Using RFID to improve the customer experience

By Dean Frew, Sr. VP for RFID Solutions and Chief Technology Officer, SML Group.

Dissatisfied and unengaged customers are an unfortunate part of the retail industry. Poor customer service can result in the possible loss of a sale or diminished brand loyalty. However, what is poor customer service actually costing your business?

Research from NewVoiceMedia found that on average UK businesses are losing £12 billion a year due to bad customer service. The study also found that 93 per cent of respondents have abandoned a business because of the service they experienced; with an additional third of 16 to 24 year-olds taking to social media to vent their frustration at poor service.

With the customer experience at the forefront of most retailer's minds, many have adopted strategies to enable them to better support their customers and improve their overall experience. Social media has played a significant role in this with most of the biggest retailers dedicating accounts to answering customer questions, requests and addressing their complaints. However, there is a way that retailers can address the customer experience on the shop floor level to minimise the influx of angry Tweets after they have left the store.

Since RFID's introduction into the retail sector, the benefits have been apparent as it has caused widespread changes across various processes in the industry. By utilising this technology in the most optimum way, retailers can ensure they are creating a new operational benchmark, setting themselves apart from the status quo, by taking advantage of a number of innovations, including item-level inventory management that insures meeting availability and delivery commitments to customers. It will also help the retailer by increasing sales, reducing bloated inventory and enabling effective omnichannel models.

Furthermore, RFID technology can reduce the time employees actually spend taking inventory and managing out of stocks, while increasing inventory accuracy up to 99%. This is where the improved customer service can begin to be explored on the shop floor.

For any retailer, managing stock is not an easy task. However it is at the core of whether customers are satisfied or not. With the use of RFID, this process becomes a whole lot easier. By placing RFID tags on products, retailers can accurately know what is in stock and in which shop, allowing them to track their merchandise with more accuracy and economy.

Some of the biggest retailers around the world are currently utilising this strategy to improve their customer experience. By using the RFID tags to keep track of stock, retail staff can provide a more efficient customer experience because they know exactly where the product is and how many they have in stock, thus being able to help service customers with speed and confidence.

Modern customers now want a seamless omnichannel experience meaning that when they order a product online they want to be able to have a guaranteed fast option to receive that product in their hands. Either shipped to them quickly or by picking it up in the store that same day. Out of stocks and poor inventory management can be a prominent challenge for this which in turn could have a negative impact on the customer's overall experience. However, RFID simplifies the process to make the omnichannel experience more efficient and smooth.

Once RFID for inventory management is implemented, retailers are using "magic mirror" technologies to engage with customers more effectively. A growing number of these retailers that have adopted RFID are using these customer experience portals to help automate assistance from associates in the store as well as automatically present differentiated product information as items are presented to the mirror.

Whilst a lot of retailers have already implemented RFID to improve the accuracy of their inventory, there are other applications that RFID technology can be applied to. For example, RFID tags can be inserted into wristbands which, once loaded with money, can allow wristband payment making a transaction more immediate.

Currently this method is popular at amusement parks, events and festivals as it means that people don't need to carry their wallets around and risk losing or having them stolen. However, there is no reason why retailers couldn't adopt this technology in the future to reduce spending time for their customers. Afterall it is reported to take on average of just 0.5 seconds to complete a transaction.

When RFID technology was first introduced in the 1970s it failed to integrate itself into mainstream businesses, largely due to its high costs. However, in recent years the price has significantly dropped as more and more businesses recognise the value it offers- greater inventory accuracy, reduction of out-of-stocks and an efficient omnichannel experience. If implemented correctly, retailers could see the ROI in matter of months as RFID technology further establishes itself at the forefront of retail evolution.