Using RFID to Improve Online Availability

Radio frequency identification can play an invaluable role in linking online and brick-and-mortar stores.
Published: August 26, 2010

Reading The New York Times on the train into Manhattan this week, I was struck by an article reporting that upscale retailer Nordstrom has been able to boost its sales—while most other retailers have struggled—by linking its online store with its brick-and-mortar stores (see Nordstrom Links Online Inventory to Real World).

This is not a new concept. Others have talked about it, and even tried it. What Nordstrom did that was a little different was to display stock from both its Web warehouse and its stores.

The article says: “The change works this way: Say that a shopper was looking at a blue Marc Jacobs handbag at She could see where it was available at nearby stores, and reserve it for pickup the same day. More significant, if the Web warehouse was out of that bag, it did not matter. Inventory from Nordstrom’s 115 regular stores is also included. Maybe there was just one handbag left in the entire company, sitting forlornly in the back of the Roosevelt Field store—it would be displayed online and store employees would ship it to the Web customer.”

It’s an interesting improvement on existing Web-based shopping sites, but the problem is that apparel retailers often have bad inventory data. If an item is stolen or misplaced, it would appear on the site as being available for purchase and pickup at the store. But when a shopper arrived at the store, it might not be there. Perhaps Nordstrom has great inventory accuracy—but for those retailers that do not, customers would be mighty angry if they drove to a store to pick up an item they’d purchased online, only to find that it was unavailable.

Another challenge involves making sure stores maintain the correct inventory levels. I searched for an Armani Collezioni grey plaid wool sportcoat on Nordstrom’s site, but none of the seven stores within 100 miles of my home had one in stock. I did another search for a Versace Collection navy grid wool blazer, and only one of the seven showed it as being in stock. This really doesn’t help the customer experience.

The Times article indicates that Nordstrom’s sales are up, so the company is probably executing on this new strategy fairly effectively. But having 99 percent inventory accuracy in the stores would ensure that very few customers are ever disappointed. Those retailers only looking at RFID to improve on-shelf availability should think about online availability as well.

Mark Roberti is the founder and editor of RFID Journal. If you would like to comment on this article, click on the link below. To read more of Mark’s opinions, visit the RFID Journal Blog or the Editor’s Note archive.