Retailers take shoplifting into their own hands with online readers

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Marie Hartley, a 33-year-old sales clerk from Huntington, Indiana who loves bargains, was surprised to discover a tag with a metallic squiggle attached to a bra she bought online at Victoria’s Secret in January.

She has purchased items with these kinds of tags in Victoria’s Secret and Walmart stores before. But since she stopped shopping so much in stores during the pandemic, she had yet to see one while shopping online.

“I’m used to the big, plastic, bulky ones that were burglar-proof,” she said. “The newer ones are super thin and you barely notice them.”

Months after a series of high-profile retail thefts, retailers are looking to turn the itchy tags attached to the back of a blouse or a new pair of jeans fresh off the rack into more sophisticated covert tracking technology used to set off store alarms or help identify stolen products being sold online.

While there is no specific data on how many retailers are using radio frequency identification, or RFID, technology to track shoplifters, about 15% of retailers have adopted it, according to retail security experts.

An RFID tag attached to an online purchase at Victoria’s Secret. Mary Hartley

Victoria’s Secret, among other retailers, attaches the tags to online orders to track goods through its supply chain, said company spokeswoman Brooke Wilson. It also tests beacons to prevent theft, she added.

“What you’re seeing now in retail and the staffing challenges for law enforcement is a greater need for retailers to consolidate cases to do all of the investigation,” said Joe Coll, vice president of asset protection, operations and strategy at Macy’s. a webinar last week hosted by the trade publication RFID Journal. “RFID gives you that capability.”

But while retailers say the technology helps them track inventory and prevent theft, some consumer advocates worry about shopper privacy. Although the tags can be removed by customers once they leave the store and alone do not allow stores to identify shoppers, privacy advocates are concerned that customers could be tracked through stores without their consent.

“They’re basically just a bit of technology and they have a bit of data in them that’s usually a unique identifier,” said Eric Null, director of the privacy and data project at the nonprofit Center for Democracy and Technology. . “So anyone with access to a reader can track that RFID wherever they go if they want to.”

RFID has privacy implications, particularly due to a company’s ability to track people inside their store to deliver very finely targeted advertisements based on a shopper’s movement patterns or if and where a person lingers, he said.

However, retail security experts point out that this technology is not very sophisticated. It doesn’t allow retailers to track a customer’s whereabouts at scale if they’re wearing the clothes, and can’t even help track items if they’re stolen or lost. Instead, RFID chips require specific reader guns to access the information in the tag and those reader guns only work at a distance of 10 to 30 feet, said Dean Frew, chief technology officer. and Senior Vice President of RFID Solutions for SML Group. This would make it nearly impossible for someone without an RFID gun to read the tags from afar, he said.

“What’s going to be attached to this file is not what you think,” said Read Hayes, director of the Loss Prevention Research Council. He added that the label includes data such as the size or color of clothes or shoes. “It’s not ‘I’m Read Hayes. I live at this address and this is what I earn.

Change plastic

In a retail store, RFID tags originally took the form of hard plastic pins attached to products that could not be removed without a magnetic device at a checkout counter by a store employee. But now they usually appear as small metallic prints on a fabric tag with a garment’s sizing and cleaning information. Devices contain a tracking number associated with the model, color or size of that particular item.

These tags have traditionally been used by retailers to track products through the supply chain and to alert store associates when an item might be low and in need of restocking. But with RFID tagging becoming more common, retailers have started using the tags to combat theft. Customers can remove tags once they have purchased the item.

As an early adopter of the technology, Macy’s has used RFID to track items for theft prevention since 2014, according to company spokeswoman Karina Frayter. The department store has installed “smart exit” sensors at customer and employee store exits, equipped with technology designed to recognize a tag’s merchandise number, Coll said. If the store suspects the item was stolen, Macy’s can then review the video footage and determine who stole the merchandise, he added.

“It was basically like bringing the TSA to our exits in our stores having the ability to really understand with a significant level of confidence what product was leaving our building,” he said, referring to the Transportation Security Administration.

The technology also helps Macy’s determine what types of items are most likely to be stolen at what time of year and repeat shoplifters, Coll said. For example, in late summer, the company found shoplifters coming out of the store with stacks of coats.

Growing problem

Retail demand for more robust security technologies has increased over the past two years, according to asset protection experts.

Organized retail theft, in which a group of people strategically and routinely steal from stores, has always been a problem in the retail industry. But what has changed is the public nature of some of the most violent thefts making headlines and the sophistication of security technology that allows retailers to covertly control stores while maintaining a seamless shopping experience. peaceful for consumers, said Wouter Ubbels, vice president of sales. with Nedap, a Dutch RFID company that works with stores such as Under Armor and Sephora.

“A store’s appearance and experience have become so much more important,” he said. “Security has been forced to become more innovative as it is no longer allowed to show you that your customers might be thieves.”

Although the technology is limited, these tiny RFID tags allow retailers to track inventory depletion, which helps alert store managers to potential theft, he said. Stores have real-time insight into what inventory is in the store or if an employee has issued a refund or store credit to someone for tagged merchandise that was never purchased. It can also be used to detect fraudulent returns where someone steals an item from one store and attempts to return it to another store for a refund or store credit.

Tony D’Onofrio, CEO of Prosegur Security, a global security technology company, said retailers are working with the company to upgrade their labeling systems so they can collect more information to help the police in their investigations.

“Retailers want to go faster,” he said. “With the way communication is now, we have to act much more aggressively.”

But as retailers accelerate RFID-based security strategies, consumer advocates worry about how these tags could be used by retailers for marketing purposes without buyer consent.

Stores can use the beacons to track anonymous information about shopper behavior in stores to learn more about consumer preferences without express consent, Null said. Retailers could also share this tracking data with third-party sellers, he said.

“Consent is absolutely necessary (and the bare minimum required) when tracking people’s physical location,” he wrote in an email.

Already, several retailers have experimented with RFID tagging for marketing and consumer behavior analysis. In 2016, Burberry has rolled out RFID tagging on a selection of merchandise at its flagship Regent Street store in London that can trigger a TV display or advertisement when the tag crosses a sensor. Burberry did not respond to NBC News’ request for comment.

A year later, Rebecca Minkoff rolled out a range of “smart bags” designed with an RFID tag that customers can use in their stores and a unique QR code that allows shoppers to engage with the company about their specific product online or receive information about special offers. Rebecca Minkoff did not respond to NBC News’ request for comment.

But Hayes of the Loss Prevention Research Council, said shoppers are generally comfortable giving out some level of information — even if it’s anonymous — for convenience or entertainment.

“If we’re buying online, we’re giving up a lot of privacy versus brick and mortar, because a company isn’t just going to ship something anonymously,” he said.

Regulations regarding RFID tracking technology are patchy, Null said. Europe has developed extensive regulations regarding RFID technology since 2009 requiring retailers to inform customers of its use and the data collected via the tags. In the United States, some states have laws prohibiting unauthorized access to RFID chip data, including California, Nevada, Washington, Alabama, and Illinois. But shoppers are largely at the mercy of retailers’ voluntary disclosures.

“There’s an element of people not knowing,” Null said. “The only limiting factor is the privacy policy and most people don’t read the privacy policies of retailers.”

Hartley said she’s not worried about aftercare, but about perceived health risks. A review of the scientific literature of the World Health Organization show there is no evidence of health consequences from exposure to low level electromagnetic fields such as those needed to read an RFID tag. Still, she thinks shoppers should be aware.

“I believe in personal responsibility and individual personal choice,” she said. “I think it’s important as a person to be aware of what’s around you.”

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