Dive Brief:

• Untuckit, a casual men’s apparel retailer, is piloting radio-frequency identification (RFID) in a new store on Fifth Avenue in New York City, according to Sourcing Journal.
• The retailer will use data collected by RFID chips on men’s shirts, traffic counters and other in-store data points to identify the optimal merchandising mix.
• Working with Sato Global Solutions, the goal is to give managers better visibility into the movement of merchandise so as to determine customer demand.

Dive Insight:

Untuckit’s business model is based on men’s shirts that are just the right length to look good untucked. To build sales while managing costs, this requires the accurate tracking of inventory, and the retailer recently started piloting RFID technology to do just that.

RFID uses radio waves to read information stored on tags attached to merchandise containing electronically stored information. In retail, it is most commonly used for inventory decisions and control. While it has been slow to catch on because of cost factors, more retailers are now seeing the benefits of investing in RFID.

Untuckit has big plans. It plans to expand operation by 100 units within five years, with 50 planned by the end of 2018 and currently has 25 stores. The company recently launched a woman’s line, as well as adding children’s apparel and men’s pants to its offerings. Untuckit began in 2011 as an e-commerce shop.

Sato's Vision retail platform reveals which items are selling best, allowing for real-time inventory optimization based on shopper behavior. It suggests what sizes or styles can be fine-tuned because of low demand, allowing Untuckit to invest in more popular items or new offerings.

"Having visibility into shopper behavior is just one way we create a better experience in our physical stores. It allows us to meet expectations and retain customer loyalty," said Chris Riccobono, Untuckit founder and executive chairman, in a press release. "Moving from e-tail to multi-channel has its challenges, but we’ve found that our online experience helps us apply digital strategies to our physical stores and re-imagine retail in a way that other traditional retailers are not yet even considering."

Beacon-based overhead traffic counters from RetailNext allow the retailer to track traffic paths of shoppers and associates, as well as gather data on shopper-associate interactions. This is paired with the point-of-sale software.

And it all gets tied up in a neat bundle within the Internet of Things (IoT). "When people ask about examples of IoT in retail, I talk about this pilot," said Keith Sherry, chief operating officer of Sato Global Solutions, in a press release. "We have the ability to upgrade the physical store in a way that captures the same kind of data we get during online interactions. Retailers looking to compete in brick-and-mortar have more tools than ever to understand shopper behavior. The key is then applying these insights to align the customer experience with expectations across all channels."