Auburn’s Dr. Hardgrave Discusses Omni-Channel Retailing & RFID
Introduction
We recently attended RFID Journal LIVE! 2014 in Orlando, Florida. While at the show, we interviewed leaders, systems manufacturers, and solutions providers in the RFID industry. In this interview, we spoke with Dr. Bill Hardgrave, RFID expert and dean at Auburn University's Harbert College of Business.
The RFID Research Center Moving to Auburn University
The RFID Research Center will be relocating to Auburn University, and the transition's target date is June 2014. The center is currently located at the University of Arkansas where Dr. Bill Hardgrave first started the program in 2005.
Dr. Hardgrave served as director of the RFID Research Center until 2010 when he was named the dean of Auburn University's Harbert College of Business. With the center's move to Auburn University, Dr. Hardgrave is officially reunited with the program he founded.
"We're excited, and Auburn is excited to get the lab," said Dr. Hardgrave. "It [the move] makes sense with some of the things that we're doing at Auburn in the area of food safety, food quality, wireless engineering, and our great apparel studies." He added, "I'm excited to be reunited with the lab I helped found. We have a great group coming over, and I'm anxious to get started."
When the RFID Research Center formally opened on June 10, 2005, the program's initial goals were researching the technology, data, and business cases of RFID deployments. The Research Center largely focused on retail and the supply chain, but the University of Arkansas's multidisciplinary expertise allowed the center to branch out into other industries such as agriculture and the cold chain.
Also, the RFID Research Center is one of only a handful of laboratories worldwide to receive Performance Test Center designation from EPCglobal, the Electronic Product Code standards-setting organization.
RFID's History and Future in Retail
At RFID Journal LIVE 2014, Dr. Bill Hardgrave gave a talk entitled Can Online Retailers Be Disrupted? It's a rhetorical question, as Dr. Hardgrave is a firm believer in RFID and its many benefits in retail and the supply chain.
He first began working with RFID at the behest of Walmart in 2003. At the time, Dr. Hardgrave and the University of Arkansas were already working with the mega retailer on a number of information technology projects. When Walmart requested that all of its suppliers begin affixing RFID tags at the pallet and case level to improve supply chain visibility, Dr. Hardgrave started research that eventually grew into the RFID Research Center.
However, as they began analyzing the data from Walmart's tagged pallets and cases, the research suggested that the problems weren't at the warehouse or in the supply chain. Rather, the data showed that the majority of the problems were in the stores themselves. This realization created a shift in the industry as the benefits of item-level tracking became readily apparent, especially in the apparel retail industry.
Disrupting the Retail Industry with RFID & Omni-Channel
Dr. Hardgrave has focused on item level RFID tracking in the retail industry for the past several years, and it was the main topic in his presentation Can Online Retailers Be Disrupted? As online sales have continued increasing year-over-year, traditional retailers are seeing dips in their sales. With the presentation, Dr. Hardgrave's goal was for traditional retailers to see the benefits of RFID and begin thinking about how to employ it in their own supply chains.
"RFID, when used by traditional retailers, could provide the tool, the weapon in their arsenal if you will, to combat the pure online," said Dr. Hardgrave. "RFID provides the capability to compete, and it provides that because traditional retailers can finally become omni-channel retailers."
Omni-channel retailing focuses on providing a seamless customer experience across all consumer purchasing channels. More importantly, omni-channel works toward providing the same experience across each channel.
According to Dr. Hardgrave, traditional retailers must adopt item-level RFID tracking in order to transition to an omni-channel retailing strategy. The item-level tracking provides the inventory accuracy necessary to make the full transition to omni-channel.
“They [retailers] have to know what they have, and where they have it, and you can’t do it without RFID,” said Dr. Hardgrave. “RFID becomes the enabler for omni-channel, and omni-channel becomes the enabler to disrupt the pure online retailer.”
Step One – Master the Inventory Fundamentals
When asked about retailers using RFID to enable interactive shopping experiences like smart dressing rooms, Dr. Hardgrave said, “You have to solve some fundamental problems first. You have to have high inventory accuracy, solve your out-of-stock problems, use [RFID] for loss detection, and be able to locate your products.” He added, “When you solve those four fundamental problems, then and only then can you start what we’re calling second-order use cases.”
In this instance, the primary use case is RFID inventory tracking. Second-order use cases refer to using RFID to enhance the customer's experience through interactive kiosks, smart dressing rooms, and more. "It's those things that will help retailers differentiate themselves," said Dr. Hardgrave. "It's how they use that data and technology to create the ultimate experience for you [the shopper] when you go into the store."
Conclusion
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