Store Intelligence. Retail Excellencecharting a path for electronicarticle surveillance:AM, RF-EAS, and RFID
Executive Summary                                                               Electronic Article Surveillance (EAS) is a...
This paper takes an in-depth look at alternative technologies for EAS, including ways                                     ...
Although technically RF-EAS and RFID both use radio frequencies, they are very differ-            ent technologies, and be...
Low electromagnetic frequencies, like the low-frequency acoustic signals from afoghorn, offer better range, easily penetra...
AM technologies’ narrow (± 1%) frequency band offers better immunity from thespurious signals common to store environments...
Environmental challengesRetail construction standards and practices present unique challenges for EAS technolo-gies at the...
RF-EAS systems are also compromised in detection of small products such as over-the-                                      ...
material by manufacturers or third-party Value-Added Resellers (VARs) offers anotherway to complicate thieves’ attempts to...
One Tagged Item                                                              One Tagged Shirt, Worn                       ...
Higher-frequency technologies are appropriate for less challenging environments andcooperative applications where tags are...
Global strength. Local                                  Leverage our strength and experienceexpertise. At your service.   ...
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EAS Decisions


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EAS Decisions

  1. 1. Store Intelligence. Retail Excellencecharting a path for electronicarticle surveillance:AM, RF-EAS, and RFID
  2. 2. Executive Summary Electronic Article Surveillance (EAS) is an important defense against the rise of casual and organized retail theft. Traditional approaches use Acousto-Magnetic (AM) or Radio-Frequency (RF) technologies developed for EAS (RF-EAS). Retailers are also investigating the adaptation of Radio-Frequency Identification (RFID) technology for use in EAS. The strengths and weaknesses of each approach depend on its underlying technology— in particular, on the frequency and frequency band used to detect tags and labels. This paper outlines AM, RF-EAS, and RFID technologies, and compares their performance in real-world retail environments against the challenges of stores’ physical and electrical environments, product composition and packaging, and countermeasures by thieves. As a leading global provider of integrated retail performance and security solutions, Tyco Retail Solutions helps its retail customers understand and overcome the complexities of implementing an EAS system optimized for their product range, store layouts, and business goals. No single technology will meet the requirements of every retailer. But whether a retailer wants to implement traditional EAS, work toward a converged EAS/RFID solution, or apply RFID technology to EAS, Tyco is ready to serve as a trusted partner and advisor with the knowledge and experience to make their goals a reality. New Challenges for Loss Prevention As brick-and-mortar retailers overhaul their stores and business models to meet new economic and competitive challenges, they face an old adversary. Retail shrink ac- counts for more than $119 billion in direct losses worldwide—1.45% of total retail sales.1 In the U.S. alone, retailers lose more than $35 billion to shrink. Shoplifting accounts for 31% of investigated U.S. cases of shrink, and 25% of those are attributed to Organized Retail Crime (ORC), 2 a fast-growing racket in which thieves steal merchandise for resale in physical markets or online. 3 To maintain profitability without compromising the shopper’s in-store experience and1 Joshua Bamfield. The Global Retail Threat Barometer to deliver the most protection from tight staff and budget allocations, retail executives 2011. (Nottinghamshire, UK: Centre for Retail Research. October, 2011) are reviewing alternative technologies, especially advances in Electronic Article2 Richard Hollinger, Ph.D. and Amanda Adams, M.A. Surveillance. And as more of them adopt Radio-Frequency Identification technologies 2010 National Retail Security Survey. (Gainesville, FL: to help speed up supply chains and manage store inventory, retailers are also looking University of Florida. 2011). for ways to adapt RFID technologies to improve inventory visibility associated3 Tyco Retail Solutions Organized Retail Crime White with shrink. 4 paper, Titled “Building your defences against organized retail crime ”4 Tyco Retail Solutions Shrink Visibility White paper, Titled “Shrink visibility the forensics of integrating item-level RFID and loss prevention” Store Intelligence. Retail Excellence 2
