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Yes, they could be spying on you – But do they want to?

It’s true - it is technologically possible for retailers to create a system that informs them that you are, in fact, wearing practical and comfortable – but not so hot - granny pants today. But remember, this is true whether they have adopted RFID or not.

spying -in -store -WEB

Technology today opens many windows for "spying" on consumers, and RFID is just one of these technologies. In theory, RFID makes it possible for retailers to register where you bought your coat, what size your shoes are and what degrees the t-shirt you are wearing should be washed in. But this information is not really that interesting and beneficiary for retailers. Besides, this information is already available to them through the use of payment cards, customer loyalty cards, etc.

SPYING WITH TAGS?

RFID and the tagging of items have raised a fierce conversation about privacy issues. There are several websites suggesting that consumers should boycott retailers using RFID to presumably prevent them from "monitoring their customers". They claim that RFID is a severe threat to consumer privacy and some of them even state that there might be other parties involved in the "spying" on consumers, such as governments. Due to such resistance a large European apparel retailer had to publicly announce that they stopped their on-going RFID project. They informed their customers that the company has never used RFID technology nor have they had microchips in their garments. This announcement has raised some questions around the real reasons lying behind discontinuing the project. It seems that the biggest mistake the retailer did in adopting RFID was the lack of information available for the consumers. This lead to situations where consumers felt that they are going to be monitored through RFID chips in the garments.

The truth is that retailers very rarely use tags that leave the store active. The most common uses of RFID tags in retail are:

  1. Hard tags that are removed at the cash register at the point of purchase in order to use the tags again for other garments
  2. Price label tags which are removed when the consumer takes the price tag off
  3. Tags that are automatically deactivated at the cash register when the item is purchased
  4. Tags that are deactivated after a few washes (active only for a very short period of time)

As you can see from the list above, the tags and thereby the garments are only trackable before they have been purchased. After this, they are just as incognito as untagged garments. Tags that are constantly active throughout the whole product lifecycle are more common in other industries than retail, such as laundry service. Durable RFID tags are a genius way to make sure that the right hotel gets the right bed linens and towels back, and that employees get the right personal uniforms back instead of someone else's.

WHAT RETAILERS REALLY MONITOR

The easiest way for a retailer to monitor customers, if they wish to do so, is by using customer loyalty cards. They help retailers segregate customers into groups in order to make their marketing actions more effective.  They base their segregation on previous consumer habits and demographic information and then select what offers they should send to whom. Almost all individual store and retail chains have their own customer loyalty programs, and they are all created to fill the need for information about what consumers buy and are likely to buy in the future. And yes, when consumers fill in the card information for their customer loyalty cards, they voluntarily gave the retailer permission to collect this data. And the truth to be told - most consumers prefer it this way. What's the point in receiving offers for teenage boys if you are a working mom?

PRIVACY IS NOT WHAT IT USED TO BE

Privacy issue discussions have been taking place whenever a new technology (with communication and data collection possibilities) has emerged. The most recent ones are of course the Internet, GPS devices,  mobile phones and the use of credit cards. They all propose a serious threat to privacy. We just got used to them. Nobody is seriously suggesting that consumers should avoid these technologies anymore. But this doesn't mean that we shouldn't have these discussions. Open discussions lead to the developing of laws and standards that aim towards making new technologies safe and comfortable to use for all parties.   The consumer privacy concerns of RFID have been a starting point for several projects, and one of these is an EU-based project called PIA (Privacy Impact Assessment Framework for RFID Applications). PIA helps RFID application operators establish and maintain compliance with privacy and data protection laws and regulations. They also help organizations and other RFID system users manage risks involved in RFID applications. In addition, PIA assists in providing public benefits of RFID applications from the consumer privacy perspective. When retailers involve in projects like this, they make a public commitment to take the privacy issues as a severe concern in order to keep the customers.

BENEFITS FOR ALL PARTIES

The message that retailers adopting RFID should be giving to consumers is: "We are not interested in spying on you. We are adopting RFID to 1) reassure that our shelves are filled with the right products 2) speed up inventory 3) receive real-time stock information and perhaps most important 4) to be able to serve you better in all ways possible." With RFID the future customer experience will be on a whole different level: click & collect services, interactive displays in fitting rooms, info kiosks in the stores and so on. This all makes adopting RFID worthwhile for all parties. (For more meat on the bones, read "What's in it for the customer" by Sini Syrjälä.

In conclusion, if you, as a consumer, are afraid of being monitored through RFID tags, just go ahead and make sure that the sales assistant deactivates or removes the tag before you exit the shop. This is a 100% fool proof way of making monitoring through RFID impossible. Most new data collecting and communication technologies are not so easy to stop. Then, enjoy the improved shopping experience that retailers can offer you with the help of RFID.

If you haven't seen our video on this subject. Check it out here privacy video.

1 comment on “Yes, they could be spying on you – But do they want to?”

  1. Posted 19 September 2012 at 12:08:17

    And all this time people are worried about RFID when ideas of facial recognition are being considered.

    http://business.time.com/2012/09/18/private-eyes-are-retailers-watching-our-every-move/?iid=biz-main-lede

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