RFID in retail


Retail is expecting a lot from radio-frequency identification. However, the fear of trouble in public is at least as great. The biggest technical issues have been resolved and now the specifics are being put to the test. Not long now, until a comprehensive launch in stores is taking place. The fashion industry is the trailblazer.

In January, the German WDR TV channel reported in its consumer reports show „markt“ (marketplace) about the dangers of RFID. The show claimed that non-deactivated RFID labels in clothing turn consumers into so-called naked customers. Privacy advocates are warning people: every chip contains a globally unique number – and it can be contactless detected and stored. They say, you can create movement profiles of people. Activists of the Foebud Association in Bielefeld demonstrated how the RFID numbers can be readout in the clothes of pedestrians even from a great distance.

This time they targeted Gerry Weber. Other retailers also have seen themselves in the headlines. RFID critics showcased the reader of the women’s fashion manufacturer in front of its store in Bielefeld. The annual production of 26 million pieces is equipped with RFID labels. In 2009, Gerry Weber was the first retailer in Germany that introduced RFID labels nationwide. It opted for labels by Avery Dennison.

”We remove the care label at the cash register if the customer wants us to”, explains Christian von Grone, the person in charge at Gerry Weber during the ”markt“ broadcast. Most women prefer to cut out the label themselves at home, he said. Gerry Weber informs its customers with flyers to remove the tag before wearing the clothing items for the first time. No customer needs to worry that his/her name is being linked to an RFID number.

Adler has expanded RFID

During the spring, apparel retail chain store Adler decided to take “the next step on its way to a comprehensive use of the RFID technology in its retail network“, states the press release. After conducting “prototype testing” beforehand at a branch store in Weiterstadt, the company now gains more experience in four more branches. Results are expected in the fall. The company did not want to reveal to on how things are proceeding.

The Adler solution plans RFID use in its entire apparel sector with the exception of some accessories and in the final stage for about 30 million items annually. Adler now tests with Syspro (system integration and software), Nedap (antennas), Odendahldruck (labels, RAKO is the supplier), Nordic ID (handhelds), Toshiba TEC (printers) and Tailorit (project support). Most likely, tag deactivation also plays a role. This is an important point for consumer protection agencies.

Technology has become better and cheaper

Manufacturers are optimistic that now there finally will be the breakthrough for RFID in retail as it has been discussed for several years. In an interview with the trade magazine ”RFID im Blick“ (RFID at a glance), recently Lothar Struckmeier, Managing Director of the German office of NordicID stated:”At the moment, there is a surge of RFID.“ Fashion manufacturers, fashion retailers and their logistics service providers are said to use this technology to create the entire supply chain, protect the merchandise and avoid out-of-stock situations. “RFID im Blick” assesses Struckmeier’s statement, stating that the top ten European fashion retailers will have started a RFID project by 2015 at the latest, as a “bold prediction“. In one point though, Struckmeier is absolutely right: fashion is the trailblazing industry sector. Apparel goes along well with the RFID chips.

”The technical issues are becoming less and less, since optical character recognition and transponder technologies especially over the past two years have become significantly more efficient“, says Thorsten Wischnewski, Divisional Manager RFID at RAKO, in an interview on this focal topic. Lothar Struckmeier believes: ROI can now be reached a lot faster than in previous years, thanks to improved technology. “RFID drivers will be the vertical producers with their own spaces. Fashion manufacturers without their own spaces will have to follow, because fashion houses demand it."

C&A: Labels are clearly visible

Another great example for this is C&A. In June, the fashion retailer from Düsseldorf – similar to Adler right before them – selected a few of its stores for a field test. C&A chose Duisburg, Euskirchen, Hürth, Mönchengladbach and Siegburg as locations. For seven months, various technical and organizational aspects are meant to be tested before the nationwide launch.

C&A emphasizes, that the RFID tags will be clearly visible on the outside of clothing articles. The transponders are the size of a typical price tag and will be attached by a plastic ring on the merchandise. The easy removal by the customer after the purchase is therefore ensured. In addition, the company informs about the use of this technology with posters and flyers in its stores. C&A spokesperson Thorsten Rolfes argues this like many others in the industry sector: all laws, standards and recommendations on RFID on a national and European level are being observed. ”We will only introduce RFID nationwide in German C&A stores if we can guarantee we meet the requirements by the consumer for absolute RFID data security."

