Lowe’s Employs RFID, Blockchain to Combat Retail Theft

Project Unlock combines RFID chips and Internet of Things sensors to activate power tools at the point of purchase.
Published: January 4, 2023

Ed. Note: This article was previously posted at Retail TouchPoints.

Lowe’s has unveiled a new solution developed in its Innovation Labs division, designed to combat retail theft in way that is invisible to customers, through the use of radio frequency identification (RFID) chips and the blockchain. Known as Project Unlock, the new technology combines low-cost RFID chips and Internet of Things (IoT) sensors to activate power tools at the point of purchase, while also creating a secure, publicly accessible and anonymized record of legitimate purchases on the blockchain.

Organized retail crime has been on the rise since 2020 and costs retailers an average of $700,000 per $1 billion in sales, according to the National Retail Federation. Solutions up until now have typically involved locking up high-value merchandise, but Lowe’s new technology could allow the company to throw away its padlocks and shelf gates.

Visualization of how Project Unlock RFID tags will work.

Project Unlock features two interconnected solutions. The first is point-of-sale (POS) product activation by which only products that are legitimately purchased are activated. This means that if a power tool is stolen, it won’t work. The POS activation is powered by an RFID tag that is embedded in the product by the manufacturer and pre-loaded with each item’s unique serial number. That serial number also is embedded in the box’s barcode, and the product is set to “inoperable.” When the barcode is scanned at the register, it is then activated for use.

The second piece of the solution is a transparent purchase record to hep retailers, manufacturers and law enforcement authenticate and validate ownership. Once a customer buys a product, it is recorded to the blockchain, after which these records, which contain no personal customer information, can be checked by anyone. For example, marketplaces and other resellers can check a record to ensure they’re not buying a stolen good. To make this work, a unique non-fungible token (NFT) is created for each physical product.

At the outset, Project Unlock will be deployed at Lowe’s stores across its power tools assortment to offer proof of concept, but a Lowe’s spokesperson said the company “sees potential to use this invisible blockchain and RFID system for other items in its stores and across the entire retail ecosystem.” In a video demonstrating the new technology, Lowe’s explained: “It’s our job to make sure customers experience as little friction as possible—that’s why we’re so concerned about retail theft and committed to preventing it. We see a future where technologies like Project Unlock can help the entire retail ecosystem create a great environment for our customers.”