Feb 19, 2014Let me get this out of the way up front: I believe RFID will replace traditional electronic article surveillance for loss prevention in retail stores. The reason harkens back to the question I posed in my column Retail's Trilogy: Which is better, one or more benefits?
EAS does one thing—it detects if something is going through a portal with a tag that has not been deactivated. It can't tell you what the item is or whether more than one item is being stolen. RFID knows exactly what is going through the portal, and it can recognize each item. RFID not only extends EAS's single functionality, it also has the capability to address inventory accuracy, out-of-stocks and many other use cases. As my good friend Bill Holder (former CIO of Dillard's) used to say, "At least with RFID, we know exactly what was stolen, so we can restock it for someone else to steal."
When an EAS-enabled alarm sounds, it is generally too late to stop the loss from occurring. With RFID, a retailer has the opportunity to actually prevent loss. The key is to use RFID-generated data to develop a loss-prevention system. A store, for example, could set up the system to recognize anomalies that indicate a theft is likely to occur, such as when a shopper takes two identical items into a dressing room or performs a "shelf sweep," removing several products from a shelf quickly and simultaneously. The system could alert store personnel to keep an eye on the shopper, possibly preventing rather than merely detecting a theft.
Consumers have grown accustomed to the external EAS hard tags and EAS soft tags affixed to items, both designed to visibly warn a potential thief that an alarm will sound if the tag isn't deactivated at the point of purchase. Some stores that adopt RFID may elect to use "dummy," or empty, hard tags to continue the visual deterrent (especially on high-theft items), or post signs indicating that RFID is sewn or built into products. The RFID tags will need to be affixed to products so they cannot be easily removed. Some retailers are embedding RFID tags into the care labels of clothing, and I know of one European retailer that is sewing the tag into apparel.
EAS vendors are actively helping retailers transition from EAS to RFID by converting conventional EAS portals to dual-purpose portals that recognize both EAS and RFID tags, and by providing hybrid EAS-RFID hard tags.
Sorry, EAS, but your days are numbered. The issue is not whether EAS is a good technology, it's just that RFID is a better technology. And better always disrupts the status quo.
Bill Hardgrave is the dean of Auburn University's Harbert College of Business and the founder of the University of Arkansas' RFID Research Center. He will address other RFID adoption and business case issues in this column. Send your questions to hardgrave@auburn.edu.