Consumer Education is Key to Boosting Awareness and Overcoming Misconceptions about RFID
New research by Capgemini urges businesses to address consumer benefits as well as unfounded privacy concerns
9 February 2005
European consumers are beginning to recognise that Radio Frequency Identification (RFID) technology will bring real benefits to their everyday lives, reveals new research from Capgemini. The majority of respondents said they would buy RFID-enabled products if they meant potentially reducing car theft (70% of those surveyed), faster recovery of stolen items (68%) and improved security of prescription drugs (63%). Additional benefits of RFID identified as important to consumers include improved food safety and quality; faster, more reliable notification of recalls; and faster exit through store checkouts.
However, the study also found that concerns over privacy issues threaten to overshadow the benefits of RFID. More than half (55%) of those surveyed are either concerned or very concerned that RFID tags will allow businesses to track consumers via product purchases, while 59% are worried that RFID tags will allow data to be used more freely by third parties.
Many of the concerns cited - for example, the belief that tags can be read from a distance (named by 52% of respondents) - are unwarranted and probably stem from European consumers’ very low awareness of RFID. Despite the fact that consumers are already benefiting from a number of high-profile European RFID applications, such as the M6 Toll pass and Shell EasyPay, the survey revealed that just 18% of European respondents have heard of the technology.
Yet among those who are familiar with RFID, most view the technology favourably or do not yet have an opinion. Only 8% of European consumers currently have an unfavourable perception of RFID.
“Acceptance of new technologies always has a tipping point at which consumers believe that benefits outweigh concerns. With the right RFID approach and ongoing communication with consumers, the industry can reach this point,” says Ard Jan Vethman, principal consultant and RFID leader for Capgemini’s global manufacturing, retail and distribution sector. “This is good news for retailers and manufacturers operating in the consumer goods industry who are looking forward to rolling out RFID technology. However, our research also shows that there is still work to be done to inform consumers about the benefits of RFID, given that many people have not yet formed strong opinions about the technology but are interested in learning more.”
There is a mixed picture when it comes to European consumers’ views on the impact RFID will have on privacy compared with other technologies. RFID will have a greater impact on privacy than smart cards, believe 46% of European consumers, but only 34% believe it will have a greater impact than camera phones and 42% believe it will have a greater impact on privacy than frequent shopper or loyalty cards.
Vethman explains: “The time is right for companies to define their strategy and business rationale for RFID adoption. Because of the scope and impact RFID will have on operations, it is best deployed in a controlled, step-by-step approach. In parallel with this strategic planning process, organisations need to consider taking action to educate consumers about their plans. For businesses, it’s critical to recognise and emphasise the benefits that matter most to consumers in order to realise the greatest return on their RFID investments.”
This education process should include four main elements, continues Vethman:
- Include consumers in the RFID discussion: RFID is a ‘game-changing’ technology that has the potential to fundamentally alter the global supply chain and the retail experience in the coming years
- Begin to communicate with consumers about RFID sooner rather than later. But remember to speak their language and don’t use jargon.
- Address consumers’ concerns and debunk myths with facts regarding costs and prices as well as privacy, environmental and health issues.
- Take it slow – but don’t take too long to get started. Build consumers’ knowledge base gradually. Most don’t expect to see RFID tags on individual products for a few years yet.
Ends
* RFID and Consumers: What European Consumers Think About RFID and the Implications for Business was published by Capgemini in February 2005. More than 2,000 consumers in the United Kingdom, France, Germany and the Netherlands were surveyed.
About the Capgemini Group
Capgemini, one of the world’s foremost providers of Consulting, Technology and
Outsourcing services, has a unique way of working with its clients, which it calls
the Collaborative Business Experience. Through commitment to mutual success and
the achievement of tangible value, the company helps businesses implement growth
strategies, leverage technology, and thrive through the power of collaboration.
Capgemini employs approximately 60,000 people and reported 2003 global revenues
of 5.754 billion euros.
More information about individual service lines, offices and research is available at www.capgemini.com
