Will customers know everything about products with digital ID?

Discussion
Sources: oldnavy.gap.com
Apr 21, 2022

A recent article in Fast Company forecasts a world in which products can tell customers anything and everything about themselves using a digital ID, readable via QR code or NFC tag that contains information about everywhere the product has been and lasts as long as the product does.

The technology is being developed as customers appear more conscious about the provenance of the products they buy.

Assigning digital IDs to products in every category, from jackets to t-shirts to furniture, could lead to the birth of new customer services and business models, according to Natasha Franck, founder and CEO of connected product company EON, as cited in the Fast Company article. In categories like fashion, Ms. Franck sees digital IDs allowing retailers to drive easy re-ordering, styling, care, repair and resale, monetizing at each step in a given product’s lifecycle.

Similar technology is already being deployed in grocery. Recently, global grocery chain Carrefour became the first grocer to utilize blockchain to provide additional information on its organic products in-store via QR code. Scanning a QR code brings customers information about the origin of the product and the pathway it has taken, its level of quality and its organic certification.

Questions remain about how much customers would actually utilize or benefit from this granular degree of information. While many U.S. enterprises have taken steps to improve their sustainable and ethical production profile — and have promoted themselves accordingly — there are examples of companies thriving while doing the exact opposite.

For instance, despite its notorious lack of supply chain transparency and sustainability initiatives, Chinese marketplace Shein remains at the top of the fast-fashion world according to High Snobiety. The warehouse-direct marketplace has generated $15.7 billion in sales and is pursuing a $100 billion valuation.

Privacy could also become an issue were brands to attach a digital ID to every product and track metrics about them. Customers may be uncomfortable about having personal data collected about them and appended to products they intended to eventually resell, and such data could theoretically be used in damaging ways by the new owners of used products.

DISCUSSION QUESTIONS: Do you see digital IDs catching on for all products and, if so, what sort of information will customers expect from them? Will privacy concerns and other downsides prevent the use of this technology for reuse?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"Privacy could be an issue until laws catch up to prevent abuse. But the benefits far outweigh the risks or concerns."
"Consumers are increasingly curious, and increasingly searching for information on sourcing as part of their buying decision."
"In times of a BIG squeeze in prices and incomes, yes, digital IDs will catch on."

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16 Comments on "Will customers know everything about products with digital ID?"


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Dion Kenney
BrainTrust
1 month 4 days ago

Product digital IDs will be one of the great tools to enhance the shopper’s experience. While it might appear that the appeal is in the marketing dimension, the real value will be as an early entrant into the world of Augmented Intelligence – expanding our decision making capability rather than replacing it (Artificial Intelligence). Combined with pattern recognition tools and gamification enhanced interfaces, retailers will have found the Holy Grail of customer shopping experience.

Melissa Minkow
BrainTrust

Some retailers are already doing this in non-digital ways, such as Arket who lists out completely where every material is sourced. It’s certainly a smaller subset of consumers who want this level of transparency, but if retailers keep the higher level information available for shoppers, I do think that ultimately there will be majority interest. For example, instead of sharing every single material and its source, summarize whether or not all aspects of a product are sourced and manufactured ethically and sustainably. The nitty-gritty details don’t matter to shoppers, but the overall ethics and sustainability will.

Bob Amster
BrainTrust

It is a good step towards further improving the customer experience, especially for customers that are interested in maintaining environmental standards, and assuring green sourcing and manufacturing methods for the products they buy. The informational tags should be removable after purchase or they could be used for tracking.

Jeff Sward
BrainTrust

At first glance this sounded like a way to get rid of a bunch of different hang tags. Let the customer scan the code and all that info pops up on their phone. I can see how it could then take the customer on a deeper and broader journey. But how many shoppers will have the patience and curiosity to make that journey?

Brian Delp
BrainTrust

This is already a major feature internationally but has be slow to be adopted in the U.S. Customers want traceability and transparency, but it’s not always at the top of the priority list. There is a balance between form and function, and the more emphasis there is on the form component the less likely customers are to care about the behind the scenes aspects. Although there is a push for sustainability in fashion, for example, fast fashion still dominates with companies like Shein due to the form value proposition.

Suresh Chaganti
BrainTrust

This is exciting technology with practical uses to assure authenticity and safety.
Privacy could be an issue until laws catch up to prevent abuse. But the benefits far outweigh the risks or concerns.

Ken Morris
BrainTrust
I believe digital IDs are the only way to get to real-time inventory and ethical traceability: two key components to compete with the online beast. Understanding what you have and where you have it in real time is essential to allow you to compete in this increasingly competitive market. Understanding where the product came from, how it was made, and by whom is the other half of the equation. Is this product really sustainable, organic, made by adults and not children? And it’s not just the source or history of the product. It’s also selling opportunities. Here’s a use case: A customer is in a clothing store where they shop a lot. When they pass a rack with an accessory that would match an item they’ve already bought, a text or in-app message tells them about this and tells them where to find it on the rack. One more thing about QR codes: While digital ID enables a real-time exchange of information, QR codes are very hands-on and only viable when the shopper is already… Read more »
Gene Detroyer
BrainTrust

In China, much of this is already being done. In Hema supermarkets, even the fish are coded as to where and when they were caught.

