Analyst: Wal-Mart RFID Pilot Closely Watched

[Moloch]

For some months, all eyes interested in seeing how radio frequency identification (RFID) tags will perform in real-life retailing scenarios have been on Wal-Mart (NYSE: WMT - news). Earlier this year, the company announced a pilot program aiming to get 100 of its top suppliers started on an RFID program by January of 2005.

That pilot has encountered some bumps, says Yankee Group's John Fontanella. But, all in all, the project is going well, and everyone involved has learned some lessons. One of the most important is that RFID must be a cooperative venture between retailers and suppliers.

In fact, it has prompted other large retailers -- including Wal-Mart competitors Target and Best Buy (NYSE: BBY - news) -- to initiate RFID programs of their own, Yankee's Michael Dominy told CRM Daily.

http://news.yahoo.com/news?tmpl=story&u=/nf/20041222/bs_nf/29218

[Deja Q]

1. They're going to do it regardless of what the majority says. And why not?

They have more money than the naysayers combined.

We have the morals and they have the money.

Anybody else have a problem with this RFID issue? Better give it up. You need money, not morals.

[purduejake]

3. I don't see a problem with the program as it is.

Nobody is taking home products with RFID in them (yet). The technology can still be useful if it doesn't infringe on consumer's privacy.

[ClintonTyree]

6. I'm not taking products home from Walmart, period.

I won't set foot in WallyWorld, Target or any other BigBox mega stores. I don't care if I have to pay more, it's the principle.
I wish there was a CostCo around me, but there's none even close.
If I catch wind of ANY store I shop at using this technology, that's it, I'm done buying there. We've lost enough rights already, I don't want to be tracked by Big Brother any more then necessary.

[TO Kid]

10. RFIDs are out there now

Lots of products have the tags, but like you I'm not particularly worried. The power level of the signal is so low that they can't be tracked beyond the store's exit. This is just a better barcode.

[durablend]

14. Funny how the other stories...

Have been spinning it that companies aren't willing to spend the money as they consider it a waste that they're never going to get a return (of investment) on.

[Born Free]

22. Look for them on products for sexual use

The right wing needs to figure out who is having sex and how much sex they are having, right wingers can't enjoy sex and they damn well don't want anyone else to enjoy it either.... ( couldn't resist the sarcasm)

[Cobalt Violet]

2. What is RFID in plain English?

:dunce:

[Moloch]

4. Radio Frequency ID

Basically, Wal Mart is using RFID to spy on its customers. Scary indeed.

Here's a FAQ on RFID:

http://www.aimglobal.org/technologies/rfid/what_is_rfid.asp

[purduejake]

5. radio frequency identification (RFID) tags

From what I've heard, they put RFID tags on pallets to track where stuff is without having to dig through it. It helps with inventory. I guess the worry is that they will start tagging individual items and start monitoring what you are buying. Please correct me if I am wrong.

What most people don't realize is that stores already keep track with discount cards.

[jmowreader]

9. RFID = Radio Frequency ID

An RFID system is kind of a high-tech bar code. It consists of three things--a device placed on the item (the RFID tag), a device to read the RFID tags, and a back-end database to make sense of the RFID tags.

There are several ways to deploy RFID in a retail setting. The first will be case-level RFID--each box of...oh, furnace filters...will have an RFID tag on the outside of it. If I want to know how many boxes of furnace filters, and more importantly WHICH furnace filters, I've got in the building, I go to the aisle where they're stored with my tag reader. I punch a few keys and...no 20x20 filters? Uh-oh. If these tags are potent enough, we could put an RFID reader on the wall outside receiving and inventory whole truckloads of merchandise as they back up to the loading dock. That's the theory, anyway; whether it will work in practice is another question.

I don't know if unit-level RFID--tagging individual packages--will ever happen, at least on the cheap stuff. The first product I've heard named as a candidate for unit-level RFID are Gillette triple-blade razor cartridges. At $7.50 per four-pack, I can understand why this one came up; the shrink on those must be in the double digits.

I think Wal-Mart is more interested in trending than tracking individual customers because Wal-Mart stands alone among major grocers by refusing to implement a loyalty card program.

[TO Kid]

11. RFID tags are small & cheap

I've seen a lot of RFID tags at the unit level, mostly on items that are high-value and easy to pocket. The tags themselves cost very little to mass-produce with an incremental production cost measured in pennies.

[jmowreader]

13. They are still more expensive than bar codes

If you have a bar code generator for your package layout system (it's a program that costs $199) you can generate a bar code very quickly--feed in the UPC string and the program spits out a graphic which you place in the layout. This then goes to press and is printed on the item's package. IOW, UPCs are free once you've got the five-digit manufacturer's code.

Pennies-per-unit is still more expensive than free.

[left15]

16. The goal is to get rid of even more cashiers

With RFID fully implemented, you would be able to bring your cart up to the cash register, and in a couple of seconds, it could tell you the total for every thing in the cart. Unlike barcodes, each item has a unique RFID tag. So if you are buying 10 identical toasters, and each one has a unique RFID tag, the cash register knows you have 10 items and not just 1.

[MisterP]

15. I believe they're making them quite "loud"--detectable for meters

that's the newest "generation" of RFIDs.
Note the article triumphantly heralding "hysteria quelled." The doubleplusgood forces of progress triumph again over the benighted Luddites! Hail Boeing!
Same song and dance they did with nuclear power and GM food.

[vireo]

7. Check out these sites

http://www.spychips.com
http://www.nocards.org

Both are sponsored by CASPIAN (Consumers Against Supermarket Privacy Invasion and Numbering), the leading consumer/privacy organization involved in the RFID issue.

[mtnester]

8. Another reason for me to continue my more than 20 year boycott of Walmart

I also do not shop at stores that require me to have a "member card" to get sales, or to even cash a check. Around here that means Kroger and Giant Eagle.

If Costco was around here, I would go (central Ohio). So I shop at Meijer or Wild Oats (long drive there), since I do have to get groceries somewhere. Or the North Market as much as I can.

[genieroze]

12. Every food store I go to has a membership card in order to

get the sale items.

[left15]

17. The one I use is one I found on the floor

I have no idea who is getting "credit" for my purchases.

[SoCalDem]

20. At Ralph's you can get one with any name..

I never use my real name or phone number.. They did not verify the info when I "signed up"..:)

[Richard Steele]

21. I do the same thing!

Most stores offer a "keychain" version which will quickly wear through and fall off the keychain...

Keeping my eyes at my feet, I have found SIX of these between my car and the supermarket door in the last 24 months....I use them at random, never had a problem!

[tkmorris]

18. Why Costco then?

You have to have a membership card there just to get in the building, and you present it at checkout too. The information on what you purchase and so forth is logged as well or better than any supermarket chain offering "membership" cards.

Having said that, I do as much of my shopping at Costco as is feasible. I love the company for the way it treats it's employees and it's politics. The place is clean and it's products are quality from top to bottom. I just don't imagine that my shopping habits are any more private there than they are at the local Winn-Dixie.

[EC]

19. If we put little magnics

in our cabinets and drawers would that alter the chip?