RFID Slowly Gaining Ground but Tagged with Cost Concerns

December, 2021

Radio-frequency identification (RFID) is gaining ground in certain industry sectors and applications where its benefits are clear. But although RFID may one day become even more widespread than barcodes, it will take longer than its advocates hope for.

The adoption of RFID has been relatively slow, largely due to its expensive upfront costs. Also, the technology can be confusing because of the numerous types of tags and frequencies and the difficulty integrating the technology into existing systems.

As seen in Figure 1 from our full report, RFID Adoption Trends and Customer Experience 2021, RFID has low adoption and investment rates. On the other hand, two other metrics— ROI and TCO—are moderate. And, on an even brighter note, overall customer satisfaction is high.

RFID 1030x687 - RFID Slowly Gaining Ground but Tagged with Cost Concerns

The satisfaction rating for RFID continues to be high due to its benefits. Advocates of RFID point out that, unlike barcoding, RFID can identify items at a distance, with no clear line of sight required between the reader and the tag. Thus, RFID should be able to identify an item even if the tag is on the opposite side of the carton from the reader, or if the tag is on an item within the carton.

Similarly, an RFID reader should be able to quickly read all tags on cartons assembled in a mixed pallet, without having to first disassemble it. Barcode scanners, in contrast, require a line of sight between scanner and label and generally work only within a distance of a few feet (although with special scanners and labels, barcodes can work up to distances of 20 feet or more). Therefore, RFID is a tool that can increase productivity by reducing time and human errors. Data is readily available, up-to-date, and accurate. Automation eliminates manual engagement, saving money.

“RFID has been slow to gain traction, though it has a lot of promise,” said Tracell Frederick, research analyst/editor for Computer Economics, a service of Avasant Research, based in Los Angeles. “As the costs of readers and tags continue to decline, we do expect adoption to grow, across many industries and use cases.”

Our report, RFID Adoption Trends and Customer Experience 2021 quantifies the current adoption and investment trends for RFID technology, as well as the benefits driving companies to expand their RFID implementations. We assess these trends by organization size, sector, and geography and look at the ROI and TCO experiences of organizations that have adopted RFID. We conclude with practical advice for those planning new investments in RFID.


This Research Byte is a brief overview of our report RFID Adoption Trends and Customer Experience 2021, The full report is available at no charge for subscribers, or it may be purchased by non-clients directly from our website (click for pricing).