What comes to mind when you hear “smart labels?” Do you think of QR Codes and RFID tags? If so, you’re on the right path!
Labeling has evolved over the years to give way to technologies that revolutionize how customers engage with businesses and how businesses track their products. With solutions like QR Code smart labels and RFID tags, enterprises are able to seamlessly bridge the gap between offline and online mediums, allowing for greater flexibility in customer engagement and business operations.
But, what are smart labels exactly? In this post, we look at the ins and outs of these technologies, exploring not only how they can elevate current operations but also how businesses of different sizes can incorporate them into their processes.
What are smart labels?
Smart labels are solutions that elevate traditional labeling by incorporating digital technologies. They go beyond providing surface-level data, as is the case with conventional labels, to open up a world of information to customers and businesses. Instead of only showing static information like product names and ingredients, they can carry dynamic and more interactive content like videos to enhance the customer experience.
Further, smart labels contain digital elements like QR Codes, RFID tags, and NFC tags. You’ve likely come across them when shopping or during typical business operations. They’re more prominent than ever as customers demand convenience, and businesses look for ways to streamline their processes.
Smart packaging and labeling can fall into two categories: consumer-facing and business-facing. Customers can engage directly with consumer-facing labels like those containing QR Codes. It only takes a scan from a mobile device to access everything from product information to interactive marketing content.
On the other hand, business-facing labels like RFID tags are more for internal business operations than direct customer contact. You’ll typically find enterprises using them to track inventory through the supply chain.
This isn’t to say the technologies are confined solely to these functions. Businesses are increasingly finding creative ways to use technology, so you’ll likely find them serving more than just these roles. For example, QR Codes on product packaging can go beyond their consumer-facing functionality to help with internal product quality control. You just need to link your code to a quality control checklist to make it easier for managers to access it when inspecting items.
The technology behind smart labels
The technology behind smart labels is what makes them stand out from traditional labels. Smart label technology provides a wide range of functionalities, including facilitating seamless customer interactions, inventory tracking, and product security. They include:
Radio-frequency identification (RFID)
RFID is a technology that uses radio waves to track and identify products. It comprises various components, including the RFID tag, which carries a product’s identification information; a reader, which decodes the tag’s data; and the antenna, an element in the RFID reader that receives signals from the RFID tag.
RFID technology is common in smart labels because it automates product tracking and data capture throughout the supply chain, which can enhance operational efficiency. It can also help with inventory control by showing real-time product locations, tracking inventory changes, and allowing you to find items quickly.
Popular brands like Walmart have already gotten on the RFID bandwagon for seamless inventory management, asset tracking, and supply chain visibility. The technology’s scanning distance capability (readers can scan RFID tags from up to 40 feet away) and ability to scan multiple tags simultaneously has solidified its presence in the consumer packaged goods sector.
Near-field communication (NFC)
If you’ve replaced your credit card payments with contactless mobile payments, you’ve already experienced NFC technology. It enables two-way communication between devices over short distances—the scanning distance is typically between 1 cm and 5 cm if using mobile phones.
The technology has immense value in labeling as it promotes consumer engagement by leading to a wide range of content, including product information, personalized offers, and product usage instructions. It can also help with product authentication by allowing vendors and customers to access unique identifiers and verify product origins and their journey through the supply chain.
The technology has also found its way into mobile payments, allowing consumers to complete purchases with a simple tap of their mobile phones. This facilitates speedy checkouts, ensuring customers have an overall high-quality shopping experience.
Quick response Codes (QR Codes)
QR Code technology is by far the most popular option because of its consumer-facing nature. People scan QR Codes daily for a number of reasons: to access menus at their favorite restaurant, to get product ingredient information when shopping, or to simply engage with their favorite brands through email or social media.
QR Codes have become indispensable in smart labeling because of their versatility. The two-dimensional codes can link to everything from landing pages showing product information to digital content like videos and interactive marketing campaigns, allowing businesses to not only enhance the customer experience but also promote their products and seamlessly engage with target audiences. Since QR Codes are scannable with almost all modern mobile devices, including iPhone and Android, they’re also easy to use for most customers.
These days, you can even use 2D Barcodes—a type of QR Code that carries a product’s Global Trade Item Number (GTIN) and can link to a website URL—to identify products during checkout and give customers easy access to necessary product information.