  3. 3. This paper takes an in-depth look at alternative technologies for EAS, including ways that RFID can augment inventory protection. Its goal is to give retail executives a technical background in the strengths and weaknesses of each technology, so they can make confident decisions about how deploy them for maximum protection and cost-effectiveness. EAS technologies Retailers use Acousto-Magnetic and Radio-Frequency EAS technologies in their efforts to protect merchandise against theft. Some also discuss adapting RFID technology— widely used in supply-chain and inventory management—to play a role in Loss Preven- tion. Despite the similarity of purpose, the three technologies are in fact very different— with significant implications for their roles in Loss Prevention. All EAS technologies rely on electronic communication between a controller that sends an electromagnetic signal and a tag to which it responds. The communication links range, noise immunity, ability to carry information, and resistance to countermea- sures determine the effectiveness of a technology—and these factors all depend on the frequency used to create the link: • Acousto-Magnetic technologies send out pulses at a low frequency of 58,000 cycles per second (58 kHz) in a tight band of just ± 600 Hz, or ± 1%. AM systems are “one-bit,” that is, they detect tags designed to resonate at this frequency but send no additional information. • Radio Frequency EAS technologies pulse at 8,200,000 Hz (8.2 MHz, more than 140 times the AM frequency). The frequency band is wider: ± 1MHz, or > 12%. Like AM, RF-EAS detects only the presence of a resonating tag. • Radio-Frequency Identification technology originally was developed for military and space applications5 and the EPC Generation 2 RFID standard is used for store level inventory visibility in apparel retailing. Operating at a frequency from 902 to 928 MHz in North America or 865.6 to 867.6 MHz in Europe, RFID operates in the Ultrahigh Frequency (UHF) band—more than 100 times higher than RF-EAS, and using a much narrower frequency band—about two-tenths of one percent. Also unlike both AM and RF-EAS, RFID is a true communications technology— the RFID tag responds to communication from the RFID reader with data that may include SKU or other product related information, not just confirmation of its presence.5 Mark Roberti, “The History of RFID Technology”, RFID Journal. (Hauppauge, NY: RFID Journal, LLC.) Store Intelligence. Retail Excellence 3
  4. 4. Although technically RF-EAS and RFID both use radio frequencies, they are very differ- ent technologies, and behave differently in every important respect: for this reason, this paper uses the term “RF-EAS” rather than the shorter “RF” to avoid confusion about their capabilities. Figure 1 positions the three technologies along the electromagnetic spectrum with other communications technologies included for reference, and summarizes their key differences.. Naval Communication AM Radio Television Mobile Phones Very Low Low Medium High Very High Ultra High (VLF) (LF) (MF) (HF) (VHF) (UHF) 10 kHz 100 kHz 1MHz 10 MHz 100 MHz 1 GHz AM RF-EAS RFID Acousto Magnetic Radio-Frequency Radio-Frequency (AM) EAS (RF-EAS) Identification (RFID) 58 kHz ± 1% 8.2 MHz ± 12% 904 MHz ± 0.2%(NorthFrequency America) 866.5 MHz ± 0.2% (Europe)Coupling Induction Induction Radiation 101010101Information ! ! 0101010101010 101010101 Tag detected Tag detected SKU-level information Figure 1 Frequency bands used for communications between AM, RF- EAS, and RFID systems and tags, with other communications channels included for reference. RFID specifications are for the EPC Generation 2 standard. (Please consult the text for details.) Why frequency matters Electromagnetic technologies like AM, RF-EAS, and RFID obey the same physical laws as light, sound, and even vibration and ocean waves, so their frequency determines their effective range, antenna requirements, information rate—in fact, everything useful about them. Store Intelligence. Retail Excellence 4
  5. 5. Low electromagnetic frequencies, like the low-frequency acoustic signals from afoghorn, offer better range, easily penetrate moisture and other barriers, travel in alldirections from small, simple sources, can be detected by simple receivers, and aredifficult to block. But like the foghorn’s message, they carry only a minimum of high-priority information. These physical properties make low frequencies ideal for robustdetection of tags in difficult environments or in the presence of countermeasures, solong as the information “payload” is modest. Higher frequencies used for RF-EAS offerlower penetration over a shorter range, require larger antennas, are more susceptibleto moisture and other barriers, making them easier to block—while carrying no addi-tional information. UHF frequencies used for RFID operate directionally over “line ofsight” pathways, and are susceptible to blocking or detuning. In addition, they reflect or“bounce” when they strike objects that impede their transmission—metalsurfaces, for example. But UHF frequencies can carry much more information, sowhen conditions are right they’re ideal for rapid multibit communications like RFID.In addition to frequency, the way in which systems are coupled with tags affects theirperformance in real-world retail environments. AM and RF-EAS systems are inductivelycoupled, that is, the tags resonate when placed in an electromagnetic field of the rightfrequency. But RFID signals are radiated, like radio or TV signals—allowing signals totravel further, leaving systems open to reflected