Sunday, May 29, 2005

The Changing RFID Landscape

(Via RFID weblog) The RFID industry like other emerging industries shall see ore opportunities and dollars not in the hardware side, but,rather,in services. The IDTECHEX view is the emergence of an ecosystem - that shall see hardware companies, system integrators & niche industry players aligning themselves in this fast growing but importantly emerging but rapidly changing ecosystem. The RFID value chain – in left, the chipmakers and material suppliers sell their goods to all comers. The chipmakers generally sell integrated circuits for many purposes and their RFID chips are only a small part of their business. The economics of chip factories and the very similar nature of RFID and non RFID chips dictates this. On the right, the systems providers, integrators and operators and so on specialise in certain applicational sectors such as Savi Technology in military, Trenstar in beer kegs and TransCore in non-stop road tolling. In between, few companies feel their way in this immature business and trying various combinations of hardware, software and other options, neither fully positioned vertically nor horizontally. The big RFID orders have always been in system provision, integration and/or facilities management.

For enterprises and service providers, Barcodes and other disposable artefacts, making the artefact or interrogatory hardware are not a good end point. The big money is in system supply, integration and management. Companies in RFID are adding skills near the end of the value chain- where the big money lies, and companies outside RFID are entering thereabouts too. In the RFID world, nothing is forever, RFID tags with no silicon chip have been the exception – exactly the opposite of the situation with the antitheft tags. That will change, because to achieve the “tag everything” scenario in eg supermarkets calls for tags costing one cent or less and that may be impossible to achieve stably with silicon chip tags – ie with enduring profit for all in the tag supply chain. That means chipless tags such as organic Thin Film Transistor Circuits TFTCs will move to centre stage though the infrastructure will remain largely the same. It means history will be repeated where the large, profitable label market, created for barcodes, largely vanished when barcodes were printed as part of normal graphics on packaging and products. The full paper is available here.

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Wednesday, May 25, 2005

Tracking Supermarket Shopper Patterns

(Via Knowledge@wharton) Wharton marketing professor Peter S. Fader sees the drawing of shopping cart paths - seemingly random lines represent a new dataset showing the paths taken by individual shoppers in an actual grocery store. The mechanism to collect this unique shopping data is called PathTracker. These RFID tags were placed on the bottom of every grocery cart in a supermarket in the western U.S. The signals are used to chart the position of the grocery cart and record its route through the entire store. This data is translated into the computerized, Etch-a-Sketch-like drawings of shopping cart paths. The data charted for the first time by RFID tags located on consumers' shopping carts, has the potential to change the way retailers in general think about customers and their shopping patterns.
Eric T. Bradlow & Jeffrey S. Larson analyze this RFID-captured grocery store data, focusing exclusively on travel patterns without regard to purchase behavior or merchandising tactics. The results, they conclude, challenge many long-standing perceptions of shopper travel behavior within a supermarket, including ideas related to aisle traffic, special promotional displays, and perimeter shopping patterns.
Using a new "multivariate clustering algorithm," they identified 14 distinct grocery store travel paths during short, medium and long shopping trips
. Based on this information, the authors conclude that:
Grocery shoppers don't weave up and down all aisles - a pattern commonly thought to dominate store travel. Instead, most shoppers "tend only to travel select aisles, and rarely in the systematic up and down patterns most tend to consider the dominant travel pattern."
Once they enter an aisle, shoppers rarely make it to the other end. Instead, they "travel by short excursions into and out of the aisle rather than traversing its entire length."
Shoppers prefer a counter-clockwise shopping experience. They tend to shop more quickly as they approach the checkout counters. Shoppers' behavior is driven more by their location in the store than the merchandise in front of them.
The perimeter of the store - often called the "racetrack" - is actually the shopper's home base, not just the space covered between aisles.
Findings such as these will have important implications for store layouts, product placement, end-cap displays, and relationships between aisles and perimeter spaces - not to mention a better understanding of how consumers shop and how retailers and suppliers can respond to these patterns. "There is a tremendous amount of research available on why people buy what they buy, but until now there was really no research on tracking the actual buying decision," said Fader.
Tagging Grocery Carts - The ability to track 'click-to-click' browsing patterns on the Internet allowed researchers, for the first time, to look at visiting patterns along with purchasing. PathTracker provided the same kind of luxury for ordinary retail stores. Fader likes to call this junction between the traditional retail environment and new kind of tracking technology a "golden spike" - not unlike the joining of the East Coast and West Coast railroad systems in the 19th century. Eventually, continued analyses could show shopping "hot and cold" spots in supermarkets, and predict movements and purchasing patterns that could lead to significant retail adjustments.
Next Logical Step : - A study of the "linkage between travel and purchase behavior - Linking specific travel patterns to individual purchase decisions may lead to an improved understanding of consumer motivations for purchasing certain items, and can shed light on the complementarity and substitutability of goods in ways that a more traditional 'market basket' analysis cannot capture. Further exploration of travel behavior, independent of purchase, also seems another promising route for future research." Amazing are the ways technologies advance and find place in real life business scenarios. The full paper is available here.

Monday, May 02, 2005

RFID Adoption Increases

Just came across this interesting fact on RFID deployment :

- 90% of manufacturing RFID projects will focus on data integration
- 60% of manufacturers surveyed by Datamonitor are already working on RFID projects.
- 90% of manufacturers surveyed said their next RFID project will be based on systems and data integration.
- 90% of IT executives surveyed said grid computing was of no relevance anywhere in their product life cycles, and
- 80% say that utility computing is of no use in resource planning or supply chain execution.
My Take: This reinforces the IT view of implementing RFID that the key challenge to surmount is handling the enormous explosion of data that RFID implementation forces on the system - handling massive volumes of data, middleware architecture to handle complexity and volume of data - while processing power and storage requirements are massive - but there is nothing very unique therein - but data explosion brings with it own set of challenges and takes the maximum time and effort in planning, designing, rolling out and maintaining RFID solutions.

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RFID Adoption In Healthcare Industry

(Via RFID Journal) Mark Roberti writes, Hospitals are discovering that RFID is the right prescription for many problems. Mark writes,When deployed properly, RFID can deliver many benefits simultaneously. In the warehouse, RFID can be deployed to increase inventory visibility, reduce labor costs and cut shipping and receiving errors all at the same time. The Jacobi Medical Center in New York City is using RFID wristbands and tablet PCs to reduce manual data entry, improve data accuracy and give staff more time to tend to patients - all while cutting. When fully deployed, the system should save Jacobi $1 million annually. Other hospitals are using RFID to track assets - wheel chairs, defribulators, incubators, even scalpels—and to keep patients safe. As the technology matures and spreads, hospitals will be able to use RFID in their complex supply chains to ensure they are ordering and receiving the right amounts of bandages, sutures, gauze and other goods.
The market for RFID and related technologies in the hospital and healthcare sector is forecast to grow to $8.8 billion by 2010. Aging population, shortages of qualified healthcare personnel and an increase in regulations besides improving efficiencies are driving global RFID implementations. RFID applications go far beyond simply tracking cases of consumer packaged goods in the supply chain. And as more hospitals adopt, prices for RFID systems geared specifically for this industry will drop, and as prices drop, the return will become greater and it will become cost-effective for hospitals to use RFID in more ways, which will increase the benefits even more.

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