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Juliana Miller

Krzysztof Prugar
2008-04-10

Topic

Technology Advances in Marketing Tools

Introduction

New advances in technology called RFID and biometrics has created new tools

for marketers and retailers to better target consumers specifically based on their "profile".

Among other things, a profile includes the person's tastes, styles, class, and preferences.

The idea behind RFID chips is to physically tag each product in a retailer’s inventory.

These chips are micro-transmitters and can be scanned at a distance potentially replacing

the barcode system. Traditionally, as inventory arrived in crates and pallets to a retailer,

each individual item needs to be scanned. With RFID, however, entire pallets can be

scanned recording the quantity instantaneously. When consumers buy the product at the

register, it is scanned again and deducted from the retailer’s inventory, which notifies the

supplier to prepare another shipment. In addition to refining the "just in time" process,

retailers can track the trends and behaviors in consumption and quantify the relationships.

Walmart has been a large proponent of RFID but is disappointed the technology is

not being adopted more readily. They've recently increased the pressure on their suppliers

to adopt tagging of their products by charging a $2 fee for each pallet that doesn't include

the chips (Techweb 2008). Another application for products that are tagged is to develop

a market for "smart appliances" such as a refrigerator or rubbish-bin that lets you know

when your down to the last soda can (McGoldrick and Barton 2). This way you'll never
forget to buy more the next time you go shopping. Market researchers are also using

RFID chips to collect information on patterns in consumer behavior. In one study

conducted, a team developed an "intelligent" magazine in an attempt to observe the

reading behavior of people in a waiting room. Each page was tagged and could track

when it was turned or how long it took before a page was turned (Riley 2).

In addition to RFID, marketers and retailers are looking towards biometrics to

build a larger profile on consumers by using fingerprints, retinal scans, and facial

recognition systems. TiVo and Microsoft filed patents for a TV remote that scans the

thumbprint of the user and identify the member of the household who is currently

watching (Spangler). Similar to that, Comcast has leaked its intentions to develop facial

recognition software included in the TV or cable box which recognizes the person or

people in the living room and react base on their preferences. According to Gerard

Kunkel, Comcast’s senior VP of user experience, "this type of monitoring is the “holy

grail” because it could help serve up specifically tailored ads" (Albrecht). Others are

experimenting with a newly developed biometric mouse and keyboard, which scan the

user's fingerprint. The prints are used to associate online and offline computer activity to

a specific individual (Pons 4). Everything you do during your daily routine, whether

watching TV, surfing the net, or purchasing groceries would be tracked and recorded. The

next time you log-off your computer and turn on the television to watch your favorite

shows, you could see an advertisement for the items you had just recently browsed for

online.
Analysis

Some of the challenges proponents of RFID and biometric face are resistance from

consumers and vendors alike. The main source of hesitation is for concern over privacy

issues but are ensured that anonymity between the consumer and the marketers would be

preserved. Also, these technologies' supporters attempt to entice vendors by stating it will

help create a competitive advantage and a more efficient target marketing campaign.

Depending on the particular application, some firms could greatly influence the

consumers decision process capitalizing off both impulse and routine shopping behaviors.

Lessons and Conclusions

Although the talk seems to advocate the technology's advantages, it’s worth briefly

discussing the alternative implications. There is a natural conflict of interests between the

marketers or vendors, and the consumer. Its not the desire of an individual person to feel

'targeted' at every place they go whether inside or outside their home. Personalized

advertisements might reduce the tension, but the ubiquity still feels intrusive. Trust is a

major factor as well. These technologies record extremely sensitive information that is

still perceived as an invasion of privacy. Marketers and retail outlets are not the only ones

deploying RFID and biometric technologies. Federal government agencies are employing

private contractors to compile biometric databases that contain retinal, facial, print, and

DNA samples in addition to passing legislation in an attempt to outfit every citizen with

an RFID chip through the RealID Act. Increased executive orders have granted federal

agencies more authority in violating an individual’s privacy directly or through a

subpoena in which a company is forced to comply and release private information. With a
rapidly growing surveillance society, it’s becoming more difficult to go in public without

being photographed. Although government agencies have majority of public spaces

surveilled, the corporation's products and policies serve as the next logical stepping stone

in removing this last semblance of privacy and peace.

Works Cited
"Biometric Marketing: Targeting the Online Consumer." Communications of the ACM
49.8 (2006): 61-5.
<http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=21638982&site
=bsi-live>.

McGoldrick, Peter J., and Peter M. Barton. "High-Tech Ways to Keep Cupboards Full."
Harvard business review 85.3 (2007): 21-2.
<http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=23925561&site
=bsi-live>.

Riley, Katie. "Waiting Room Readership Measurement using RFID to be Tested."


Circulation Management 23.1 (2008): 9-10.
<http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=28683063&site
=bsi-live>.

"Wal - Mart Gets Tough on RFID." Techweb January 19 2008.

Albrecht, Chris. "Comcast Cameras to Start Watching You?". NewTeeVee. 18 March


2008. 6 April 2008 <http://newteevee.com/2008/03/18/comcast-cameras-to-start-
watching-you/>

Spangler, Todd. "Microsoft's TV Ads That Watch You". MultiChannel News. 3 August
2007. 06 April 2008
<http://www.multichannel.com/blog/100000410/post/860012686.html>