How smart labels can level up your operations and product management
Smart labels are a great way to elevate your operations and product management. Here’s how:
Better tracking and information accuracy
Manually tracking products as they move through facilities can be challenging and prone to human error. Smart labels make the process easier by providing real-time data on product location and status. This can help you locate products in large warehouses and retail spaces, allowing you to fulfill orders more quickly.
Further, when integrated into your asset tracking system, technologies like QR Codes and RFID tags provide a visual of products’ movements in the supply chain through scan data. You can track how long products remain in certain facilities or how fast they move along the supply chain, allowing you to identify bottlenecks that could lead to costly delays.
The best part is that you don’t need to create manual spreadsheets to do so, as scanning sends real-time updates to your tracking system. This is crucial in industries where precise tracking is critical, such as the CPG industry, hospitality industry, and retail industry.
Improved inventory management
If you constantly have to deal with abrupt stockouts, it may be time to invest in smart labels. They help with inventory management by providing accurate and up-to-date inventory information. This makes it easier for you to identify when to replenish your stock.
Smart labels also reduce inventory errors and increase operational efficiency by minimizing the need for human input. For example, if you use QR Codes for inventory tracking, there’s no need to count items manually. You only have to scan them as they enter and leave your facility to update your inventory database automatically. To do so, you’ll first need to integrate your inventory management software and barcode scanners or smartphones.
Better product security
Did you know that the annual value of counterfeited goods is between 1.7 trillion and 4.5 trillion USD?
While you can’t control whether counterfeiters copy your products, you can ensure customers know how to differentiate between genuine and fake ones by leveraging smart labels—they allow vendors and consumers to confirm products’ validity before purchases.
For example, if you incorporate QR Codes in CPG, relevant parties can scan them to access authentication codes or unique product identifiers. This helps you make sure customers only buy legitimate products, which can protect your reputation and build trust among your target audience.
You can also use tamper-proof NFC stickers or tags on high-value packages, like jewelry boxes, to prevent any form of tampering before they reach their intended destinations. If tampered with, these solutions become non-readable, thereby failing authentication checks. This can save customers from buying fake items and instill confidence in your brand.
Smart label security solutions are especially crucial in industries that face many security and counterfeiting issues, such as pharmaceuticals, cosmetics, and clothing.
Practical applications of smart labels by business size
Whether you’re a small, midsize, or large enterprise, smart labels can be valuable tools. Here’s how different businesses can use them effectively in different ways:
Small business
Small businesses can utilize smart labels to enhance product tracking and customer engagement on a limited budget. The key is to choose the right solutions. Some good options and their applications include:
- NFC tags to enroll customers in loyalty programs and allow them to earn rewards from their purchases.
- QR Codes printed on product packaging to help with inventory tracking.
- QR Codes on promotional materials to provide access to special offers like discounts.
Midmarket business
Midmarket businesses typically have bigger budgets and more needs than small businesses and, as such, can incorporate smart labels into their processes on a larger scale. They can integrate them into their existing systems to improve inventory management and operational efficiency. Some solutions worth considering include:
- RFID technology on products to track and find assets in facilities quickly.
- NFC smart stickers on high-value items to prevent tampering.
- QR Codes integrated into inventory management systems for real-time stock-level monitoring.
Enterprise business
Large enterprises can leverage smart labels for comprehensive supply chain visibility, advanced analytics, and enhanced product security. There are various ways to incorporate these technologies into their processes, including:
- Adding RFID tags to products to track their movements throughout the supply chain.
- Printing QR Codes on product labels for scan data to help gauge consumer engagement and product popularity in different locations.
- Using tamper-proof NFC stickers to ensure counterfeit products or items that someone has tampered with at any point in the supply chain fail authentication checks.
Use Bitly Codes to generate powerful insights for your business
Modern businesses can’t afford to miss out on smart labels. They not only make it easier for customers to access information and interact with your brand but also streamline business operations by enhancing inventory management.
With Bitly, you can easily create QR Codes to elevate your customer engagement efforts. Not only that, but you also get access to analytics, like the total number of scans and scans by location, helping you optimize operations by providing a visual of how products move along the supply chain or across facilities in different areas.
Get started with Bitly today to enhance your smart labeling efforts with high-quality QR Codes and actionable insights into your operational efficiency!