High Growth Areas Projected in the RFID Market

I have been wondering for the last year or so why RFID applications have not been deployed more widely in various industries. I am sure the financial situation has not helped but RFID seems to have a good ROI in many situations. But maybe I am over optimistic and the costs are really higher than I perceive.

ABI has just issued a new report on how RFID is being used or trialed in a variety of industries. Global economic conditions and business necessities have resulted in mixed outcomes but they have identified the three most promising hot-spots as the retail apparel segment, asset management, and active RFID (in a number of verticals).

“2009 has confirmed those assessments,” says RFID practice director Michael Liard. “All three of these RFID application and technology areas have shown strong growth, and today account for 9.3% of the total RFID market, with combined revenues of more than half a billion dollars. We expect the trend to continue in 2010 and beyond: apparel, asset management and active RFID should show a 12.7% combined compound annual growth rate through 2014, outpacing the overall RFID market growth. This is considered strong growth given the level of maturity of many RFID-based asset management applications.”

The adoption of item-level RFID in the fashion apparel market is graduating from pilot testing to full-scale deployment. While installations at Marks and Spencer in the United Kingdom, American Apparel in the US, and Charles Vögele in Switzerland remain the largest contributors to market growth, scores of companies are now in various stages of implementation.

A few years ago at RFID Journal Live I was a part of a demonstration of what we called the "Magic Mirror" that would read tagged apparel and display all of the item details on a screen (intended to be placed next to on within the mirror in a changing room). The display would show all of the colors that were available, the construction and material details and other details about the item. It would also recommend other items or accessories that would match well with the item being tried on (e.g. a nice tie or scarf to go with the shirt or perhaps matching pants or skirts). I thought at the time this would be an immediate hit and prove to enhance sales tremendously.

ABI also thinks asset tracking and management is showing particular applicability to work-in-process tracking, including spare parts and tools; Returnable Transport Items (RTIs); IT asset management; medical assets, rental item management (library books, media, laundry, etc.); and yard management.

They also state that active RFID-based solutions, including real-time location systems (RTLS), is expected to experience solid growth in a number of verticals, such as healthcare, manufacturing, aerospace and defense, transportation, and commercial services, in support of asset tagging, people tracking, and more.