How technology can revolutionize the retail industry

The rise of e-retailing, global complexity in the supply chains and changing consumer habits are forcing the retail industry to undergo a transformation. Emerging technologies like RFID and NFC support retailers in overcoming these challenges by creating more efficient supply chain management and enhancing the consumer experience.

RFID based inventory scanning is ensuring that the right products are always available on the shelves and NFC enabled phones, combined with NFC tags, are giving customers access to sophisticated product information in the store.

The retail challenge

Technology is fundamentally changing the world of retail. Advances in technology over the past two decades have pushed shoppers online and away from the malls. While most retailing still occurs in physical stores – 92% in the U.S. – this retail channel is growing in low single digits while e-commerce is growing in double digits*.

Additionally, mobile devices have helped give rise to the ‘showrooming’ trend where consumers look at products in the store, only to order them afterwards online from another outlet for a lower price. Traditional retail outlets are now forced to search for ways to enhance the customer experience in order to draw customers back onto the shop floor and turn them into brand ambassadors. This is even more important in the age of social media where consumers have the power to make or break a brand online.

Increasingly complex global supply chains are another hurdle the retail industry has to overcome. The growth of multichannel retail – fulfilling customers’ needs online and in-store – has led to a more fragmented and difficult environment in regards to fulfilment. Getting the right product to the right customer in the shortest time possible has become the key differentiator for retailers looking to get an edge on competitors.

Emerging technologies like RFID and NFC provide an answer to these new retail trends and challenges as they help to shape the future of retail stores with streamlined supply chains and creative ways of customer experience and consumer interaction.

Shaping the future of retail stores

Mobile Payment

RFID and NFC technologies have allowed retailers to improve the in-store experience by providing personalized, interactive, and targeted content. Innovative examples include personalized marketing offers at targeted locations; display monitors that suggest complementary accessories, or other personalized, interactive programs which can send consumers to the online store while still in the physical shop. This helps to improve cross-selling opportunities while providing the brand manufacturer direct consumer feedback.

RFID technology also enables a more efficient and precise supply chain and inventory management for retailers looking to keep ahead of the multichannel trend. When using fast RFID based inventory scanning retailers always know what is in the shop and the storeroom and can ensure that the right product gets to the customer in the shortest time possible. We all have experienced situations where we have gone into a retail store and found for example the perfect style of jeans but were not able to find the right size on the shop floor. Seeking for assistance from the shop staff often left waiting for an age before getting to know that the right size should be in the store but couldn’t be found anywhere led to leaving the store without purchasing anything. When replacing traditional barcodes with RFID labels, stock can be accounted for much quicker (barcode scanners scan 400 items per hour – RFID scanners scan 19000 items per hour). This leads to increased product availability in the store, a reduction in shrinkage and to items that can be distributed to ‘pick up points’ more accurately.

NXP driving change in retail

Many big retailers are already benefiting from RFID today, amongst them Marks and Spencer, C&A, Macy’s, Saks Fifth Avenue, Walmart and others. Behind the success of this technology revolution are innovative companies like NXP. NXP enables secure connections for a smarter world, and is the world’s #1 Global Identification leader in RFID & NFC integrated circuits (ICs) as well as in UHF with its UCODE product family.

We work closely together with retailers and many RFID ecosystem partners to provide a broad portfolio of contactless solutions for more efficient inventory and supply chain management, brand protection, new creative ways of consumer interaction. We are also instrumental in the delivery of contactless payment, contactless loyalty cards, all tailored for retail applications.

As leaders in mobile NFC we also understand how to blend the worlds of mobile and brick and mortar retail stores to create a holistic and seamless user experience in-store. So while technology has most certainly presented its fair share in challenges to the retail industry, NXP’s technologies, combined with broad solutions of our ecosystem partners, are helping meeting retail challenges and pave the road to new opportunities

* RetailSails 2011Productivity Report


Kurt Bischof
Kurt Bischof
Kurt Bischof is globally driving NXP RFID based marketing activities for retailers focusing on Inventory Management and Supply Chain Efficiencies.


  1. Avatar Leyli Salmanova says:

    RFID has been out there for quite a while and is hardly an emerging technology, but it’s amazing how popular it became in recent years. What do you think made retailers to warm up to RFID? Was it the price drop? Or RFID features (security, additional info delivery, etc) became more important?

  2. Kurt Bischof Kurt Bischof says:

    There are many reasons for the current rise in RFID adoption rate.

    But most important is the fact that the Return of Investment statement is now down to a
    very easy to understand one line sentence:

    “Retailers do see substantial sales increase due to improved availability of products on the shelf .”

    Several big box retailers have shared their experience in public and basically all of them come back to the same positive conclusion.

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