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How RFID Adoption Will Accelerate

The pace of adoption will be driven by retail and then spread to other sectors.
By Mark Roberti
Oct 05, 2015

Many companies—both those that sell radio frequency identification technology and potential users—seem to be under the impression that adoption, which was slower than most experts originally expected, will remain slow for the foreseeable future. In this column, I will explain why that view is wrong—and next week, I'll explain why holding onto it could hurt your company.

Adoption of new technologies almost always takes longer than expected. There is a lot of hype early on, after which the technology proves harder to deploy successfully than expected and many companies move on to other projects. Meanwhile, under the radar of the mainstream business press, solution providers improve their offerings. They create products that are easier to deploy, less expensive and more complete.

That alone doesn't drive adoption. Companies don't run out and buy a solution just because one exists. It takes time for some to take a chance on the relatively new (but increasingly mature) technology and to prove it works. Once they do, this encourages competitors to adopt, because they don't want to be left behind. Then more competitors adopt.

Each time there is a new deployment, it causes more companies to look afresh at the new technology. Some will deploy, while others will continue to focus on other priorities. But gradually, the industry reaches critical mass and then everyone adopts.

We are seeing this play out with RFID in the retail and apparel sector. Early on, American Apparel was a lone wolf, the only U.S. retailer to use RFID on all its items to improve inventory accuracy (see American Apparel Makes a Bold Fashion Statement With RFID and American Apparel Expands RFID to Additional Stores). Macy's and its sister company, Bloomingdale's, began experimenting with the technology and concluded that it could boost inventory accuracy and improve store execution (see Macy's Inc. to Begin Item-Level Tagging in 850 Stores, as well as Bloomingdale's Journey from RFID Concept to Rollout, Part 1, Part 2 and Part 3).

It was several years between the American Apparel and Macy's announcements. Then Kohl's announced that it was using RFID (see Kohl's Rolls Out RFID for Select Product Categories at Its Stores), and then Target (see Target Announces Nationwide RFID Rollout). The interval between announcements is clearly getting shorter, as is the time from when companies first begin looking at RFID to when they deploy it.

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