What is RFID?
Alastair Hanlon – Chief Commercial Officer
RFID is a term that is often used, but what exactly is it and how can this technology be leveraged to bring intelligence and interactivity to everyday objects? Alastair Hanlon, CCO at Pragmatic, explains the background, benefits and potential of RFID.
Background
RFID, or radio frequency identification, is a wireless technology that uses radio waves to transfer data between two points. Information is stored electronically on an inlay (tag), which consists of an integrated circuit (chip) connected to an antenna. This RFID tag is embedded into a product or package and the stored information is transmitted to a reader wirelessly. Unlike traditional barcodes and QR codes, RFID tags are small, unobtrusive and are normally hidden under the label. Each tag has a unique identifier, enabling item-level digital traceability from manufacture, through the supply chain, into the retail store and home. This technology can be used in a wide range of applications for inventory management, authentication, anti-counterfeiting and consumer engagement, and across multiple market sectors including FMCG, pharmaceuticals, healthcare, toys and games.
Opportunity
The benefits of incorporating RFID into product packaging have already been proven. Brands and retailers trialling this technology are seeing significant improvements in operational efficiency and accuracy using UHF RFID for stock tracking, and consumers are using NFC enabled smartphones to tap and access dynamic product information and promotional campaigns. There is a huge opportunity for RFID technology – in the apparel sector alone it is estimated that the potential market is 80 billion items per annum. However, a reduction in the RFID tag cost is needed to drive adoption of this technology into everyday items which number in trillions. Fortunately, new technologies and production processes are emerging that are significantly reducing the cost of the key components such as the integrated circuit. Finally, the true potential of RFID technology and intelligent electronics is being realised and the prospect of introducing intelligence and interactivity into high volumes of low cost products is becoming a reality.
Next steps
Find out more about RFID tags and learn how RFID can be used for product tracking and consumer engagement.