signals from tags far from the exit.Frequency bands and errorsFrequency determines range, penetration, and similar capabilities, but error ratesalso depend on the frequency range, or band, that a controller accepts. A wider bandnot only offers greater sensitivity to legitimate signals from tags, but also accepts morespurious interference from other sources. A narrower band rejects such interference,but at increased risk of missing tags. For EAS purposes, there two types of error (andtwo types of correct outcome), as shown in Figure 2. Tag Present No Tag Present Tag Detected “Hit” outcome “False Alarm” error Tagged merchandise is Nuisance alarms annoy shop- leaving the store—Security pers; waste staff time alerted Tag Not Detected “Miss” error “Correct Rejection” outcome Undetected thefts cut profit Normal shopper departure—no and encourage thieves action requiredFigure 2: Four possible results from an EAS scan, two correct outcomes and two types of error. Store Intelligence. Retail Excellence 5
  6. 6. AM technologies’ narrow (± 1%) frequency band offers better immunity from thespurious signals common to store environments, because electrical noise outside theband can’t be misinterpreted as the presence of an AM tag, and few in-store sourcesproduce noise that resembles AM resonance.RF-EAS accepts a wider frequency band—partly to compensate for its limited range—which opens the door to electrical interference from common store sources, includingelectric door motors, elevators and escalators, fluorescent lighting ballasts, and others.Additional false alarms come from products like coiled extension cords and some elec-tronics, which resonate to the same frequencies as RF-EAS antennas. Another sourceof false alarms unique to RF-EAS is the “Lazarus Effect.” RF-EAS tags are disabled byshort-circuiting them so they no longer resonate to signals from readers. But short-circuiting is an imprecise process, and many “destroyed” tags rise again, like Lazarus, to resonate at frequencies within the wide RF-EAS band of acceptance. This results in an alarm from a tag on a pur- chased item—the worst outcome for customer-satisfaction. AM EAS labels are disabled in a way that doesn’t allow false alarms, and they can be reactivated to facilitate restocking of returned merchandise. RFID tags aren’t disabled at all—cor- relation with POS data identifies an item as purchased. RFID uses even higher frequencies than RF-EAS, but because RFID communicates SKU-level product information and not just presence of a tag, “misreads” are unlikely: detection of an RFID tag requires a valid read of an entire RFID data packet, which is virtually impossible unless an actual RFID tag is present.Much time, attention, and concern is focused on reducing false alarms, because theyannoy shoppers and waste staff time. But silent “miss” errors actually pose muchgreater risks to stores. Misses represent direct losses from merchandise theft, andalso send unmistakable signals to thieves that a store is an easy target. In inventorymanagement RFID applications, misses have low impact: conditions are cooperativeand tightly controlled, and reattempts almost always are possible. But range limits forall RF technologies, and the complete-read requirement for RFID, raise miss probabilitiesto costly levels. And in retail EAS applications, misses undermine the function andpurpose of Loss Prevention.EAS performance in retail environmentsWe can now apply our understanding of the physics of EAS technologies to thechallenges presented by retail environments, products, and dishonest adversaries,and show how actual EAS systems perform in the difficult real world. Store Intelligence. Retail Excellence 6
  7. 7. Environmental challengesRetail construction standards and practices present unique challenges for EAS technolo-gies at the front of the store. AM solutions use robust low-frequency technology thatoffers significantly longer range and is compatible with physical store infrastructures.Therefore AM systems can cover wide entrances and are resistant to shielding frommetal doors and building materials, which means that antennas may be embedded instore surfaces and grout lines, offering a welcoming, unobstructed pathway for shop-pers entering the store.In contrast, RF-EAS antennas must be placed in much closer proximity to shoppers,and far enough away from doors and metal beams. This change can mean sacrificingvaluable front-of-store floor space to establish a “clear zone” in which RF-EAS systemscan work, or an uninvitingly narrow “tunnel” through which shoppers must enter andleave. Not surprisingly, stores work hard and spend much to avoid such layouts, forexample by spacing multiple pedestals across an entrance to overcome RF-EAS rangelimitations.RFID also faces challenges at the front end, but for different reasons. Reflected UHFsignals can travel a long way, so exit-based RFID systems can read tags on merchandiselocated a significant and unpredictable distance inside the store. Protection againstfalse RFID reads usually involves establishing a merchandise-free clear zone at the frontof the store: precisely where retailers prefer to position their most valuable merchandise.But stray RFID reads from reflected signals as shoppers walk by make the correct clearzone area difficult to determine.