EPISODE 108 : 04/06/2023
John-Pierre Kamel is the Managing Director of RFID Sherpas, a boutique retail consultancy that has helped many retailers and brands craft their RFID and Omni-channel strategies as well as optimize the operational execution and profitability of their programs. John-Pierre has over 20 years of retail solutions experience and is a recognized leader in the commercial dynamics impacting the pace of adoption of RFID in Retail. He is a regular speaker on the value of RFID and has sat on several standards bodies and industry forums, including EPC Global’s Strategic Advisory Council and GS1 Canada’s Standards & Services Governance Board.
Host: Ned Hayes and Ashley Coates
Guest: John-Pierre Kamel
Listen to every episode
Topics discussed in this episode
- Detailed small business insights from Olympia, Washington
- Small business resiliency and adaptation during COVID
- Doubling community outreach during the pandemic
- Opportunities for small business loyalty programs
Watch Spark Loyalty’s Small Business Success Channel
Ned Hayes [00:00:00] Welcome to Spark Plug, where we talk to smart people working at the intersection of business and technology brought to you by SnowShoe. Your smarter loyalty leader, Spark Plug is excited to welcome John-Pierre Kamel to the podcast. JP is the managing director of RFID Sherpa retail consultancy that has helped many retailers craft their RFID and omnichannel strategies, as well as figure out their operational execution and how RFID programs can be profitable. So JP has over 20 years of retail solutions experiences a recognized leader in this space, and he knows a lot about RFID in retail, and he’s a regular speaker on the value of RFID, and he sat in all sorts of advisory boards, including Canada’s GC one Standards and Services Governance Board. So welcome today JP.
John-Pierre Kamel [00:00:49] Thank you so much. It’s great to be here.
Ashley Coates [00:00:52] We’re so excited to be chatting with you today. Let’s start JP with you have a very long career in retail Enterprise Solutions. So what first got you interested in this field?
John-Pierre Kamel [00:01:03] You know, like many people, I kind of fell into retail, so I was working for a while as a as an engineer on the RF side and realized I really did not enjoy designing circuits all day and ended up going to work for a consultancy, small little consultancy called Andersen Consulting, which of course is essential now. And I knew how to spell RFID. And so I was asked to go to a to a meeting that that was being held about RFID and was focused mostly on retail. And I definitely caught the bug and fell in love with it. And as project started emergences throughout 2000 or so, as project started to emerge, I got the opportunity to be on them, ended up leaving the industry consulting and going to NY Y at the time and continued to do RFA Do you work at that way? Actually more preaching at the time, mobility and RFID. And I was lucky enough to be on one of their first projects in the early 2000s and really haven’t looked back since.
Ned Hayes [00:01:57] I know there’s a lot of different technologies out there that provide kind of point of presence checking capabilities. So like the company that sponsors this podcast, Snowshoe has a capacitive touch screen tech that allows for actually locking down a location. NFC has been used similarly, RFID has been used not only for location but also for products. So could you tell us a little bit about like some of the technologies that you know about, just so our audience understands the relative benefits and drawbacks?
John-Pierre Kamel [00:02:29] Absolutely. RFID is really a classification of technology. So NFC is technically an RFID solution. NFC is actually part of the band of RFID solutions, and there’s multiple technologies within that RFID spectrum that range from passive RFID, which, you know, you got your low frequency, your high frequency UHF, which is what you see on most products today and in retail and in the supply chain. And then you actually have Ultra-wide band and active tags, such as what’s used to track NFL players during football games. And that’s actually all RFID tech to give you all the analytics around. And so, you know, RFID really is this really broad spectrum of technologies. And of course, everyone uses RFID for getting in and out of buildings and even using using Tor highways. And so the whole idea behind RFID is using RF frequencies to communicate the identification of of an item. Now, whether that’s to unlock a screen, to get access to a room to rapidly count the inventory in the store, to do a tap and go from a payment perspective, all of those are really a bucket of RFID solutions with different types of tags that enable the communication.
Ashley Coates [00:03:33] And so you work with retailers who use RFID. So I’m curious what kind of data is available when retailers are using RFID technology and then how they use that data?
