RFID Vendors: It's About ROI, Not Price

"The Radio Frequency Identification (RFID) industry’s latest fascination is the ongoing cost reductions associated with RFID infrastructure. First, we saw a flurry of news about reduced prices for inlays and tags. Next came the reader vendors cutting prices. Now, companies are offering free tags and tag placement services. The whole industry has been possessed by the spirit of electronics pitchman Crazy Eddie—their prices are “insane!” How do you make money when you give stuff away for free? Will they make it up in volume? This is not the viable long-term answer for jump-starting the market. The fact is that vendors are headed in the wrong direction, focused myopically on lowering the cost to get people to buy. This is a flawed direction. Only by demonstrating value will people invest. “Tell me why I should invest in RFID” is the question to which end users want an answer. Don’t get me wrong—cost is an important part of the overall answer to the question of what is holding back the growth in RFID. However, customers we speak with are largely unmoved by the price reductions. The questions we get from customers are rarely about who is offering the cheapest tags. 9 out of 10 are from companies asking if anyone has found successful use cases in their RFID deployment." Source: amrresearch.com