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Retailers Use RFID to Woo Shoppers

It's not easy to engage customers, in stores or online, but a number of innovative applications may do the trick.
By Mark Roberti
Aug 26, 2014

About four years ago, retailers began switching their focus from using radio frequency identification to track pallets and cases in their supply chains to monitoring unique items in stores. This shift was driven, in part, by studies conducted by the RFID Research Center at the University of Arkansas that showed using passive ultrahigh-frequency RFID systems to take inventory of apparel in stores could increase inventory accuracy from roughly 65 percent to more than 95 percent. Subsequent trials found that improved in-store inventory accuracy often led to an increase in sales.

During the past few years, Bloomingdale's, Macy's, Lord & Taylor, Saks and other U.S. retailers announced they were using RFID in stores. This year, the pace of retailers worldwide adopting RFID technology to manage inventory has picked up (see "Retailers Already Sold on RFID").

Illustration: iStockphoto
Now, some retailers are deploying innovative RFID solutions to capture customers' attention and make a sale. Here's a look at some of the new applications being rolled out by retailers. Alex and Ani, a U.S. jewelry and apparel retailer, deployed Bluetooth Low Energy (BLE) beacons at all 40 of its branded stores in an effort to engage customers by sending data directly to their mobile phones while they shop. The beacons, which are essentially active RFID transponders, were supplied by in-store mobile marketing company Swirl Networks. If a shopper has a Swirl In-Store Explorer application running on his or her handset, that individual can receive product information on the phone, based on the in-store location of that beacon (and, thus, that customer). The retailer is also able to collect information regarding customer interest and traffic. Timberland and Kenneth Cole also have adopted the solution (see Alex and Ani Rolls Out Swirl's Bluetooth Beacons at 40 Stores).

Several retailers are planning to deploy a similar system developed by U.K.-based startup Iconeme, which uses BLE technology to enable store mannequins to transmit data to customers. The VMBeacon solution consists of a beaconing device installed inside a mannequin that transmits a signal to the Bluetooth reader built into a consumer's phone. In that way, individuals who pass in front of mannequins, either in a store or at a store window, can receive information about the garments that mannequin is wearing, including sizes, colors, prices and online buying options, as well as coupons (see Iconeme Launches Bluetooth Beacon Solution for Mannequins).

Tarrytown Pharmacy, in Austin, Texas, deployed a series of hybrid beacons—combining BLE and Near Field Communication technologies—to enable customers to access coupons and promotional information regarding products via a simple tap of their mobile phones. The solution, provided by startup Shelfbucks, consists of the beacons and a Shelfbucks application that consumers download to display product and promotional information. If, for example, a customer taps a Shelfbucks beacon located in the store's cold and flu products section, he or she can receive information about facial tissues currently on sale (see Shelfbucks' Bluetooth-NFC Beacons Bring Discounts to Tarrytown Pharmacy's Shoppers).

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