The Reason behind an RFID Label on a 72-cent Box of Crayons Warrants a Pinkish Sense of Amusement
The Reason behind an RFID Label on a 72-cent Box of Crayons Warrants a Pinkish Sense of Amusement
Going on a shopping spree in Texas at one of Walmart's numerous superstores resulted in numerous items priced under $3, including a couple under 75 cents. Interestingly, all these products shared a common trait - a serialized radio frequency identification (RFID) smart label.
It was an opportune time to delve deeper into Walmart's shelves. It had been nearly three years since the news broke that they were expanding their successful RFID program into numerous new product categories. Household items, electronics, hardware, gardening tools, toys, sports equipment, and art supplies were some of the new categories being introduced. Clothing, footwear, jewelry, and sunglasses were already being tagged by Walmart's suppliers. Among the day's purchases:
Under 75 cents: Colored Pencils; Fishing Hooks; Water Sprinkler Heads
75 cents - $1.99: Hose Nozzle Adapter
$2 - $2.99: Sketchbook; Tweezers; Wooden Puzzle
$3 - $4.99: Barbecue Oil Pan Liners
$5 and Above: Engine Oil
Previously, it was uncommon to find RFID smart labels being used at scale on sub-$1 items - a significant leap in the retail industry's history. And for clarity, these items were not being sold at a discount. These were their usual prices.
The significant story, however, is not the crossing of the 75 cent threshold. Rather, it's the massive volume of items under $3 now present on the shelves.
What This Reveals
The rapid spreading of RFID tagging to products at extremely low price points indicates the collective value that multi-purpose smart labels can generate when retailers leverage them in various ways.
It's essential to note that this does not imply that every consumer good above 72 cents should now receive an RFID smart label. The context always matters.
A Success for Customers
As more goods receive RFID smart labels, the greater the advantage for customers. Similarly, the wider the range of retailers using RFID, the better it is for consumers.
Retailers who utilize RFID do a better job of maintaining their stores’ stock levels. When a desired item is out of stock, sales associates are better equipped to assist.
The combination of inventory accuracy, visibility, and findability brings about the required precision for seamless integration of online and in-store shopping.
RFID allows items searched online to reach customers more swiftly. A higher percentage of a store’s on-hand inventory can be made available for BOPIS programs (Buy Online Pickup In Store) or for fulfillment of online orders shipped to a customer's home.
Reducing the time window for order pickup is another benefit for retailers. Speaking at the RFID Journal Live! conference in 2022, Andrew Tashiro, former VP Retail Inventory Management at childrenswear brand Carter’s, proudly shared that the use of RFID allowed Carter’s to promise pickup of BOPIS orders within 60 minutes instead of 120 minutes.
Retailers Benefit Too
RFID addresses several traditional retail challenges. However, the discussion often starts with inventory accuracy. Retailers who use RFID possess a thorough understanding of each store's true on-hand inventory. And they get this picture for every unique product in their merchandise range.
As an added bonus, the RFID system distinguishes between a product's stock room and sales floor quantities. Not only is this beneficial for merchants, but it helps store managers and frontline employees complete their tasks more efficiently.
“I can't imagine executing Omnichannel successfully without RFID” stated Kirsten L’Orange at the 2024 NRF Big Show. She leads Omnichannel Productivity globally for Levi Strauss & Co. It's only natural that a retailer would want RFID smart labels on as many of its products as possible.
Accuracy and visibility together enable retailers to operate their stores with less surplus stock if they wish. Precision unlocks upstream supply chain benefits too, from factory to store.
The fact that RFID plays an essential role in reducing theft more effectively is a win for both retailers and customers, a fact often overlooked. The cost of crime is ultimately borne by honest customers, in the form of higher prices. RFID has been lauded as a game-changer by leading experts on retail theft. Businesses and law enforcement have begun using RFID to investigate, prosecute, and prevent crime in innovative ways. Some American District Attorneys are already RFID enthusiasts.
Identifying RFID in Real Life
If a product bears one of the logos shown in Figure 1 on its price tag, on an additional label, or elsewhere on its packaging, then the product has an RFID label. Similar logos may exist, but these two are the most prevalent.
Figure 1
In Summary
Keep an eye on the increasing presence of RFID smart labels on items with ultra-low prices to get a glimpse of retail's future.
The expansion of RFID tagging to low-priced items at Walmart, such as colored pencils, fishing hooks, and water sprinkler heads, highlights the versatility of these smart labels in driving inventory accuracy. This has also improved the efficiency of sales associates in handling out-of-stock items, enhancing the overall shopping experience.
The increased use of RFID smart labels, as seen in various retailers, leads to better inventory management, enabling a higher percentage of in-store inventory to be available for BOPIS programs or online orders, thereby reducing the order pickup time for customers.