“Nuisance” reads of tags on merchandise displayed near store exits may occur withall three technologies. But at high frequencies used by RF-EAS and RFID, reflectionsby shoppers and carts are much more significant, and may require establishing amerchandise-free, unprofitable “dead zone” around RF pedestals to prevent false reads.Metal shopping carts also deserve mention as a disabling environmental challenge forhigh-frequency RF-EAS and RFID systems. Shielding by and interference from metalcages is well known as a way to block radio transmission and reception—a fact not loston thieves. Worse, contact with metal directly alters RF antenna characteristics, soclever packing of a metal cart by a thief may render applied RF-EAS tags unreadable.Product challengesBecause of the different frequencies at which they operate, AM, RF-EAS and RFID tagsand labels perform very differently when applied to merchandise. Acousto-magneticfrequencies are indifferent to blocking and interference from these sources, but RF andRFID technologies struggle to read tags placed in or near metal foil packaging, metalproducts, and products with significant water content, including liquor, meat, cosmetics,and other valuable items. Store Intelligence. Retail Excellence 7
  8. 8. RF-EAS systems are also compromised in detection of small products such as over-the- counter medications (which may also involve liquid or gel content and metal foil packaging). On smaller items, the large RF-EAS tag—another attempt to overcome range limitations—must be folded around a product edge. AM tags have a smaller footprint and easily avoid this problem. RFID has made significant progress in markets where these product challenges are absent, particularly apparel. Garments contain little metal and no moisture, and most are large enough to avoid placement constraints. With experience and testing, labels“ Vulnerability to and placements can even be optimized for specific merchandise—and programs such as source tagging certification ensure that EAS tags perform properly when merchandisecountermeasures is arrives in retail stores.a critical differentiator Countermeasures by thieves Environmental and product challenges to EAS technologies are significant, but theyamong EAS change slowly, as technologies improve. The third type of challenge—countermea- sures by increasingly organized and sophisticated criminals—adapts rapidly to LPtechnologies in technologies and strategies, to maximize rewards to thieves and minimize their risks.real-world retail Vulnerability to countermeasures is a critical differentiator among EAS technologies in real-world retail environments. Studies of the feasibility of adapting RFID technologyenvironments.” for EAS, for example, have found that laboratory detection rates drop dramatically in the presence of even the most elementary countermeasures. 6 Actual retail environments are, of course, even more challenging. Shielding Shielding of an EAS tag so its response can’t reach the sensor is the simplest countermeasure thieves adopt. The moisture in a thief’s body is often enough to block signals from RF-EAS and RFID tags, although the low-frequency band used by AM technologies makes it immune to this approach. More sophisticated shields can be crafted by creating metal-shielded “booster bags” from shopping bags, purses, backpacks, and laptop bags lined with the many layers of aluminum foil necessary to defeat AM, RF-EAS, and RFID signals. Such countermeasures can now be detected by “booster bag detector” accessories for EAS pedestals that identify likely thieves as they enter the store equipped to steal. Destruction and Deactivation Removing or destroying EAS tags and labels would seem a straightforward counter- measure. But the vulnerability of different technologies depends on their size, durability, and potential for concealment—and these depend on their underlying technology.6 Bill C. Hardgrave. RFID as EAS: Feasibility Assessment.(Fayetteville, AR: University of Arkansas. December 19, AM hard tags are manufactured from tough plastic, with detachment mechanisms2007). designed for maximum tamper resistance. Embedding labels in product packaging Store Intelligence. Retail Excellence 8
  9. 9. material by manufacturers or third-party Value-Added Resellers (VARs) offers anotherway to complicate thieves’ attempts to defeat them. Because it works with virtuallyany packaging material or process, AM technology is well suited to source taggingapplications. And AM labels, whether applied or sewn in, are smaller, tougher, easierto embed, and harder to defeat than alternatives.EAS performance of RF-EAS tags and labels, and of RFID tags, depends on theirantenna or inlay size, forcing a trade-off between performance and defeat resistance.But RFID is very early in its evolution as an EAS technology, and companies like TycoRetail Solutions are applying decades of experience with AM defeat resistance todevelop creative RFID solutions for packaged goods and apparel.Out of the lab; into the storeThe use cases presented above may seem at odds with laboratory studies, which mayshow AM, RF-EAS and RFID technologies performing comparably in EAS roles. Butthis is precisely because of the differences between the laboratory, where variability isstrictly controlled to assure that results are consistent and reproducible, and the retailenvironment, where variability is the norm. Consider what happens to RFID in EAS ap-plications when confronted with even the most modest challenges. Store Intelligence. Retail Excellence 9
