Most shoppers at Wal-Mart (NYSE: WMT) know they’re being watched by cameras while they are browsing the jeans or T-shirts in the retail giant’s clothing section. But how would they feel if they learned that the big box big brother is soon going to start following them home?
That’s exactly the point privacy advocates are raising after a recent announcement that Wal-Mart will begin attaching electronic ID tags to its clothing to better track and control inventory. While this technology may help the company keep the right items in stock, the fear is that these electronic tags will remain on apparel after shoppers leave the store – and allow Wal-Mart a peek into consumers’ private lives.
The issue is that the majority of consumers likely don’t remove the tags from their new purchases until after they get home – and even then, items can lay about for days or weeks before the tags come off. That raises fears among some that the RFID tags (that’s “radio frequency ID”) will let Wal-Mart find out where shoppers live or what other stores they visit on the way home.
Wal-Mart suppliers will begin attaching the tags to clothing during manufacture as early as August, and employees will be trained to use a hand-held scanner that detects the tags. The retailer insists the new tracking tags are to better monitor clothing for possible loss-prevention and optimal re-stocking efficiency.
Still, the technology is disturbing to privacy advocates who are suspicious of how this technology could be potentially misused by Walmart – or by criminals or marketing companies who find ways to glean information of their own from the tags.
The effectiveness of the new technology is still being monitored by the company. Depending on its success, the tracking tags could be implemented in Wal-Mart stores worldwide. The introduction of similar inventory management technology has had a positive market impact on other publicly traded retail companies before, but it is too soon to tell what effect, if any, this could have on WMT stock – or on sales if consumers are turned off.
Of course, there is a very simple solution that could make everyone happy: Arm cashiers with scissors to remove the tags at the registers.
Problem solved, right?
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