John-Pierre Kamel [00:03:44] That’s a great question. So, I mean, really from a RFID perspective, when we do work with our clients, whether they be a brand or a retailer or three people, we really like to call these inventory visibility solutions rather than RFID solutions. And the reason is that RFID really is just this big bucket of tech, whereas really we’re trying to solve a business problem and that’s usually what do you have in your store? Where is it in your store? Where is it in your supply chain? How can you actively capture this information? And so usually each RFID tag is embedded with the G10 of a product is actually the future. And I’m getting a little technical, but digital is every single product that has a UPC, it’s got a G10 as the just one standard, and SD ten is a serialized version of that. And so if you think of a shirt that you might be wearing on the rack, the sweater, for instance, you know, you’ve got this in this style, vendor style, color, size, every single one of them has the same barcode from an RFID perspective, Every single one of those is unique. And so they each have a serial number attached to that barcode. And what that allows people what allows retailers to do is understand exactly what you have in your store, allows you to not have duplication counting, as you says, you know, when you’re doing manual counts, if you count the top barcode twice by accident, you actually think you have two when you only have one. By everything being serialized, you will never have duplication reads. And really the key thing that most retailers are trying to get out of this is inventory accuracy and visibility. We like to say it’s a three legged stool, so there’s inventory accuracy. So what do I you know, what do I actually have in my store from a from, you know, what is actually there? So as you know, there’s many different things that change the accuracy of inventory in the stories and addresses that most retailers are operating at about 65% accuracy at the SKU level. And so obviously, when you’re trying to do a promise to a customer, you really can’t promise your product that at 65% inventory accuracy rate and so regular inventory counts of your stores using RFID allow you to keep that inventory level closer to 95% or better. And so, you know, the inventory accuracy piece is a big piece, inventory visibility. So where is it in the store? So most of the time we can understand very quickly is it in the front of house, is in the back of house, is it in a fitting room? And that kind of visibility really helps us track down items, fulfill on the promise, you know, from getting it to that customer as quickly as possible and turning around that order and making it easy for for associates to find products even in store. When a customer comes and asks them, do you have this? I’m sure you’ve lived through that, through that problem of, you know, maybe three systems. There’s there’s one. Do I actually have it in the store? And a lot of the time, you know, the associates even just give up before they even start looking. And so with this, not only do we know there’s one left, I can tell them the last one is in the back of the house in this last leg of the three legged stool is find ability. And so there is a Geiger counter function within the RFID solution that allows people to pull the trigger. And as they get closer to the item, it beeps louder and faster to help them actually locate the item. I like to say that that first beep is the most important. That’s that presence detection beep that says Don’t give up, it’s here. And then it helps the associates actually get to the item, especially if in a field of black pants, for instance, or in a stack of blue jeans, that it’s really hard to distinguish between sizes. That first beep can be the difference between finding it and not finding it. And so those are the three kind of basic, basic foundational elements of most solutions, and it all has to do with the data. Now, how do you use that? Data is really is really interesting. So the most common way of using it is to shore up your inventory numbers so that you can update your available for sale. So if I do council once a week, I saw at my inventory I pushed a new available for sale inventory count at the SKU level back up to my back up to my only system, back up to my planning and allocation systems. And now I can start to do real things from from a store’s perspective and from a systems perspective. I’m taking the guesswork out of what I actually think is in the store. And so I know exactly how many units in the store at every single SKU where they’re what’s not there, which is very important. I could fulfill back into the store from a replenishment perspective. I can, you know, whether that’s sales or whether that’s stolen items or whether it’s missed shipments, whatever the reason is that it’s not there. I can actually push inventory back into the store. I now have an understanding of what’s on the sales floor and what’s in the back of house. And so I can actually push product that’s missing from the sales force. So there’s the other stock, which is the first one. The second one is at a shelf. So this is product in the store but not available for sale for your customers. So getting that back out onto the floor and filling those holes. And then from an organizational perspective, I can start to make better decisions around where do I want to fulfill product from? Do I need to have the safety stock level of three or four to, you know, whatever that number is? Because I’m not sure about my inventory levels. So getting rid of that and being able to open up more inventory to your bopis channels from store channels and really kind of fulfilling on that promise, that’s one kind of big bucket. Another area that we get really excited about is really that convergence of data with whether it be with AI, ML, even with RPAs. So RPA robotic process automation is a simple example, kind of like entry level automation solutions. But one thing that we’ve done, for instance, RPA, is allow you to kind of have views into different systems and do transactions based on them without having to create fully integrated solutions. And so one of the things that we do is we’ll take a look at what’s coming in on the receiving side. So know we have an asset coming in to say here are the boxes and here are the products that are coming in tomorrow’s delivery, and then taking a look at what the system just did, a cycle count. They actually know what’s on the floor and what’s missing from the floor. And it can then take those two pieces of information, mesh them together to say, please prioritize these boxes and work them first, because these are the boxes in this and the 400 boxes that you’re receiving tomorrow, these 60 boxes have items that are missing from the sales floor or that aren’t on the floor. And so the store can actually prioritize those boxes, work them, get that product out onto the floor as quickly as possible, and in a way that was never really possible before, leveraging these different ways of looking at your data together. That might have been a longer answer to your question than you were expecting.
