Jul 06, 2009Asia has a reputation for being a haven for counterfeiters, but GS1 Hong Kong is working with several companies to test a radio frequency identification system designed to give consumers a convenient and reliable way to distinguish genuine goods from counterfeit products at airport retailers.
For the project, funded by Hong Kong's Office of the Government Chief Information Officer (OGCIO), individual products are assigned a unique VerCode, hidden under a secure label. Consumers can then verify a product's authenticity by inputting the code via GS1 Hong Kong's Barcode Plus Web site, or by sending a text message to a local phone number so that the product code can be confirmed.
But to improve the traceability of goods from production to purchase, GS1 Hong Kong also assigned RFID tags to each product, and installed RFID smart kiosks at airport retailer Travelcare Express, operated by Nuance Watson. Customers can scan the RFID label on any product at the duty-free shop, then track that item through critical points along the supply chain.
Anna Lin, GS1 Hong Kong's chief executive, says the country is well known as a shoppers' paradise, but consumers must have confidence in the integrity of retailers' leading brands. "The product authentication solution provides a trusted channel for participating companies to deliver product quality information to consumers," she says. "It allows consumers to distinguish between genuine products and fakes. Moreover, it enables retailers to protect their supply chains from counterfeit products, and ensure the integrity of their brand names. In the long term, these efforts will help enhance Hong Kong's reputation for providing authentic goods at a reasonable price."
GS1 Hong Kong chose RFID because it can be used to capture the data necessary for conducting track-and-trace applications with little human labor and few errors. It then sought support from four companies representing different roles in the supply chain, including Hong Kong-based Chinese medicine manufacturer Po Sum On Medicine Factory, traditional Chinese ingredient supplier First Edible Nest, health supplement supplier Comvita and retailer Nuance Watson, which runs Travelcare Express stores at airports.
A secure bar-code label and RFID tag are attached to each product item. The serial numbers are associated with that item, which is packed into a case that is then picked and placed into a tote when needed at the store. The RFID tag is read and recorded at each stage. The captured data is then transmitted to ezTRACK, GS1 Hong Knog's track-and-trace software platform (see GS1 Hong Kong Launches Online Track-and-Trace Platform).
"Consumer can simply scan the RFID tag of the selected product at the smart kiosk to get information about critical points in the production line," Lin says, "and browse for more detailed product information before making a purchase."
Alessandra Piovesana, Nuance Watson's North Asia regional managing director, says GS1 approached her company with the proposed product authentication system. "The launch of the product authentication smart kiosks is a customer service enhancement rather than a business solution," she says. "Hong Kong International Airport is a well-known, world-class airport, and the standard required from retailers is very high—brand integrity and product authenticity have been a strength of the airport. Given the government support, and the fact that we know RFID is a reliable system that has been adopted in other areas, such as the baggage-claim system, it gave us confidence that the smart kiosks could provide customers with reliable assurance."
GS1 Hong Kong provided substantial technical support in delivering the smart kiosks, but Piovesana says the preparation involved took much longer. "This included the selection of category, store and location to run the pilot project," she explains, "as we wanted a good level of exposure to customers. Next was the process of recruiting and lining up manufacturers."
The response from customers has been positive, Piovesana says. "However, we wish to get more feedback in order to evaluate possible rollouts to our other stores," she notes. "The success of this initiative also counts on the support of manufacturers, because it demands their punctual supply of updated product data and corresponding track-and-trace information through critical points in the production line, which all takes a huge effort."
The product authentication system will ultimately provide numerous benefits to retailers, Lin says. "New users or companies do not need to invest heavily to get started, so it is an affordable solution for companies of all sizes," she states. "With the government funding, we have already built up a robust infrastructure for the system. It can then help businesses protect brand image and thwart counterfeiting to neutralize negative brand association—and with improved traceability, companies can enjoy greater benefits in the long run."
GS1 began planning the project in July 2008, and the three-month trial was officially launched in May of this year. After the project is completed, GS1 Hong Kong plans to first promote the solution among its members, then launch it in the market early next year.
