blog, the Editor's Note archive or RFID Connect.

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USER COMMENTS

Clark Ferguson 2017-01-12 11:54:16 AM
Isn't this what we were asking last year at this time, and the year before, and...... Yes, the move toward a more ubiquitous adoption is occurring, but the pace has been and I am afraid continues to be agonizingly slow. I am encourages by the advancements in the retail sector. That may be the catalyst to shift the industry into high gear. After all, it was the push in retail supply chain by Walmart in the US and Metro in the EU (among others) that supplied the impetus in the early 2000s. Let's cross our fingers that this new movement will be sustainable.
stanton kaye 2017-08-27 07:07:30 PM
Mark, A perfect storm is gathering buried in your writing: I see that out-of-stocks computer monitoring together with block chain-like Perishable monitoring certitude of end dates --(and ,therefore, better waste management )--can come together in retail, supply chain and customer services that are married. Predictive analytics are a quality benefit but so are reduced personnel and better efficiencies.They all say bottom line ROI in newer rising high motivating management numbers.But to really thrive management has to share the new jobs also created as it retires the older positions with a community perspective . Otherwise the outcome is a disaster like the current fiasco of our short sighted management in the executive U.S. government . We are what we eat after all!

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