Ned Hayes [00:09:48] That’s so fascinating, though. I mean, there are so many different ways that retailers can use this technology to understand inventory and take control their their knowledge of Sorry. Excuse me. Let me say that again. Yeah, that’s really fascinating, JP because retailers can can use this technology to understand their inventory and to help customers and make the purchase the purchase flow faster and easier for customers. I mean, that’s really what it comes down to it, right?
John-Pierre Kamel [00:10:18] Absolutely. And you know, when we talk about the business case pieces, you know, that’s you know, we do a lot of work with our clients on that business case site as well and is really understanding, you know, how do we get the most out of inventory accuracy and visibility. And so whether it’s making sure that you’ve got an accurate view of what’s in the store, which is always a problem for most retailers, making sure your product is available online so your on floor availability is there and reducing all out of stocks. One of the key things from an Omni perspective is reducing shipments, split shipments and and pick declines. And so we’ve had clients who their entire business cases in built just on the reduction of shipments and the and all the extra costs that go into, you know, having to pick that item from multiple stores and the shipping costs associated with that. And so there’s really many, many different values that that retailers see. And then, of course, you know, you start to see things from an employee benefits perspective. You simplify the process, you make things easier for the employees, and especially in this day and age where, you know, it’s really hard to get your hands on good people and retain people. And and just people are a problem in terms of staffing is a problem, you know, making sure that you keep that simple, easy, something that anyone can do, you really help your best associates perform even better and you help newer and average performing associates perform at a much higher level because you can give them a list of exactly what’s in the store and they can actually transact on that without having to guess where it is. And if it’s actually there. There’s many different areas that this really drives value for for retailers. And that’s why we’ve seen, you know, some of the biggest brands and retailers in the world really adopt RFID. And it’s at all price points. You know, whether it’s Wal Mart or Target or Tesco, you know, right up to Gucci, Louis Vuitton and Chanel, you got, of course, Nordstrom and Bloomingdales and Macy’s and Belk and Dillard’s. You know, Carters recently just won an award for their RFID solution. And then, you know, brands like Nike under Armor, Adidas, Zara, Uniqlo, H&M, Ralph Lauren, Tommy Hilfiger, Levi’s, the list goes on and on of some of the world’s biggest brands who have really started to understand the value of inventory accuracy and started to adopt it into their day to day operations.
Ned Hayes [00:12:28] Right. So you mentioned a number of big brands. I’m just curious if I was a small retailer, mom and pop shop or even, you know, smaller chain like Dutch brothers, how could I use the RFID in my kind of a smaller domain? Is it possible to instrument my inventory even if I’m not at the scale of Wal Mart?
John-Pierre Kamel [00:12:47] Great question. I would say there’s probably a cost benefit, probably somewhere in the order of 20 stores. If you’re if you’re operating at less than 20 stores, it’s sometimes hard to really justify the investment. You still can. We have some of our clients that are DTC brands, for instance, who, you know, they’ve got a fairly healthy online business and they’re looking to move into into stores and physical retail, and they’re looking to do that really well. And so sometimes it makes sense to do that even when you don’t have kind of that minimum kind of threshold of 20 stores. But that really becomes where, you know, whether it be Excel or whatever backup systems you’re using, you know, whether using, you know, something like Net Suite or something else to manage your inventory. And it becomes much more difficult to do that in a way that’s practical, to make sure that you’ve got what you need, taking the guesswork out of that. And so that’s usually where we see that threshold. But the value for those small and medium sized retailers really is there once they have that level of complexity. And I would say what you said was also really important. So apparel and footwear, obviously a lot of what I talked about earlier was apparel and footwear. There is RFID, a fair bit of RFID outside of apparel and footwear. You know, we’re seeing it actually kind of take off in QSR. We’re seeing it in electronics. In fact, in even Walmart and Target have expanded into electronics categories. And, you know, you’re seeing it across the board in many different other areas of retail. You’re seeing it in automotive and tires and batteries. But usually SKU intensive categories are the areas that is most difficult to manage, and that’s where you usually see the most inventory inaccuracies. And so even if you’re a small and medium sized retailer that deals in SKU intensive categories, usually the payback of having that accurate inventory is pretty quick and pretty significant.
