RFID – Improving the Customer Experience

Citation

Barat, S. (2011), "RFID – Improving the Customer Experience", Journal of Consumer Marketing, Vol. 28 No. 4, pp. 316-317. https://doi.org/10.1108/07363761111143501

Technology is changing every minute. So, unless someone is really savvy about it, the prospect of investigating the latest technological changes may not only be remote, but frankly, quite intimidating. RFID – Improving the Customer Experience, however, belongs to the proverbial “chip off the old block”. It is a book about technology and yet, it is written for the common man. The book shows how the average reader can become more knowledgeable about how we can harness the tremendous power of the chip to improve our everyday life, become more efficient, save time for other important work and yet, cut down cost and wastage while doing all this. The smart marketer can potentially use several ideas floated in this book to give his/her business a jumpstart, establish along‐term relationship with the customer, improve the bottom line of the organization, and in the end, deliver world‐class service!

At 264 information‐filled‐no‐frills pages, this is solid reading for the typical reader. The first chapter introduces the concept of “radio frequency identification” (RFID), which is basically a chip with barcodes that can be inserted in any product. The barcode, which contains critical information about the product and/or its owner, can be read using radio frequency delivered by a transmitter, thereby eliminating the need for human intervention. The second and third chapters illustrate how extensive use of such technology can potentially lead to better customer relationship management (CRM). Chapters 4 and 5 talk about the implications of the technology from the customer's perspective; Chapter 5 is devoted to privacy, safety and security concerns, which play a big role in today's use of technology. Similar concerns are reflected in Chapter 9 (authentication and product safety) and Chapter 10 (admissions, permissions, and tickets). It is perhaps not a surprise why the author spent so much effort on bringing up the privacy and security aspects of the RFID technology, given people's experience swith Internet commerce and credit card transactions in recent years. Chapters 6 and 7 basically reiterate what the first two explained: how RFID can improve the bottom line of the organizations either by providing a new business model through more efficient asset tracking or in a retail environment. Brazeal discusses how other sectors can also be positively impacted by this technology, such as payment systems (Chapter 11) or patient relationship management (Chapter 12, even though PRM is a part of CRM). The environmentally‐conscious consumer can derive solace from Chapter 8, which suggests that RFID is environment‐friendly and if anything, the technology helps reduce carbon emissions.

I feel that the author is fundamentally a superb storyteller plus salesperson. The way he introduces the concept of RFID and associated technology makes even the most “uninterested” reader want to read more. The introduction starts off with a simple question, “Do you remember life before search engines?” He walks the reader step by step as to how things were done in the past and how they can change dramatically if RFID is introduced the way the author suggests; “Suppose that, as suddenly as Spiderman, you get this superpower; you can know exactly where things are” (p. 1). Brazeal moves on to explain how RFID can assist just‐in‐time inventory management or lead to a paradigm shift in customer service (p. 3). He introduces a step‐by‐step guide to incorporating RFID in today's business (p. 7), including mundane operations such as washing clothes (p. 13)!

It is commendable how in Chapter 2 the author presents the concept of CRM in a no‐nonsense manner: “Supermarkets offer special lanes to give some customers faster service. The sign over those lanes says ‘Ten items or less’ or ‘Fifteen items or less.’ In a rational world, the sign would say ‘$12,000 a year or more’” (p. 19). Once again, not everything in this chapter is new … management and marketing gurus have been talking about CRM and customer values for years. But it is the way that the material is presented and the anecdotal examples provided that make the book worth reading. For example, Waterparks get extra sales from kids who can purchase refreshments using wrist‐based RFID tags without their parents' intervention.

The CRM theme is continued in the next chapter, which suggests the following principles of CRM and how RFID enables them:

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  Identify and respond to the fact that customers are different.

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  Focus more on retaining existing customers than on acquiring new ones.

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  RFID can be used to enhance customer relationships.

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  Personalization is a key incentive/reward for relationships.

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  Relationships must be managed across marketing, sales, and customer service.

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  Loyalty is an ultimate measure of customer service.

