NFC Benefits in Retail and the Supply Chain
Posted by Suzanne Smiley on Jun 02, 2020
Introduction
Retail has many different applications for RFID, but the most popular application is inventory management with the help of UHF RFID. NFC, the technology used for smartphone payments and smart ticketing can also be used in retail stores to provide customers with additional information on each product.
The ability to place and use NFC tags on products generally depends on the stage at which the tags can be applied. For all retail products, it is suggested to apply an NFC tag with instructions or information during the manufacturing process, specifically the packaging stage. If access to the product during the packaging stage is not possible, NFC tags can still be applied afterwards with permission from the manufacturer. However, if a retail store is interested in adding NFC technology to provide a better customer experience, other options are available.
NFC: A Brief Overview
Near-Field Communication (NFC), a type of passive RFID, is a form of close contact data exchange. Most NFC-enabled smartphones can act as a reader or a tag, depending on the application. If an NFC tag is placed on an item in a store, a customer can tap their smartphone to the tag in order to read the information the tag contains. iPhone 7 through iPhone X require an app from the App Store in order to read the data, but most other phones like Android phones, Windows phones, and iPhones X+ can read NFC tags natively.
NFC tags are small, typically the size of a half dollar or smaller and can be round, square, or rectangular. They can be also be customized to display a logo, a barcode, QR code, printed text, or a custom design. They can open websites or product specific URLs that can provide customers with information instead of or in addition to printing text directly on the product.
For more information on NFC, check out the links below.
How Can Retail Benefit?
Let’s examine how NFC tags can improve the customer experience across five of the most popular types of retail stores: clothing stores, cosmetic & beauty stores, grocery stores, drug stores, and specialty stores.
First, its important to clarify the distinction between two distinct types of stores for the sake of this article:
1. Brand Specific Retail - Retail stores that manufacturer their own products to distribute to their own retail stores, i.e. H&M, Nike, and Apple Stores.
2. Variety Retail - Retail stores that largely or completely sell a variety of goods manufactured by other brands – i.e. Belk, Ulta, and Target. Some of these stores have an ‘in-house brand’ that they sell as well, and these in-house brands should be considered separately as Brand Specific ‘Stores’.
It’s important to clarify the two types of stores because Brand Specific Retail stores and ‘In-House Brands’ have access to their products during the manufacturing stage as well as at the retail stage. That access allows these types of stores more options for implementing NFC for improved customer experience.
Clothing Stores
Brand Specific Retail
Example: H&M
Retail clothing stores that have access to a product’s packaging can place an NFC tag on an apparel item that can direct consumers to a specific URL. Tagging clothing items with NFC tags provides the consumer with the ability to tap the tag and access data such as:
Variety Retail
Example: Belk
Retail clothing stores that do not have access to a product’s packaging can still benefit from using NFC technology even though they are not tagging specific items. Below are a few examples of how a variety clothing retailer, like a department store can improve customer experience by providing:
Cosmetic & Beauty Stores
Brand Specific Retail
Example: MAC Cosmetics
Cosmetic & beauty retail stores that are brand specific can place an NFC tag on a product for sale or on a tester product directing consumers to a specific URL. Tagging cosmetics or beauty items with NFC tags allows consumers to tap the tag and access data such as:
Variety Retail
Example: Sephora
Cosmetic and beauty retail stores that carry a variety of brands and items can improve customer experience by using NFC to provide consumers easy access to in-demand data. A variety retail cosmetic or beauty store can place NFC tags on store shelves, brand & product displays, and other locations to provide:
Food & Beverage Stores
Brand Specific Retail
Example: Publix Brand Products
Publix carries thousands of brands across each of its large grocery stores, including its own Publix branded items like shredded cheese, butter, and toilet paper. Publix provides their branded items as lower priced competition in store, but can also provide these items with a competitive advantage by tagging them with NFC tags that are encoded with information such as:
Variety Retail
Example: Kroger
Most grocery stores have aisles filled with various types of food items in all sizes and brands, so how can generic grocery stores improve the customer experience while remaining brand neutral? These types of stores can focus on the overall experience in the grocery store by providing information such as:
Drug Stores
Brand Specific Retail
Example: Walgreens Brand Products
While Walgreens carries a variety of brands, the drug store also carries a line of Walgreens brand items like cold medicines, batteries, and band aids in order to compete with higher-price brand products. Tagging their brand products with NFC tags can take users to custom URLs to help them find data related to their item, such as:
Variety Retail
Example: CVS
CVS, just like the Walgreens example above, does have its own line of CVS brand items, but for this example, we are going to focus on improving the customer experience in the store and not tagging specific items. Tagging signs or brand displays with NFC tags around the store can provide a higher level of customer experience by providing consumers with:
Because drug stores also provide services like photo printing and prescription filling, there are additional ways that NFC can provide a better in-store experience.
Specialty Stores
Brand Specific Retail
Example: Warby Parker
Brand specific retail stores are more popular in markets like clothing & accessories, home stores, and boutique apparel brick-and-mortar stores. Small or large brand specific retail specialty stores typically have a lot of information to share with consumers – such as the company’s story, mission, promise, and product information. This information typically separates these stores from big box retailers, but outside handing consumers a booklet upon arrival in store, its hard to provide consumers with a simple, effective and efficient way to learn more. Tagging each product in the store with NFC tags can provide a digital platform to share company and product information such as:
Variety Retail
Example: Dick’s Sporting Goods
A variety specialty store like a sporting goods store can be overwhelming to new customers or consumers unsure about their specific needs. There are a few ways that specialty stores can place NFC tags around their stores to improve the customer experience and provide consumers with information like:
Conclusion
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To read more about Retail applications, check out the links below!