Advertisement
07/01/2010

Beyond The Bar Code

QR codes enable retailers to deliver a wealth of information to the shelf edge via shoppers' mobile phones.

In 1973, the first Universal Product Codes (UPCs) were introduced. These were 14-digit codes on consumer packaged goods that included manufacturer and item identification information, which, at the time, set the retail industry on its ear. Retailers soon began installing laser scanners to read the codes, and computers to store and analyze the transaction data, and the revolution began in earnest.

Today, we take these codes for granted, and if you weren't involved in the industry way back then, it's hard to imagine how large an impact these codes had on the day-to-day operations of a typical supermarket. From packages, codes began appearing on the price labels at the shelf edge, facilitating the product- ordering process. An entire industry has since developed around UPCs, as well as standards on how they're assigned.

Fast forward to 1996: a Japanese company, Denso-Wave, Inc., develops a new type of code that uses a dense series of digital "blocks" to form a square that's read in two dimensions — height and width — as opposed to the well-known one-dimensional UPC. Developed to track auto parts, these so-named "QR codes" (QR for "quick response") have become nearly ubiquitous in Japan. Today, they're being used with increasing frequency in the United States, starting with magazine ads and progressing to various other media, including signs and product packages.

QR codes, also known as 2D bar codes, are essentially a link to some other content. As smart phones begin to overtake feature phones in penetration, the abilities of what are essentially pocket-sized computers are being exploited, and QR codes are a great way to use the connectivity these smart phones offer.

To use the codes, a consumer just has to install a QR code reader application, many of which are custom developed for iPhones and BlackBerrys. Once the QR code is scanned, the user is directed to a URL via the phone's Internet connection. It's simple, but the concept of bringing the Internet with all of its vast resources to the palm of one's hand does provide food for thought.

The first thought of observers tends to be how these codes could be used on product packaging, which is interesting, but they also provide opportunities for retailers. For example, you can post QR codes at the shelf edge and link them to a retailer loyalty program. Imagine three shoppers all scanning the same code and being directed to three different places, or given three different offers, all based on shopping history and behavior. Imagine being able to track shopper engagement at the shelf edge for the ultimate in ROI measurability.

While it may seem complicated, it's quite achievable, and not expensive to deploy, as there's no hardware involved.

However, for QR codes to generate the critical mass of users to adopt industry-wide, there are two caveats:

  • QR codes alone won't bring this concept to its fullest conclusion. That will require a branded mobile application that shoppers download and want to use. The branded app is relatively simple, but getting shoppers to want to use it brings us to the next caveat
  • Relevant, engaging content will be required to make this endeavor successful. That has to be driven by providing value to the shopper — real, compelling value that will encourage her to engage this way each time she comes to the store

Connectivity and the ability to search for information about literally any topic have led to the Internet's designation as the "database of intentions." It also means that shoppers are better informed than ever, not to mention more cynical than ever. But for retailers willing to make the commitment to connect with their increasingly mobile shoppers now, the rewards will be well worth the investment.

Jeff Weidauer is VP of marketing for Little Rock, Ark.-based Vestcom International, Inc., a provider of technological retail solutions. He can be reached at [email protected], or by visiting www.vestcom.com.