Target Testing RFIDs to Transform Shopping Experience

Brick-and-mortar retailers have been struggling to find ways to compete with the convenience of online shopping. Target might have found a solution — one that leverages radio frequency identification technology (RFID).

Target gave shoppers in New York a glimpse of what the future of holiday shopping might look like, with a new pop-up location called “Target Wonderland” in Manhattan. Target described the pop-up as a “16,000 square-foot part-store, part-holiday playground”. While that was an accurate description, it was also a clever retail IT RFID trial. Target corporate has a vision of a new kind of physical store to compete with online rivals, one that attempts to sidestep the drudgery of shopping by wiping out the need for customers to lug around their purchases through the store’s aisles.

A shopper entering the Wonderland received a custom lanyard and digital RFID key. If they found a product they want to purchase they scan a mini-bullseye tag next to any products they want to purchase. Visitors can choose to register their token and associate the transponder’s unique ID number with their social-media pages, though that is not required. No credit card or other personal information is stored on the tokens, which customers are welcome to keep.

Wonderland also featured a giant Etch A Sketch and interactive features, such as a selfie wall where customers can take a photo with a large display of Disney’s Tsum Tsum stuffed toys. The token can be used to upload the pictures to the shopper’s social-media page, as long as that individual registered the token upon receiving it.

Once a customer has finished shopping, he or she can take the token to the checkout counter, which is fitted with an Apple iPad and an RFID reader. When the token is tapped near the reader, the iPad displays that person’s digital shopping cart. Shoppers can delete items that they might have decided not to buy (or any that their children may have added without their knowledge) and then pay with a credit card or cash as they normally would. The shoppers don’t take possession of those products until checkout.

“There’s no shopping cart, no bag, with guests picking up everything at the end,” said Jenna Reck, a Target Spokesman. “This is a more efficient way for Target as a retailer. We’d be shifting some of that to the back room instead.”

The question remains whether this approach will generate enough new sales—both from existing shoppers buying more stuff and new shoppers lured in by the easier shopping method—to top the higher labor costs.

“RFID is something that we can use in a different way,” Reck said. “We have a lot of information about the ways that our guests shop today. What we’re testing here is what we can do that is different.”

This IT trial isn’t exactly duplicative of real-world Target environments. While the chain had over 15,000 shoppers in the pop-up store, only 16 products were available to purchase compared real-world Target stores that have anywhere from 15,000 SKUs to as many as 105,000 SKUs to manage, according to Reck.