I’d like to know what percent of the population truly cares about the product other than the look and feel. How many of us have asked about the sustainable advantage of a shirt, pants, skirt or blouse?

Do you?

David Spear
BrainTrust

Many companies have blockchain POCs in progress and are finding very positive outcomes in a variety of ways. Will every product from electronics to fresh food to sneakers contain a QR code or NFC tag? Probably not all, but many will and it’s a great mechanism for the consumer to get deeper into the shopper journey, to learn more about product origins, product manufacturing, vendor partnerships, sustainability, etc. Privacy remains a huge concern, especially, with opt-in information that could potentially get hacked and shared with bad actors. In Europe alone, there’s been tens of thousands of security breaches based on GDPR standards, but this won’t stop the serious momentum with these codes.

Rich Kizer
BrainTrust

“75 percent of customers worried that higher prices will force them to rethink their financial choices in the coming months and 48 percent thinking about rising prices all the time.” In times of a BIG squeeze in prices and incomes, yes, digital IDs will catch on.

Brandon Rael
BrainTrust

In an era where the customer expects all the product information from sourcing, materials, manufacturing processes, product development, and carbon footprint details, the digital ID and the power of the QR code is a competitive differentiator and a necessity. This is particularly crucial as trust and transparency are critical elements of the end-to-end supply chain and global sustainability initiatives.

Today’s digital-first and empowered customer thrives at having all the information at their fingertips to make informed, educated, and socially responsible product choices. A digital ID has been a vital enabler of the conscious consumerism movement in the past few years. Knowledge is power, and retailers and brands have to provide this level of detail and transparency.

Brent Biddulph
BrainTrust

Consumers are increasingly curious, and increasingly searching for information on sourcing as part of their buying decision. While the “right” technology used to collect and share this information with consumers is still in early stages; experiments will continue as there is no doubt that this data attribute has significant value for all constituents.

Gary Sankary
BrainTrust

This technology will appeal to a specific segment of the market. At this point in time, that’s not a big segment. Companies like Patagonia and Adidas are investing heavily in tech to provide visibility to their supply chain, both for their own internal metrics and because they have a great story to tell. Kudos to them for providing their customers with insights about ethical sourcing and environmental impact.

The reality is the vast majority of apparel sales in this country are what is essentially disposable clothing. Consumers who are paying $10 for a shirt aren’t going to be as interested in the pedigree of that shirt, especially if it drives up costs. That’s where we are right now. I do applaud this innovation as long term I expect more consumers will demand visibility into their products’ source. I suspect we’ll also see more regulatory requirements, especially in Europe, that will help drive adoption.

Lucille DeHart
BrainTrust

Honestly, I really like the idea of product digital IDs. Brands like Boll & Branch tout their cotton sources and customers do have growing interest in factory sources. That said, I don’t think there is much of a need to include care instructions or fabric mix. I see the benefits from a marketing point of view (of course) in that re-sale and vintage products can share their history. The story behind a design, who owned the product last, and where they wore/used the product could add perceived value — think Seinfeld’s George character who thought he purchased Jon Voight’s car.

Brian Cluster
BrainTrust

Consumers’ appetite for data continues to grow. Consider the fitness tracker market which is forecasted to be growing at 19% and may reach $139B in a few years. Fitness-focused consumers are keenly aware of their health and fitness efforts and results over time. Many consumers are just as passionate about the environment and social causes and diversity. More have realized that their choices about clothing, food, and transportation can have an impact on the world. Cause-driven consumers will look for more information and to evaluate product choices and measure their impact over time.

Reliable information, trustworthy information, and data will increase in value as consumers dig deeper for information within the supply chain and want transparency in more of their purchases. Companies that mange their data supply chain better and with safeguards will not only be able to satisfy consumer needs but also be more accurate in their ESG reporting.

Christina Cooley
Guest

Any product information that is easily accessible and clearly details what customers would want to know most about product features, benefits, and pricing provides significant value. Digital IDs definitely provide a fantastic opportunity for products to highlight this key information, while providing a great service to their customers. However, there is never a replacement for human-to-human interaction, so where possible and where it makes sense, having sales reps available to engage with customers to educate and advise will always have the largest impact on the customer shopping and purchase experience.

wpDiscuz
Braintrust
"Privacy could be an issue until laws catch up to prevent abuse. But the benefits far outweigh the risks or concerns."
"Consumers are increasingly curious, and increasingly searching for information on sourcing as part of their buying decision."
"In times of a BIG squeeze in prices and incomes, yes, digital IDs will catch on."

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