Retail in Asia

In Shops

The Next 50 Years: The Evolution of Source Tagging and RFID

It seems strange to think of times when phones were used only for making calls. Stuck to walls or desks with cables, unwieldy, and only worked with dedicated lines. If you wanted to take a photo or a video you needed a camera with film and another video camera with cumbersome tape cassettes!

Fast forward to today and our smartphones are used for so much more than making calls, an essential part of our social and business life: combining voice, data services, and even a camera for stills and video all in one neat package. Electronic article surveillance (EAS) hard tags have undergone a similar evolution moving from cumbersome “dumb” tags to a multipurpose application.

Looking back, hard tags were dumb, clunky annoyances attached to only a certain category of garments, much the same way the first cell phones were clunky, impractical, and anything but “smart.” Today, however, EAS hard tags are sleek, available for most product categories, and serve as the underpinning to every store operations system. As any retailer can attest, effective and efficient operations are more important than ever as customers demand excellence at every interaction and easily move to the competition their needs cannot be met.

Today’s consumers demand attentive associates, in-stock items, and a fast, easy checkout process. Subsequently, retailers need their employees to be not only motivated to help customers but also empowered with more time to service those shoppers and minimize the superfluous tasks on the selling floor. Source tagging facilitates many of these operational synergies in the value chain for today’s retailer, and adding RFID provides the insight needed to make it a reality.

As a necessary visual deterrent, new hard-tag recirculation allows retailers to take advantage of the benefits of source tagging while still maintaining the safety and security of a hard-tag format. In addition to the traditional benefits of source tagging—reduction in shrink and labour expenses, increased sales with floor-ready merchandise— hard-tag recirculation can also serve as an important bridge to RFID-based solutions for loss prevention and store performance applications. With just one dual acousto-magnetic (AM)/RFID hard tag applied at the source, retailers can extend the benefits of traditional loss prevention to store performance initiatives. That combination of insight and action is a powerful force in today’s hyper-competitive retail environment.

For example, by leveraging hard tags enabled with dual AM and RFID technology, retailers can turn that traditional source tag into a smarter tag and gain better visibility into shrink. The dual-technology approach allows retailers to track shrink loss at the item level and replenish those stolen items in a timelier manner to avoid out-of-stock conditions. It can also provide better insight into where, what, and when items were stolen and further differentiate between actual store shrink and other forms of inventory distortion. And perhaps most importantly, it can enable preventative measures thanks to predictive-analytics capabilities.

This approach also bolsters inventory visibility programs. Beyond better planning and allocation for inventory at the item level, this level of detail can reduce needless markdowns while increasing overall sales and customer satisfaction.

For nearly 50 years, the hard tag has been a critical, trusted component of an EAS system. It is hard to imagine a retail store without them. Much the way our landline phones evolved into smartphones, dual-technology tags and source-tagging programs will prove to be the pathway for the future of smarter, more responsive retailers and happy, satisfied customers.

Return to Tyco March 2015 e-Newsletter