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May 19, 2004

A Digression On Some Minor Consequences Of RFID

Way back in the year 2000 I read a gushing column about The Gilmore Girls a couple of days before the show premiered. I don't remember where, exactly, but the description of the show was sufficient for me to mention to the Sainted Wife, who's watched it religiously ever since.

So, score one for me. Now that the dvd of the first season is out I'm tempted to buy it for her and gain even more points except for one thing--I'm certain either her sister or mother is planning on doing the same, if they havenít already.

Not that they'll give it to her before Christmas. The collection of Xmas presents in SW's family resembles nothing so much as a dray of squirrels collecting nuts for the winter. Presents are bought and wrapped long before they're needed, then hidden away until the cold months. It's not unusual for all the women in her family to announce that they've finished shopping for the holidays before the summer is over.

I may buy the DVD set anyway, and if The Sainted Wife receives another she can return the extra. Problem solved.

But, and this has been a roundabout way of getting to the whole point of this post (something that regular readers should be accustomed to by now), imagine, if you will, that my Gilmore girl dilemma isn't occurring today, but rather sometime in the near future, when RFID tags have become ubiquitous.

Suppose, for instance, that I followed the link above and purchased my Gilmore from Amazon, while the Sainted Wife's mother or sister purchase their gifts from Best Buy or another offline retailer. Right now it doesn't matter which DVD the Sainted Wife uses and which she returns--the unopened one can simply be returned to the brick and mortar store. Amazon may have great customer service, but any way you measure it, returning things to them is a pain in the ass.

However, come the RFID age, each product will have its own unique code, so that the returns desk at a particular Best Buy can easily tell if a certain item was originally bought from that location or not when someone brings it to them.

This is not to say that Best Buy, or any other store, will outright refuse the return, though it is certainly possible that could happen. A store could instead follow the path blazed by bank ATMS and charge a "service fee" for accepting the return, calculating that most people would swallow their annoyance and pay the fee instead of going to the trouble of returning the item to the original place of purchase--which need not be an online store like Amazon. A suitably distant brick and mortar location would serve just as well--or just as ill, from the customer's point of view.

A scenario like the above wouldn't happen that often, and at most is only a minor repercussion of RFID technology. Most people can count on their fingers the number of times they've gotten duplicate gifts in their life, and some stores may simply decide to accept returns for any product they sell, counting on the goodwill created by such a transaction to attract future customers.

Such a scenario however, is inherent in the RFID technology. Once individual products can be uniquely identified, the business of selling them will undergo a revolution. Take the Pepsi iTunes contest, where it was found to be possible to identify a winning bottle before purchasing it. Once RFIDs become cheap enough, Pepsi could base future contests on the tag numbers instead of going to the expense of printing different bottle caps. Winning bottles could then be identified at the point of sale. Not only could societal hacks like the one for the ITunes giveaway be prevented, (though there would undoubtedly be new hacks developed), but Pepsi's marketers could guarantee that promotions like the iTunes contest would result in 100% winner notification--enabling campaigns like the giveaway to penetrate the market to a previously unheard-of degree.

Most of the concerns surrounding RFID at present have to do with privacy, but even with the (seemingly unlikely) adoption of strict privacy controls RFID will change the face of the marketplace in ways hard to conceive of at present.

Posted by Bigwig at May 19, 2004 03:11 PM | TrackBack
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Either the POS terminal would have to have internet access to check for winners, or win/lose would have to be encoded in the RFID in a pretty plain way...

In which case hand-held RFID scanners will be very useful.

(Or, sure, Pepsi could encode it and distribute a piece of hardware to decode and say Win/Lose, but I bet someone would have that blackboxed pretty fast.)

I also suspect the real reason redemptions were so low was that nobody wants to type in the damned code to get a 99 cent song.

Posted by: Sigivald at May 19, 2004 05:26 PM

A recent experience that generates a thought:

My husband purchased some garden lattice from X store, and returned it to Y store. Had a bit of grief (no receipt) and improper tagging; but the manager agreed to the return when my husband said, "well, they couldn't get it to scan when I bought it, and had to look it up."

Ok, ignoring my husband's ethical issues, I wonder what the "percentage" in RFID is? Or will one be able to convince management that "there was a computer snafu at the time of purchase" to enable a questionable return? i.e., is this a quantum leap in technology?

Posted by: cj at May 24, 2004 01:32 AM
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