Ned Hayes [00:14:28] Right? Got it. So I’m curious about changing consumer behavior. You know, there has been a big surge in buy online pickup at store or, you know, check inventory on my mobile and then walk in. I’m not even buying. I’m just assuming it’s there because my mobile phone told me it’s there. So how has this really changed in terms of your clients or in terms of retailers in general? How can people optimize all of their operations and inventory to meet this kind of shifting demand?
John-Pierre Kamel [00:14:56] It’s a fantastic question. And, you know. Definitely the pandemic really changed the way people shop. The pandemic changed by lines and still from store has been here for a while. Bopis has also been here for a while, but really under a magnifying glass for how retailers are able to fulfill on that promise. Especially where I am, I happen to live in Canada. Our lockdowns are a fair bit longer than than the lockdowns in the U.S. and so access into stores and still inventory became a real problem. And so how do you fulfill that inventory out of those stores to make use of that that inventory? And so what we found is that retailers really had a few choices. They could either suppress some inventory, which is what they generally do. So they say they put some safety stock to say at least if they don’t have at least two or three of these in stock, don’t make it available for my both disorders and potentially don’t make it available for my ship from store. And what RFID inventory allows these retailers to do is sell down to the last unit that has a dramatic impact on margins and availability and also from a bopis perspective, from the available places where customers can go and actually pick up that product. You know, as you know, most retailers the last few years have had played this game with their depth versus breadth, and most of them are cutting down on their depth and moving to a broader assortment in order to try to, you know, manage their inventory a little bit more effectively. But what that leads to is broken styles and broken inventory. From an inventory perspective, being able to promise on something, if you’re saying don’t make it available, if I have less than two units because very quickly, can you get below that two unit threshold and suddenly you’re hiding that from your online channel? And so by doing regular counts, using RFID, and that’s the key thing here. There’s different ways of capturing that information. The most common and cost effective way that retailers enter into the RFID space is using RFID handhelds to count inventories in their stores and their dependance on an associate walking around the store, accounting usually counts at around 20 to 30000 units per year compared to barcodes. That’s the order of several orders of magnitude faster than you could count. You know, a store that has 50,000 units and in under an hour you could do it in under 30 minutes with a couple of associates. And so you can really update your inventory on a regular basis and then get rid of those safety stock thresholds to really make that inventory available down to that last unit. And from a margin perspective, selling down to the last unit has significant impacts on full price sell through and your ability to sell as close to the full price as you can and hopefully sell it out of locations that we’re going to be discounting it so that you’re maximizing your margins and getting that product up to your customers.
Ashley Coates [00:17:33] Thank you for explaining it so well and from explaining how from a customer perspective, this technology really does just make the whole experience better.
John-Pierre Kamel [00:17:42] One thing I didn’t mention, and there’s a couple of retailers who are doing this really well, and that this actually is a question that you asked specifically, which is exposing inventory online. And so product availability is a fantastic customer service, too. And so if I know I have this product in stock and I’m not hiding it from my online channel, I can then make it available for someone to see on their mobile, which hopefully drives them into the store to buy it, or to actually do a bogus order or to order it just as a console from stores. And so there’s a couple of retailers who do this really well. You know, Lululemon is an example of one who’s been doing this for a number of years, who exposes their RFID inventory online. And they updated, I believe, one of the conferences we went to a number of years ago. I think they said they updated every 8 minutes. And so if you think about, you know, how fresh that inventory is and, you know, if it says I’ve got one of the left that I can walk into that store, I could jump into my car and drive down there and be fairly confident that it’s actually going to be there. That changes the game a little bit compared to, well, do I really have it? Is it worth going in? And while losing might have been one of the first to do it, they’re definitely not the only. There are a real number of retailers who are using RFID to drive that inventory levels and make that available to their customers.
Ashley Coates [00:18:50] Well, so let’s talk about RFID Sherpas, which is your company. What do you actually do at your firm? Do you implement and deliver that complete solution? Do you work with partner? What’s your business model?
