Opponents Rip RFID Jeans
By George Anderson
Those opposed to the use of item-level radio frequency identification (RFID) tags are unhappy with Levi Strauss’s confirmation that the company is doing a single-store test in the U.S. of the technology focused on inventory management. The company has also tested item-level tagging of its merchandise in two stores in Mexico.
Jeffrey Beckman, a spokesperson for Levi Strauss & Co., said, “The tags have information similar to bar codes, such as product, style, size and color. Having this information will allow the retail store to replenish stock quickly, so customers are frustrating when they can’t find the style and size. That’s the ultimate goal.”
Alastair McArthur, chief technology officer at TAGSYS, said other companies in the apparel space are either currently working with individual item tagging or developing RFID programs on this level.
“Some industries gaining traction are fashion textile and luxury goods,” he told ITnews.com out of Australia. “These are areas where item-level tagging has begun, and will continue to increase much quicker than in supermarkets to tag, for example, peanut butter.”
Opponents of RFID technology, such as Katherine Albrecht, said Levi Strauss’ test is a violation of a call by 40 leading privacy and civil liberties organizations “for a moratorium on chipping individual consumer items because the technology can be used to track people without their knowledge or consent.”
Levi Strauss’ failure to disclose where the test is taking place, RFID opponents assert, is an indication that the company fears a backlash from consumers.
Moderator’s Comment: How far away from widespread use of radio frequency identification (RFID) tags on an item-level basis are retail sectors, such as
apparel, consumer electronics and luxury goods? – George Anderson
– Moderator
I don’t think the question is whether RFID will gain traction — it will — but rather how will it be implemented. As Kai points out, the “dangers” are more perceived than real. (Although I would argue that a determined snoop will be able to track a working RFID tag from far further away and off its home network than anyone pushing RFID will tell you unless pressed.)
I want to see whether the tags are embedded in items so that they cannot easily be removed, or put on tags that can be. The latter is so easily compared to barcoded tags that consumer acceptance should be quick. The former seems more ominous, however. The opportunity to identify an item that was shoplifted and being returned for cash, alone, is probably enough to tempt retailers to embed the tags. Embedded tags are likely to create a backlash.
The most paranoid consumers will no doubt be microwaving all of their Levis for a while, but it will take a real effort to assure the public they have nothing to fear from embedded RFID tags.
The challenge with RFID on items will be reaching the point where “tags” that go to retailers without RFID readers become inexpensive enough that “slap and ship” is economical. There are three factors at work: the cost of tags, the number of distribution points (shipping and receiving) with readers, and the ability to capture item specific sales data.
Another big factor for a company that manufactures “branded commodities” such as blue jeans is diverting and counterfeiting. Levi’s may recoup their investment without any tag readers at the retailer by merely serializing all their products so they know where a pair of jeans was originally shipped and can detect missing or erroneous serial numbers. It is this factor that I believe will lure certain manufacturers into early adoption of RFID, even if the retailer cannot.
So I would say more manufacturers will jump on the bandwagon and by 2008 there will be a significant number of them using RFID. I guess an interesting question is – if RFID becomes meaningful to the manufacturer, will the retailer be able to order “unlabeled” merchandise in response to consumer concerns?
It’s no surprise to see industries such as consumer electronics and luxury goods increasing RFID use. RFID item-level tagging implementation will continue to gain momentum in retail sectors offering higher ticket items, but it will be a slow process. It’s important for consumers to understand how RFID works and how it will be used in the retail sector in order to dispel concerns regarding privacy invasion. Because RFID item-tagging rollout will be slow over the next few years, consumer confidence in the technology will have time to grow.
As the cost declines, the return on investment case becomes easier to make. Manufacturers and stores will face some customer anger and suspicion, just like the anger and suspicion directed at genetically-engineered food suppliers.
“Great spirits have always encountered violent opposition from mediocre minds.”
–Albert Einstein
This is a great example of a technology whose benefits are being held up by individuals and organizations who do not truly understand the limitations of the RFID tag as well as the information stored on it. These tags deliver no more information than other technologies currently in use in stores. They also have a limited “reflection” distance, since the store is their “home grid” under which they can work. Outside of this, they cannot function, nor can they deliver their information to their “home grid” once outside of the store. As far as tracking consumers in the store, we have been using surveillance cameras in stores to do this for years. It is unfortunate that a few individuals are stopping the mass deployment of a great technology through their ignorance. However, like all needed technologies, this will happen, it will just take longer.
Great quote, Warren. Having been harassed by the “privacy police” for comments I made in favor of RFID technology, I can attest that many of these folks either don’t understand the potential positive impact from RFID or don’t care and are just using the issue to further personal ambitions.
It all depends on whether or not consumers know it’s being used. As Mark said, it is comparable in some ways to labeling genetically modified foods. These were introduced all over the US without anyone knowing and it was only when people found out that the questions and arguments began. Not least because it had been introduced surreptitiously and with that infamously fatuous comment about not wanting to scare people by telling them what’s in their food.
As for Ron and Warren, I have to take personal exception to their opinions and compare them with the 21st century policy of using offense as a defense, throwing mud at anyone who disagrees with their views. I do not believe that I have a mediocre mind and I do not consider myself part of the privacy police. What I do believe is that people are entitled to choice and making their own decisions. For my part, I choose not to stick my head above the parapet when I know there is a likelihood of having it shot off or stalked. But I am aware of the “benefits” and security arguments and if other people don’t care about being watched wherever they go and whatever they do then that’s up to them.
If RFID at item level is introduced without customers knowing, then when they find out there is likely to be a backlash. As with those GM food products, telling people what was going on so that they could decide for themselves whether or not to eat them would have made more sense. There may be less backlash if the “education” being advocated here for RFID becomes the norm rather than stealth.
Like any other new technology that has the potential to infringe on personal rights, we will have to go through a transitional period and plenty of opposition from privacy groups as we test RFID. Like cookies online, they have the potential to be of great use to shoppers in the decision making process. However, how marketers and merchants utilize RFID will make or break it. If we respect the shopper, ensure that they are in control of the data that we utilize and, based on consumer insights, provide them with tools to make the buying process easier and more relevant, we’ll make great strides in consumer acceptance. If we don’t, the consumer will find a way to block it out. Hopefully, we as an industry will find a way to be responsible in its use so that we capitalize on this exciting new method to provide shoppers with a more rewarding store experience.
Missing here is the issue of counterfeiting. And, in response to the question, item-level RFID usage will begin with upscale and hotly-contested products. Levis qualify.
When you see view-bites of steamrollers mashing seized counterfeit products, isn’t it always designer watches and purses? Rather than the slow process described by others, if luxury products – with their comfortable profit margins – lead the way in item-level RFID, progress will be very, very fast. In these cases, it won’t be as important for retailers to possess RFID readers as for law enforcers to have them.
The question is, can RFID tags be counterfeited? Perhaps RFIDs can be incorporated into $100 bills.