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Meeting the Expectations of Today's Holiday Shopper

RFID is helping retailers keep up with the changing behavior of consumers as they make purchases online, expect fast shipping and visit stores self-educated about the products being sold there.
By Claire Swedberg
Dec 15, 2016

It would be difficult to overstate how much the holiday shopping experience has changed in the past three or four years; online sales rates are rising annually, while brick-and-mortar stores are tasked with finding new ways in which to engage with shoppers. This season, retailers are facing—and addressing—challenges related to that shift into online shopping with a multitude of strategies centered around RFID technology.

Global retailer Target illustrates the trend most retailers are facing. The company reported a 0.2 percent decline in in-store sales during the third quarter of this year compared to 2015, but that was more than offset by online sales, which rose by 26 percent throughout the same period. A growing number of retailers, like Target, are using RFID tags on their products to not only attract shoppers back to their brick-and-mortar stores, but also compete in the digital world, by ensuring that their products can be shipped to customers within days, or be made available at their local mall.

Tyco's Randy Dunn
Tyco Retail Solutions' customers are using RFID technology to meet the challenges of a new kind of shopper, according to Randy Dunn, the company's North American sales leader for inventory intelligence. Online retail operations like Amazon, as well as smartphones, have permanently altered the way in which consumers shop. Even the behaviors of shoppers at brick-and-mortar stores have changed. Consumers who don't make their purchases online have already been perusing products on the internet, and thus tend to have some education regarding what goods might be available at a particular store. Customers who previously visited stores to browse now arrive on a mission to buy a specific product. That preliminary online research by a consumer can lead to a greater percentage in sales, Dunn says. However, he adds, retailers need to be able to meet a modern shopper's expectations.

The first and foremost benefit derived from RFID deployments, Dunn reports, comes from tracking back-room and store-front inventory. Retailers have learned, during the past few years, that visibility into what has arrived in a store's back storage area, what has moved to the sales floor and when store shelves are emptied, boost sales—not only in physical stores, but also from omnichannel purchases online. In fact, he says, omnichannel sales models don't work at all if a retailer cannot be sure where its inventory is located, so that it can sell a product to a consumer that could be quickly and efficiently shipped to that person. "RFID provides really well-controlled cycle counts," he states, "and the ability to allocate products between distribution centers and stores."

During the holiday shopping season, stores tend to load up on inventory to prepare for the rush. "With the use of RFID," Dunn says, "they can trust their data about the inventory," and that enables the retailer to store less inventory at any specific site.

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