John-Pierre Kamel [00:19:01] That’s a great question as well. So we like to consider ourselves Switzerland so we don’t resell anything. We don’t resell hardware, we don’t resell software, we sell tags. We really, really like to be the voice of the customer. And so we we come in to our clients, we help them understand, is there a business case? Should they be doing that, you know, helping them look at their omni strategies and their RFID strategies and helping them prioritize the various initiatives? And both. And then from there we help them build the requirements. If we do believe there’s a business case, we will oftentimes help them write our fees and evaluate our fees. We take great pride in helping our clients save as much money as they can and through that RFP process. And then we usually help them with the overall change management program. We do a lot of work and help them process re-engineer a lot of their stores and their DCS to help them take advantage of how they can, how they could really use this data. And then we’ve recently been doing a lot of dashboards and work and dashboard requirements helping them define what the requirements. We. But what we don’t do is we don’t actually do any bits or bytes, so we don’t do any we’re not a systems integrator. We don’t actually, like I said before, we don’t resell anything. We really help our clients get the most out of it. And, you know, one of our clients said this night, and I really liked it, it made me laugh. He called us his B.S. detector is like, I could bring you into a room with the vendors and you guys help us understand what’s real and what’s not real, what’s achievable and what’s not achievable, and help us to really deploy these solutions in a in a cost effective and meaningful way. So, you know, that’s the ultimate that’s the ultimate compliment from our clients. And I think our business, you know, we’re a small company and almost all of our business is word of mouth. And so I think that that’s that’s really a real testament to the work that we’ve done. But we’ve also been really lucky and worked with some really exceptional brands and retailers who have been able to go out and do some really cool things.
Ned Hayes [00:20:50] Thank you for the detail on how your business operates. I’m curious if we could go a step further down into a project that you’ve worked on recently or a client that you’ve advised and how this played out for them. Could you give us an example?
John-Pierre Kamel [00:21:04] Absolutely. So we were brought in recently by the CEO of a apparel and footwear company who was having some real issues on their fulfillment side and on their shrink side. And so generally speaking, we don’t like to start with shrink as a as a key use case.
Ned Hayes [00:21:21] And just to clarify for our audience, when we talk about shrinkage in the retail sector, we’re really talking about people taking product out of the store, shoplifting, people stealing, people, even taking it out of the back door. So shrinkage is a common term for smaller retailers. They may not be aware of it, but what you just said is starting with shrinkage as the problem isn’t where you like to start.
John-Pierre Kamel [00:21:42] Absolutely. We like to focus in on the revenue opportunities. And so for that, for this particular retailer, they had two big they had three big issues. One was them on their army side. So their pick decline rates were fairly high. They had dropped down their thresholds down to a one. So, you know, if you didn’t have at least one in stock, it was being hidden. But if you had two or more, it was available for their omni side and they still were having fairly high peak decline rates and their split shipment rates as a result were quite high. Their average basket size was about 2.5 units per basket and with about 30% pick declines that they were seeing in in their stores, you could see that they were having a fair bit of spit baskets. And so they asked us to come in to take a look to see would RFID help them solve this problem? What percentage of their inventory was currently RFID tags? And if there was an opportunity, you know, if an investment made sense. And so we came in, we did a series of meetings with their executives, went and did a couple of site visits to their stores and into the distribution center, and came back with a recommendation for a pilot. We said, we believe that there’s real value here. We have a model, a business model that we use that estimated costs and benefits for them and said, you know, we think that we should consider doing a pilot, and if you’d like us, we’re happy to document those requirements for you. So that’s what we did. We ended up documenting the requirements and working with them to select a vendor to actually do the pilot. And then they ended up running a pilot and found the results to solve a lot of their problems, especially their picks of the last unit item. So they they found in the stores that they had turned on RFID. And it was it was a little bit of a challenge for them because a lot of their product is not RFID tags. And so they did have to turn on RFID tagging at the distribution center in order for the product to flow into the store, tag for the store to take advantage of it. So very quickly, they found that their pick rates went up, their their on floor availability went up, which was something we weren’t expecting because they have a relatively small stock room. And most importantly, when it came down to shrink, it’s actually really interesting. So doing Cycle Counts, they were started, they were able to do counts. They’re doing them once a day, actually, at least for the purposes of the pilot. Their stores were relatively small, didn’t take them very long to do these counts. And they were actually able to start to see when products went missing and they were able to determine in this and one of the pilot stories that the problem was actually an internal shrink issue, which isn’t always the case, but so it was being stolen by staff and they were actually able to identify when that stuff was going missing because they had counts that were happening, being done regularly and be able to actually go after and find the problem and and get rid of the person who was was doing that. So that was like, that’s not typical, that’s atypical, but that’s an example that we just finished. And then so now they’re looking at, well, what does it mean to go from a pilot to going this across all of your stores? And so there’s a few things that really change the game there. So we’re working with them on the source tagging strategy and on their vendor strategy. So helping them turn on tagging both in their own private label product, but also in the vendors that they sell in your story, helping their vendors who are not, you know, their national brands and their vendors who may not necessarily know what RFID is, helping them understand how they need to do it, what they need to do in order to make that happen. And we’re working through the process of, from an ISO perspective, the redefining their standard operating procedures for the store to help them optimize the the work done in the stores. Usually this is not a short process, so to turn on source tagging is usually at. At least eight months. And it’s not because it’s eight months of work. But, you know, from the time you buy something to the time that product actually arrives in your stores, you know, there’s usually a boat in between and it’s usually about eight months or so, sometimes up to a year between the buy, the making of the product and it arriving in your store. And so you need to plan ahead because you can’t turn this on overnight, especially when you need to do that tagging.