Clearly visible on the outside of the articles – this is supposed to provide transparency. That said it would actually make sense to incorporate the tags into the merchandise to protect against theft. This could be done in the soles of shoes for instance, since it is not shoeboxes that are stolen in stores, but rather the shoes that people put on without being noticed and then do not pay and walk out the store with.

Trendsetter fashion, research for consumer goods

Technically speaking, it is not quite as simple. It definitely depends on which transponders you use and where you attach them. Consumer agencies do not see this as a problem, as long as this is about transport packaging or containers in the logistics chain. In a publicly sponsored project, the RWTH Aachen University is currently researching how merchandise tracking can be optimized in this instance.

For some years now, pallets have been tracked with RFID on the transportation route. The project in Aachen is about the fundamentals for the use of radio-frequency identification in outer packaging for consumer items and the use of RFID real-time data to optimize the supply chain. The project is looking for the optimal transponders and their ideal placement. In doing so, the manufacturing process of the packaging material as well as the automated installation and coding of the transponder is also being reviewed. At the same time in a field trial, data is being collected from the project partners along the entire value-added chain. This includes, among others, the confectionary suppliers Mars and Metro. Here, one can also sense some caution. Project leader Theo Lutz declines an interview “at this point in time“. He says there are no findings yet.

René Schellbach,

Interview with Thorsten Wischnewski, Divisional Manager RFID at RAKO Security Label, Witzhave

Soccer and the Olympics – this summer offers some major popular events. RFID is getting more and more important in sports. Does this improve the acceptance of radio frequency identification in society? We asked Thorsten Wischnewski from RAKO. The conglomerate from Witzhave by Hamburg, Germany, is an exhibitor at EuroCIS and serves the sport industry as well as the retail market.

What role does RFID play in sports?

There is an increasing prevalence of RFID for identifying people and objects. This also pertains to sports. Some examples for this are electronic timing, entry controls or time management of employees. RFID also offers solutions for logistics, sales promotion and for proof of authenticity in merchandising.

Which track events have you outfitted with RFID?

Together with our partner davengo for instance, we carry out time measurement for the largest corporate relay event called b2run in Germany with over 80,000 participants. Our services include a registration portal, the transponder, the runner number, analysis using special software and results services in list, image and video formats as well as several other features.

What parameters have to be accomplished?

In electronic time measurement, a hundred percent collection rate is an essential prerequisite for great service. A special UHF label with adapted optical character recognition was developed for this, which also works on the body.

Was the ball inside the goal or wasn’t it? This is what it is all about again right now at the UEFA Cup. Can you envision RFID in soccer?

I can picture it very well. RFID would be well suited for this and could be utilized. However, optical systems offer an alternative.

RFID on admission tickets: what are the possible advantages?

After the 2006 FIFA World Cup in Germany, unfortunately not enough advantages were being detected using RFID in tickets. Without a doubt however, RFID can contribute to make counterfeiting more difficult and controls easier and faster. However, with the increasing prevalence of NFC technology, I expect a new surge in the use of RFID in the entryway to sporting events.

Could RFID in sports improve its acceptance in the public eye?

RFID is able to make a contribution here, however, the perception of this technology with athletes then has to be raised. One method would be to use transponder timing for discount tickets. After all, many cash registers in retail are already equipped with RFID scanners.

Commercial enterprises test RFID on their sales floors. In which projects are you “on the ball”?

At Gerry Weber, Adler, Marc O'Polo, Schöffel-Lowa, S’Oliver and many more.

What technical issues are there still at the moment, preventing an extensive RFID launch in retail?

The technical issues are becoming less and less, since the optical character recognition and transponder technologies especially over the past two years have become significantly more efficient. If you make a process change in a few areas, there are only few technical limitations.

Additional information for customers: what is the advantage of RFID? When does a QR Code on a Smartphone make more sense?

QR Codes are hard to take a picture of and follow different standards. Thanks to NFC in Smartphones, RFID offers globally standardized, more robust, faster and easier identification. What’s more, the big advantage of RFID is not just its use in marketing, but also for payment.

Interview by René Schellbach,