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Retailers test new ID tech to try and 'wow' individual consumers

This is an RFID (radio frequency identification) tag. Walmart has been using them for years to track pallets of inventory, and added them to a few clothing categories in 2009. Macy’s is next.


This is an RFID (radio frequency identification) tag. Walmart has been using them for years to track pallets of inventory, and added them to a few clothing categories in 2009. Macy’s is next.

Lost in the hype over smart phones revolutionizing shopping is how other wireless technology is about to transform the store experience, too.

Shopping vets may not like all of the advances trumpeted at last week's annual National Retail Federation trade expo in New York City.

To borrow from Doc Brown in Back to the Future, where they're going, they won't need wires.

First up: RFID, or radio frequency identification. That's a tiny computer chip that Walmart has been using since 2006 to keep track of pallets of goods flowing in and out of its warehouses and stores.

Each tag broadcasts a radio signal that beams 10 times as much information as a bar code to sensors deployed in doorways and store fixtures. With the price at 8 cents a tag and dropping, merchants are now starting to hang RFID tags on individual high-dollar items like apparel so they can pinpoint every item in their stock down to the shelf.

Walmart started putting RFID tags in the jeans and men's underwear departments in stores in July. After a test at one Bloomingdale's, corporate parent Macy's Inc. will expand its first RFID steps this year to basic men's apparel in all its New York department stores.

The tags empower chains to identify each garment by size, style and color in a real-time inventory. That dramatically enhances their ability to be fully stocked with the right goods at the right store more often.

It's part of an industrywide initiative aimed at curing the apparel industry's abysmal 60 to 65 percent inventory accuracy.

"In our test, the accuracy improved to 95 percent," said Peter Longo, who heads Macy's logistics and co-chairs an retail/apparel industry effort to shepherd RFID inventory control to common use. "The sales (people) like it because it gives them a handheld device that leads them to the exact item the customer is looking for."

Retailers hope to wring $60 billion from annual expenses once RFID is widespread.

"This is no longer a science experiment," wrote Mark Roberti, editor of the RFID Journal, a trade publication.

The upside for shoppers is lower prices and fewer missing sizes thanks to technology-driven efficiencies. The downsides: fewer markdown sales to unload unsold inventory mistakes deployed in the wrong place or store. And, because RFID tags can keep broadcasting after the sale, potentially lost privacy to customers who forget to throw tags away if a store doesn't deactivate them or opt for a passive system.

RFID joins other wireless gadgetry the tech industry dreamed up for a store near you.

If some are reminiscent of tech gadgets Tom Cruise used in the 2002 film Minority Report, that's close to the vision.

To promote uses of its new more powerful microprocessor, Intel Corp. rigged in-store demos at the retail convention that combine HDTV video walls with tiny cameras that wirelessly react to body gestures rather than a touch screen.

Using technology similar to the new Xbox Kinect, a wire-free game system that one-ups the Nintendo Wii, digital signs display product information and shopping navigation options in vivid full-motion video. Shoppers can control what they see by pointing a finger and hovering over menu options. Or the cameras can take facial feature measurements to air targeted pitches based on the age, sex or height of whoever is peering at a giant screen at the end of a supermarket aisle. A finger point gesture summons price comparisons, recipes, nutritional information or warranty details, or activates a vending dispenser.

Adidas, the German footwear maker, will test video wall technology in one of its stores this year. Shoppers point to spin an animated wheel filled with sharp images of hundreds of shoes in dozens of colors. Point to one shoe and a clerk fetches the right size from a stockroom or mails you a pair.

Walking a fine line over privacy, Intel calls the measurement system "facial detection," not facial recognition that identifies a shopper by name.

But that could be done with RFID sensors reading from several feet away a chip embedded for security in a growing number of credit or loyalty cards.

That potential attracted the designers reinvigorating the Disney Store chain, which is weighing how to call out shoppers by name when they walk past the front window.

"RFID may turn out too intrusive, but we're looking to create a 'Wow, how did they do that?' moment," said Neal Lassila, vice president of information technology for the 340-store chain.

Or, he suggests, give it time. "In a few years, perceptions of privacy may change."

Mark Albright can be reached at or (727) 893-8252.

Retailers test new ID tech to try and 'wow' individual consumers 01/17/11 [Last modified: Thursday, January 20, 2011 11:12am]
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