I came across an interesting article about “RFIQ” at Forbes’ website (see How RFID Could Be Litmus Test For Retail), written by Marshall Kay, a principal at consulting firm RFID Sherpas. In the article, Kay poses a series of questions, such as “Do you know the range of ways [in which RFID] is being used?” The idea is to understand how much a company, as well as the individuals at that company, understand the value of radio frequency identification technologies. This could help equity analysts determine the future success of retailers, but the same is true for other businesses as well.
Unfortunately, Marshall concludes—rightly so—that with only a few exceptions (he mentions Nike), retailers have a low RFIQ. The same is true in other sectors. While RFID Journal’s readers generally have a high RFIQ, I know from your emails that many of you struggle to educate upper management about the technology’s value, and that getting projects funded is often a challenge.
So, my question is this: why? Why are most people ignorant about the value of this technology? RFID Journal publishes articles virtually every day outlining the value of RFID, and about successful deployments. Surely, it shouldn’t be a secret.
There are, I believe, several reasons for this. One is that there have been few champions. Early on, Walmart spoke about using RFID to reduce out-of-stocks. Large companies, including IBM, Oracle, Microsoft and Accenture, jumped into the market. Then a patent lawsuit that targeted a percentage of the benefits achieved from RFID at Walmart caused the retailer to completely abandon the technology, giving many companies the view that it simply doesn’t work—which, of course, is not true.
RFID technology gained a reputation among business journalists as being too expensive and of not working in many situations. I still hear people say it won’t work around water and metal, even though in most cases, the technology can function seamlessly on metal cans and with products containing high water content.
The RFID industry, despite RFID Journal’s efforts, failed to effectively counter the negative view of RFID and promote a positive one. In many instances, companies simply ran away from the RFID name and claimed they sold “sensor networks” or “Internet of Things technologies.” No trade body launched a “Got milk?”-type of campaign explaining RFID’s benefits or the advances in dealing with water and metal.
What’s more, the RFID industry never countered the view businesses have of RFID as being more expensive than barcodes. What every RFID company should have been explaining for the past 10 years is that it makes no sense to compare the cost of the data carrier. You need to compare the cost of capturing the data with each technology, and it is more expensive to pay someone to scan each barcode than it is to have an RFID reader capture that information automatically. I have never heard any RFID company make this point during a presentation, and I have seen thousands of presentations.
Next week, I will discuss the ways in which the RFID industry could burnish the technology’s image and foster greater adoption.
Mark Roberti is the founder and editor of RFID Journal.