The market for RFID tags saw tremendous volume gains this year. According to research firm IDTechEx, the market for passive RFID tags expanded by 1.12 billion in 2014, growing to 6.9 billion total tags consumed.
Expansion is coming from all parts of the globe, as U.S.-based Macy’s continues its rapid deployment. Meanwhile, UK-based Marks & Spencer announced earlier this year that it would consume 400 million tags in 2014, or about one-third of this year’s new consumption.
In addition, fashion retailer Zara is in the midst of a chain wide rollout of RFID to nearly 2,000 stores. Zara also consumed hundreds of millions of tags this year. Inditex Group, Zara’s parent, expects to have 1,000 stores up and running by the end of the year, with full deployment to 2,000 stores by 2016. It’s possible that Zara alone will consume more than a billion tags annually at full deployment.
Bill Hardgrave, Dean of the Harbert College of Business at Auburn University, says that retailers no longer question whether RFID works or not. He expects continued growth not only from new retailers, but from new product categories.
“There was a recent article in the Wall Street Journal about the Zara deployment, and I’ve had several retailers come to me since then as a result of that article,” says Hardgrave. “These are new retailers that we have not heard from before inquiring about the use of RFID.
“The other thing we are seeing is a lot more interest in other categories besides apparel. Once the infrastructure is in place to tag denims or intimates, it becomes much easier to roll out new departments.”
Retailers are expanding from tagging apparel into cosmetics and health and beauty aids, a category that has long been a target for RFID, but only recently has seen a resurgence. Hardgrave says that the electronics sector is also seeing more action around RFID.
Retail apparel, however, will remain the sweet spot for years to come. In its new forecast, IDTechEx says that 25 billion RFID tags will be used in retail apparel and shoes in 2020, with a similar number on other “high value, high complexity mix” items.
Many other segments are taking off thanks to standardized, reliable technology where applications outside of retail are leveraging the considerable investment put in by RFID suppliers to address retailer needs.