Ashley Coates [00:25:21] So I want to go back to you were talking about how you help your clients with vendor selection here. The best detectors, as you said, when you’re evaluating these potential vendors, what are the key things that you’re looking for in a successful RFID vendor?
John-Pierre Kamel [00:25:36] It’s a wonderful question. There’s four big RFID software players in the market today and are actually a long standing large software company actually just entered into the RFID space, which actually made me pretty excited. I’m pretty sure it scared a few of the existing vendors. But, you know, from a from a strengths and weaknesses, each one of these vendors has their own strengths and weaknesses, and they’re really good at some things and maybe not as good in others. And so as we work with our clients to understand their requirements and we document the requirements, it’s usually very clear, at least to us, who the top two or three vendors might be based on what this particular retailer really needs. Because every retailer has from a macro perspective, you know, everyone kind of is trying to achieve the same thing from a micro perspective. Everyone’s trying to do it in a slightly different way. And so, you know, understanding the differences between those and the nuances really help select the vendor that best matches what the particular client or particular retailer needs. One of the things, you know, ultimately it’s not our decision to select a vendor or not. You know, we help we help we help them understand the pros and cons of each. We help them write the RFP to flesh out really essentially and flesh out what those differences are. But, you know, of course, our clients ultimately make the decision, but there’s also more than just the software and the capabilities of the software. Some of these players are vertically integrated as well, so they may sell tags and software together. They may one of them may be an incumbent vendor already who has a really good relationship. And, you know, you may pick a software that maybe doesn’t meet everything that you have because it’s someone that you really like working with. I like to say that there’s a difference between a vendor and a partner. And so when you start to work with different software companies, you really quickly understand the difference between a vendor, someone who’s going to give you the software and someone a partner, someone who’s going to work with you to get the most out of the software. You the one eye view is more transactional and one is more relationship based. And you definitely see that. And sometimes, you know, sometimes the difference in the way people work is really important to to the retailer. Price is sometimes a big a big piece. I generally try to do everything in my power not to a contract be awarded based on price because it should be based about total cost of ownership and not just about a subscription fee or on a single a single dollar amount. So understanding, how does this fit into your total requirements? Who’s going to be the best partner? And then price is a component of that. But kind of working through all of these different elements ultimately helps us work with our clients to select the vendor that’s best for them. One thing that I did mention, as well as geographical distribution is an important one. So are you a retailer or brand that’s got stores only in North America? Are you a retailer that stores only in Europe or Asia, or do you have stores in all three of those regions or a subset of those regions and then selecting a partner that could support you in all the places where you work becomes really important? You know, from a technology perspective, you know, the architecture is usually pretty important based on what you’ve decided to do. Are you looking for a solution or looking for an on prem solution? So all of those things really come together to help select the appropriate vendors on the hardware, the software and on the tag side. And and ultimately, you know, like I said, I don’t like decisions to be based on price, but we know where the pricing should be. And so we really help our clients kind of at all as they squeeze because that has a negative connotation to it, but get the best value for what they’re purchasing based on what they should be paying.
Ned Hayes [00:29:03] It sounds like you actually offer a lot of value to your clients because you’re able to really help them see comprehensively how this could help them. I’m curious. One thing that we’ve heard from retailers is that creating a memorable experience is one of the keys to get customers to come back and to really reengage with the retail experience to come back. So can you tell us about a situation where you help a customer use RFID or related technologies to create kind of a memorable experience, one that customers want to revisit?
