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    Home Latest News
    • Mobile

    How NFC Plus Location Is Changing Product Distribution, Retailing

    By
    Mike Elgan
    -
    February 27, 2015
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      NFC Retailing 2

      An innovative Norwegian company you probably never heard of will demonstrate at next week’s Mobile World Congress the smartest bottle of whiskey ever.

      The company is Thinfilm. And the whiskey is a $200 bottle of Johnnie Walker Blue Label whisky.

      Thinfilm will demonstrate a label it created using its new OpenSense near-field communication (NFC) technology, which it developed for use in an extremely wide range of products, including pharmaceuticals, cosmetics, health and beauty care, and automotive.

      Before we discuss the details of that bottle, let’s talk first about NFC and why it’s so powerful and useful.

      The “near” part is important. One way to look at wireless technologies is the distance they can send data, with mobile broadband, WiFi, Bluetooth and NFC each covering a shorter distance than the last.

      While Bluetooth, for example, usually can’t function beyond 30 feet, NFC won’t work beyond a distance of a few inches. That short range provides both specificity and security.

      But the most powerful aspect of NFC is the fact that because it uses electromagnetic induction to transmit data, one of the objects in this conversation can be “passive”—in other words, something that doesn’t have a power source. That’s why it can be used for objects that themselves are not battery-powered electronic devices—objects like the labels on whiskey bottles.

      Thinfilm’s special label system solves a dizzying array of problems that have long plagued manufacturers, distributors, retailers and customers. The secret sauce is the use of smartphone-readable NFC, plus the ability of these tags to provide information based on context.

      Let’s go through some examples with that bottle of Johnnie Walker Blue Label.

      A case of the stuff arrives at a high-end wine and spirits retailer. As the bottles are placed on the shelf, an employee taps each bottle with a smartphone to make the NFC connection.

      When the employee taps each bottle, a purpose-made smartphone app confirms that the bottles are both authentic and have not been opened. The OpenSense branding is a reference to the fact that Thinfilm’s tag can tell if a product seal has been broken.

      Because tag memory is coded at the factory, the data cannot be electrically modified or copied. If the label says it’s authentic, it’s authentic.

      The tapping process also takes inventory and establishes the location of each bottle (on the shelf, rather than in a box in the back of the store).

      The store owner can now verify that each bottle was checked for integrity and validity as well as the location of each bottle in the store using a cloud-based application. The proprietor can also create NFC-based promotions—say, two for the price of one.

      How NFC Plus Location Is Changing Product Distribution, Retailing

      So along comes a customer looking to buy a special gift for a client. This customer doesn’t know a lot about whiskey, but knows the client is a big fan of Johnnie Walker Blue Label. By using his smartphone and tapping on one of the bottles on the shelf, he can see that it’s definitely the right kind, that it’s verified authentic, that hasn’t been opened and—best of all—that he can buy two for the price of one.

      So the customer buys two bottles (using a tokenized smartphone NFC point-of-sale (POS) system, like Google Wallet or Apple Pay, of course!) to score one gift for a client and one gift for himself.

      The customer brings the bottle home and taps it again with the smartphone. Thanks to the smartphone’s location awareness, the app knows the bottle has been brought home. The Thinfilm system knows the bottle hasn’t been opened, and so the app offers storage tips and other information, rather than the promotional information it displayed at the store.

      After the bottle has been opened, another tap of the smartphone suggests drink recipes and other relevant content, as well as one-tap reordering.

      Thinfilm’s prototype brilliantly illustrates the power of NFC technology combined with location awareness. Let’s review what’s going on here.

      A product, such as a bottle of whiskey, has no battery, no GPS capability, no Internet connection and no ability to run apps. But with a label augmented by something like Thinfilm’s OpenSense NFC tag, a smartphone with NFC capability gives it all those powers for just a moment. The phone becomes a magic wand that transforms an object into one that can provide any amount of information about itself based on the person, the location, the state of the product and other contextual information.

      It tells the person using a smartphone app, “This is what you just tapped; here’s all the information you need to know about it in its current location.” And it tells a remote server, “This specific person touched the label at this time in this location and took these actions.”

      Right now, NFC is viewed by the public as an up-and-coming mobile payments wireless technology. In fact, we’re on the edge of an explosion in growth across many vertical business applications, which thanks to location- and biometric-enabled smartphones, will transform access control, booking, health care, transportation, all kinds of services, delivery, manufacturing and more.

      Smartphone NFC for POS convenience and security is nice. But it’s just one of thousands of potential uses for the technology. The true promise will be realized when that’s combined in creative ways by developers who leverage the smartphone’s other sensors, especially the location electronics.

      Imagine the possibilities when any object can be cheaply added to the Internet of things and made intelligent, interactive and connected by any authorized person with a smartphone.

      Mike Elgan

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