In Chapter 4, the author tries to underline the importance of the customer experience and how to manage it effectively. Interestingly, he notes that even though 80 percent of companies believe they deliver a superior performance, only 8 percent of customers actually believe they are getting such an experience, which is a classic example of the “service‐quality gap” model. In fact, the author further notes that 80 percent of Americans have stopped doing business with a company because of unpleasant experience. Chapter 4 concludes with a mention of the limitations of RFID. Concerns include privacy issues, breakdown of the application itself, inadvertently embarrassing the customer, a process taking longer than expected, and giving customers the benefit to opt‐out. In my opinion, it is critical that the manager takes note of such limitations before installing RFID technology … if anything, paying attention to these limitations will only strengthen the case for RFID!

In Chapter 5 on personal identification and privacy, Brazeal reveals some interesting anecdotes about the vulnerability of the common man to hackers of personal information. The author's sense of humor is evident in the following two comments, “Think about the logic of using low integrity ID to qualify for a high integrity ID” (referring to the system of using a driver's license to obtain a birth certificate or social security number) because “The only thing that prevents mass forgery of these low integrity identifiers is the fact that it's quite convenient to forge the license itself” (p. 54). From this perspective, therefore, RFID has several (potential) advantages, such as automatic readability, or an on/off switch if the owner does not want his/her RFID to be “identified”, tag killing, blocking or read range. Specifically, Brazeal tries to show the advantages of RFID tags over existing bar code tags, especially in cases of baggage handling, be it for the handlers or for the customers. Some companies such as ZipCar already are providing such value‐added services, where a renter can locate a car remotely, get to the car, and drive away after punching in another PIN as an added level of security. A kid comes back home from school and the RFID on his person is read by radio signal, which sends a message to his parents that he/she is home. RFID is also useful for time‐sensitive products such as storing blood and plasma or tracking buried cables.

However, I am both fascinated as well doubtful about some of the retail applications of RFID that the author suggested in Chapter 7. For example, I would like to know the source of some of the statistics (70 percent of purchase decisions take place at the point of sale) and of the idea that grocery customers can speak the name of a product they want and an RFID‐fitted screen on their grocery cart will tell them where the product is located, the food value, and other pertinent details. Not only is this idea susceptible to more grocery cart accidents, but it also belabors the obvious. Such information is already available in the stores through multiple modes, so why spend more money? If anything, it will slow down the process of shopping. The author also touts the idea of creating a grocery shopping list on the computer, taking a printout etc., but many retailers already offer such an option on their website. In the author's opinion, RFID fits best in some payment systems, such as in copying centers where everybody is in a hurry (p. 198), enabling the cell phone with RFID features (because it is easier to get out than a credit card), personality coupons, and tactical loyalty cards distributed by retailers. Once again, not all of these suggestions are novel!

Finally, in Chapter 12, the author suggests using RFID for medical purposes. This is one area where I have strong reservations for two reasons. First, RFID is created/operated by human beings, and human beings do make mistakes. As such, suggesting that RFID will make the patient relationship management more foolproof and efficient is a moot point. And second –and perhaps more importantly, medical clerks and receptionists are notorious for committing errors. When we can see something in print, there is still a possibility that the patient might catch the error before it is too late. But when everything happens through transmission of radio signals with no paper trail, such mistakes are highly unlikely to be caught by the untrained eye. Imagine the consequences when a surgeon amputates the left foot instead of the right, just because someone inserted the chip in the wrong patient or in the wrong foot or both! The author himself notes “In a recent 30‐month period, in the state of Pennsylvania, there were 125 ‘wrong site surgeries’ […]” (p. 205), but follows up this comment by suggesting that RFID chips inserted in the body of the patient or with body fluid samples, etc. might reduce such errors … totally wrong in my opinion. The more we become pawns in the hands of technology, the more complacent we become, and the less motivation we have to “check” for human errors.

All in all, this is a book that informs the reader about tremendous possibilities for advancement using the RFID technology. While it definitely makes an interesting and informative reading, the serious reader must take things with a pinch of salt. I also believe that the book could have been about 60 percent shorter than its actual volume, because a lot of the ideas and materials presented are either wishful thinking or already exist in one form or the other.