John-Pierre Kamel [00:29:34] Absolutely. There’s a couple of examples that are in different spots of kind of like that purchasing, you know, the purchasing journey that a customer makes. One of which obviously we talked about earlier, which is availability, you know, availability and letting your clients know what you actually have to get them into the store to get it onto the floor is a big part of that experience. So they come in to that product is always there, which is really every single one of our projects, which is that back to. Replenishment piece. That’s a little bit boring. So I’m going to skip that. And there’s two solutions that I’d love to talk to you about. One is an interactive solution. Give me place in the fitting room, or it could be placed on the sales for this particular retailer. It’s actually two retailers in recent history that we worked with on this where you actually have an interactive mirror solution in the fitting room. You could come in with your garments into the fitting room that automatically recognizes what you’ve brought into the fitting room because the RFID tags are there in the read and the reader in the mirror picks it up, can be in the mirror or can be a display that’s off to the side and immediately lets the customers know that you that you know what they have in the fitting room, which from a shrink or from a lost perspective is pretty important because the fitting room is a staging area for a lot of theft. But then it also gives the customers the ability to say, Yeah, I know that you’ve got this. Did it fit you? Did it not fit you? Would you like us to bring you a different size? And so very quickly you could say, you know, I like this one or this one here. I’d like to get a size up or a size down, which then pages someone on the sales floor to bring that for you so the person doesn’t actually have to leave the sitting room, but rather actually brings that product to them. And the conversion rate impacts are actually quite significant. And so what some of the studies have found is that the minute somebody has to leave a fitting room to go and find a different size, the conversion rate for that particular purchase is cut in half. But if you can bring them the product in the fitting room, the conversion rate stays extremely high. And so that that’s that’s a real key there that allows associates, number one, to service the customers in the fitting rooms. But number two gives a new customer experience and attention to detail for that person in the fitting group. It also recommends items that could go with that with that particular purchase. So accessories and other and other items that might go with a shirt or a sweater or a dress that’s been brought into the fitting room and and the customer can simply press the button and an associate will go and bring it to them in the group. And so it’s really creates a unique experience in the fitting room and tries to maximize on the conversion rates in that in that space. Because when you’ve got someone going into the fitting room, you’ve got a customer who’s there to buy. They’re at that point, they’re just not walking around looking around. They’re trying something on. They’re engage the purchase, you know, everything you can do to maximize that transaction, the better. That’s one example. And there’s a couple of places where you can see that no, Ralph Lauren had had a whole series of these interactive mirrors in there in the luxury stores. The secret is got these these installed inside their fitting rooms and a whole bunch of their stores as well. Both very interesting. Completely different vendors were used in both solutions. They also were trying to do very different things. But that relationship with the customer inside the sitting room was critical. And each one another example and actually we’re seeing this pop up more and more is self-checkout using RFID. And so there is actually an arrest, actually. Uniqlo was talking about how they’ve implemented self-checkout. And actually, if you walk into any Uniqlo and many H&M stores now, they’ve got RFID enabled Self-Checkout, which is a completely different experience. You walk over, you drop the items that you want to buy into a bin. It populates them immediately on the screen. You do a checkout and you leave. You don’t actually have to scan each individual item. You know, you’re not going through a process. And we found this checkout process to be extremely frictionless and really seamless. And actually people talk about it when they leave. And we have to go online to whether it be Instagram or TikTok. There are literally dozens and dozens and dozens of videos of people just filming their checkout experience because they’re so kind of blown away by how easy it was to actually checkout using it, using this cool technology. They don’t really understand how it works. It is drop their clothes into the bin that gives them a total they pay. And so, you know, those are two to interesting ones. There’s another solution that I really like that hasn’t caught on in terms of the broad use of it. But in this particular case it was a shoe all. And when you walked over to the shoe wall and you grabbed the shoe off the wall, an LCD that was there actually started projecting information about the shoe that you just grabbed. And in fact, you could actually you could actually tap on it. You can actually see the inventory that was actually in in the store for that particular item in your size, which is nice because, as you know, she was usually one of every vendor style color on the wall and all the inventory is actually in the back. And if you don’t like that, it actually, you know, sorry, if you do like it, it actually tells you other things that you might also like. So it actually showed you other shoes that were in-stock that you might also like. And so again, it’s about engaging with the customer because the minute the customer walks up to that shoe wall to pick something up, you know, that they are looking to be engaged with the product. And these are ways of just enhancing that engagement. So these are all simple ways, those three or four examples of how interactive retail can be used. But also there’s dozens more. But these are just thriving.
Ned Hayes [00:34:37] Well, these are fantastic use cases. I am curious if you know where the future is going for RFID. What use cases will we see in the future that aren’t there yet?