  10. 10. One Tagged Item One Tagged Shirt, Worn Performance by Lane Performance by System 100.00% 100.00% 100.00% 99.44% 100.00% 94.44% 100.00% 90.00% 90.00% 100.00% 81.67% 80.00% 80.00% 70.00% 70.00% 60.00% 60.00% 63.33% 50.00% 50.00% 56.67% 40.00% 40.00% 30.00% 30.00% 20.00% 20.00% 10.00% 10.00% 0.00% 0.00% Center Side Center Side Center Side RF-EAS RFID AM RF-EAS RFID AM Figure 3: Left: comparison of RF-EAS, RFID, and AM loss-prevention technologies to detect a single tagged item carried through center or side lanes of a portal (exit) in laboratory tests. Right: performance of RFID and one EAS technology degrades significantly when the wearer of a tagged shirt crosses the portal. 7 The EAS decision space We’ve seen that AM, RF-EAS, and RFID technologies have radically different capabilities when deployed for in real-world retail environments. But while the technology underlying them may be complex, retailers’ goals for deploying EAS technologies are simple— improve profitability, by: • Protecting merchandise from shoplifting, employee theft, and other forms of shrink • Managing inventories through the supply chain and into the store to maximize visibility and raise efficiency Based on the discussion above, Tyco offers the following recommendations to retailers as they deploy technologies to achieve these goals: 1. Consider your business goals for Loss Prevention, and for your organization as a whole 2. Consider your merchandise mix and items to be tagged7 Bill C. Hardgrave. RFID as EAS: Feasibility Assessment. 3. Maximize the value of current technology investments(Fayetteville, AR: University of Arkansas. December 19,2007). Store Intelligence. Retail Excellence 10
  11. 11. Higher-frequency technologies are appropriate for less challenging environments andcooperative applications where tags are presented for reading. For example, inventoryvisibility in apparel is an excellent fit for UHF RFID technology, and is already deliveringhuge benefits for retailers who have adopted. But harsh environments and non-coop-erative EAS applications present significant challenges for these technologies. Metalsliding doors, packaged goods like health and beauty care, and professional shopliftingcountermeasures like foil lined bags create very adverse conditions for RF-EAS andRFID. When these challenges are present, retailers should consider AM or AM/RFIDdual solutions.A technology partner with experience across the frequency spectrum is an invaluableasset who can help you:• Select technologies that are right for your product mix, store environment, and business goals• Design a transition path that makes the best possible use of your current technology investments• Optimize the performance of your technology solution, even under the harshest conditionsTyco offers retailers the flexibility to choose the technology path that works best forthem, whether this is a combination of AM and RFID or RFID as EAS. Regardless ofyour preferences, Tyco has the knowledge, commitment and resources to optimizeyour technologies for security and store performance. Store Intelligence. Retail Excellence 11
  12. 12. Global strength. Local Leverage our strength and experienceexpertise. At your service. Tyco Retail Solutions, a unit of Tyco International, is a leading global provider of integrated retail performance and security solutions, deployed today at more than 80 percent of the world’sNorth America Headquarters top 200 retailers. Customers range from single-store boutiques to global retail enterprises.1501 Yamato Road Operating in more than 70 countries worldwide, Tyco Retail Solutions provides retailers withBoca Raton, FL 33431United States real-time visibility to their inventory and assets to improve operations, optimize profitability andPhone: +1 877-258-6424 create memorable shopper experiences.Latin America Headquarters The Tyco Retail Solutions portfolio is sold directly and through authorized business partners1501 Yamato Road worldwide. For more information, please visit Raton, FL 33431United StatesPhone: +1 877-258-6424United Kingdom/Ireland Regional HeadquartersSecurity House, The SummitHanworth RoadSunbury-on-ThamesMiddlesex. TW16 5DBUnited KingdomPhone: +44 1932-743-432Continental Europe HeadquartersAm Schimmersfeld 5-740880 RatingenGermanyPhone: +49 2102 7141-0Asia-Pacific HeadquartersNo.26 Ang Mo Kio Industrial Park 2Level 1Singapore 569507Phone: +65 63898000South Africa Headquarters1 Charles CrescentEastgate Ext 4, SandtonSouth AfricaPhone: +086 12 12 400L8822-00 06/2012Copyright © 2012 Tyco Retail Solutions all rightsreserved.TYCO, ADT, SENSORMATIC and the product names listedabove are marks and/or registered marks. Unauthorizeduse is strictly prohibited. Store Intelligence. Retail Excellence 12