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Tracking the RFID Market

RFID Journal is launching a new report to help technology providers and end-user companies better understand the state of the market for RFID products and services.
By Mark Roberti
Apr 28, 2008It was clear from conversations I had with exhibitors at RFID Journal LIVE! 2008, held this month in Las Vegas, that they were surprised by the number of end users at the event, and that so many were serious about deploying radio frequency identification technologies. At prior shows, many attendees were more focused on understanding the technology than on how to use it to solve specific business problems.

I, too, was a bit surprised by the turnout, but not by the seriousness of the attendees. And that got me thinking about why the vendor community often seems out of synch with the market. Many end users don't know what's really happening with adoption, either.

I believe vendors and end users don't have the market insights RFID Journal has, because each sees only a slice of the market. Vendors interact with customers and potential new customers, but have little insight into the broader market. If a company that sells tags, readers or software has customers in the retail, consumer packaged goods and agricultural sectors, it doesn't necessarily know what opportunities might exist in the pharmaceutical, apparel and chemical sectors. Moreover, a firm's customer base in one area might represent only a thin segment of that sector.

End users tend to focus on what they read, and articles in the mainstream press can be highly misleading. For most of 2007, for instance, the press was claiming Wal-Mart was backing off its RFID efforts (see The Truth About RFID Adoption).

And yet, at last September's EPC Connection event, Carolyn Walton, Wal-Mart's VP of information technology, announced that Sam's Club (a division of Wal-Mart) would soon require 700 of its suppliers to tag pallets (see Wal-Mart, Sam's Club Push RFID Further Along). This caught many people off-guard—including Sam's competitors. Even those end users participating in standards meetings or attending association meetings on RFID get limited insight into what's happening in their industry, because competitors prefer not to share information.

By contrast, we have a broad view of the market and can spot trends in several ways. We can gauge interest in RFID by tracking the number of new subscribers and registered users in various industries. And we can monitor the level of interest by tracking event attendance—the pace of sign-ups and the number of people each company sends is a strong indicator. The level of attendance at different tracks and preconferences also provides insights into the level of adoption in different industries, and we survey our readers for each conference, then once more after the event.

I think it would be valuable for both RFID technology providers and end users to have access to such insights into market trends, so we are launching a new department in the May/June issue of our print magazine, entitled "The RFID Market." This department will provide and analyze data we collect, supplemented with anecdotal information gathered by our editorial staff through contacts with vendors, systems integrators and end users. As always, we will continue to respect the privacy of all companies and attendees.

We plan to conduct surveys on specific market areas from time to time, to gauge the state of such RFID market segments as active, passive high-frequency (HF) and ultrahigh-frequency (UHF) systems, as well as to determine interest in Electronic Product Code (EPC) standards. What's more, we may also perform custom research for interested vendors, sharing what we can from those efforts.

I believe it's in everyone's interest to have solid data on where the market stands, which sectors are adopting most quickly or most slowly, and so forth. RFID Journal's mission is to help companies make smart business decisions related to RFID. Good data will enable vendors to more effectively invest funds in new products and marketing—and it will also enable end users to invest in the technology wisely, whether that means to adopt, or to wait and see. So be on the lookout for the first "RFID Market" report in the coming issue of RFID Journal magazine.

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 or click here.
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