John-Pierre Kamel [00:34:45] So I think most of our clients have started in their store, but that’s been the real focus area now and there’s a number of reasons for that. So inventory accuracy in your store is relatively low, you know, at the SKU level, and there’s been a real heightened focus on that. And I think what we’re going to see and we’re actually already seeing with a number of our clients, especially the more mature clients are, is a progression upstream of using RFID throughout the entire supply chain. And so, you know, we’re seeing it now more and more in the GC being able to do pick accuracy, being able to do automated receipts. So imagine doing 100% audit on the inbound and 100% audit on the outbound to the distribution center in an automated way. Being able to actually see it being picked, packed at the factory, understanding when it actually was created, when it was boxed, where it actually got placed and understanding kind of that whole view of that inventory as it goes throughout the entire supply chain. And then, you know, part of that has to do with sustainability. So understanding, you know, if I know where exactly it was made, how it was transported when it was shipped, you know, you start to get a you know, there’s a sustainability element to that information and an authentication arm to that so that information. And so you’re already seeing luxury brands using NFC as a way of authenticating product. And so that’s another way of using RFID in a use case that’s slightly. So I think you’re going to see that that change in use cases moving further, further upstream. But another way that we’re going to see a big change, there’s some really interesting vendors today who are trying to do this. Is that shift from personal, handheld or dependance on employees to do cycle carts to an RFID system that’s actually embedded in the ceiling that’s more ubiquitous like wi fi. So it could be doing real time inventory counts of your entire store, giving you X, Y, and possibly x, Y, Z locations of all your product in your stores, understanding where it is exactly, and taking away that human element of needing to do a physical count. And also human elements, as you know, introduce errors, you know, whether we want to admit it or not. And so this ubiquitous always on overhead RFID reading solutions, they’re available today. They’re still fairly expensive. But as we continue to see technology change and the price of those overhead readers drop, I believe that we’re going to see a real a real change in the way that that that can be done. The last thing that I’ll throw at you is there’s some interesting RFID technologies on the horizon that have sensors built into them. And so whether it be a temperature sensor, which would be really interested in food, you know, you have movement sensors, you’ve got a whole bunch of different sensors that potentially you can leverage, that can tell you that something is happening. And so these these tags that have these sensors into them, you know, they’re still they’re not here today, but they’re coming. They could be really interesting from unlocking a whole bunch of new use cases that just aren’t there today. But ultimately today it’s focused on inventory accuracy. And I think we’re going to start to see how do you use the data more effectively further upstream. And one example that. I didn’t talk about earlier, which we’re starting to see more and more of, is if I could take the guesswork out of my inventory, I could buy less and I could actually sell the same amount of product at higher margin and do more with less inventory. And so cutting my buys and being more effective with the inventory that I have. We can see we’ve seen retailers cut their buys by as much as 10 to 15% and still be able to fulfill on the promise, maintain margin levels that are even higher. I really, you know, get rid of all that clearance merchandise that they’re trying to liquidate at the end of the year or selling to jobbers and drivers. Of course, I like the you know, lots of different you see the TG of the world and many more because there’s lots of different use cases that are coming. And it really all revolve around how you use this data in a more effective way.
Ashley Coates [00:38:21] Well, JP, thank you so much. You’ve shared so many real world use cases and examples and solutions, and this is just going to be a fabulous conversation to share with our audience. Thank you. We do have one last question as we wrap up, which is what do you want your legacy to be? What would you like to be remembered for?
John-Pierre Kamel [00:38:39] That is a really good question. Obviously, I knew that one was coming. You know, I think my legacy is as much as I’d love to be remembered for helping to shape and bring on RFID and retail, I think I want my legacy to be in the stuff that I do in my community. And so an example, we do a charity events every year called the Camel Cup. It’s a golf and spa event that we raise money for various charities. And, you know, my vision when I started it 12 years ago was it’s really a family affair. So me and my wife, my kids, my family, my extended family all take part in running this and helping hopefully make a change in the community around us. So, you know, we’ve been lucky enough that we’ve been able to build orphanages in Ethiopia with the money. We’ve opened up medical centers in Kenya. We’ve done work with children in orphanages in Egypt, but we’ve done work locally as well with our food banks and our soup kitchens here locally, opening up refrigeration units and and delivery trucks helped organize research around Crohn’s and colitis. So we kind of identify a different charity or set of charities every single year, usually low budget charities that don’t have a lot of money, and we try to raise money for them. So I would love my legacy to be that my kids continue this long after I’m gone and, you know, maybe we could build it up to do even more than we do today, you know, and give back to the community because we’ve been really lucky. And I’d love to to help give back to those who I can.
Ned Hayes [00:39:55] What a fantastic legacy that would be. Yeah. Thank you for sharing that vision with us.
John-Pierre Kamel [00:40:00] Awesome. If anyone wants to go golfing or sporting this summer, let me know. I’m happy to have you guys involved.
Ned Hayes [00:40:06] Spark Plug is a wholly owned property of SnowShoe. Copyright 2022-2023 Spark Plug Media.