EAS Decisions

Store Intelligence. Retail Excellence

charting a path for electronic article surveillance:AM, RF-EAS, and RFID


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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 and to deliver the most protection from tight staff and budget allocations, retail executives are reviewing alternative technologies, especially advances in Electronic Article Surveillance. And as more of them adopt Radio-Frequency Identification technologies to help speed up supply chains and manage store inventory, retailers are also looking for ways to adapt RFID technologies to improve inventory visibility associated with shrink. 4

1 Joshua Bamfield. The Global Retail Threat Barometer 2011. (Nottinghamshire, UK: Centre for Retail Research. October, 2011)2 Richard Hollinger, Ph.D. and Amanda Adams, M.A. 2010 National Retail Security Survey. (Gainesville, FL: University of Florida. 2011).3 Tyco Retail Solutions Organized Retail Crime White 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”


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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.) http://www.rfidjournal.com/article/view/1338.


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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..

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.

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.)

Very Low (VLF)

Low (LF)

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High (HF)

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10 kHz 100 kHz 1MHz 10 MHz 100 MHz 1 GHz

Naval Communication AM Radio Mobile PhonesTelevision

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Radio-FrequencyEAS (RF-EAS)

Radio-FrequencyIdentification (RFID)

Frequency58 kHz ± 1% 8.2 MHz ± 12% 904 MHz ± 0.2%(North

America)866.5 MHz ± 0.2% (Europe)

Coupling Induction Induction Radiation

Information

Tag detected Tag detected SKU-level information

AM RF-EAS RFID

! ! 1010101010101010101010

101010101


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Low electromagnetic frequencies, like the low-frequency acoustic signals from a foghorn, offer better range, easily penetrate moisture and other barriers, travel in all directions from small, simple sources, can be detected by simple receivers, and are difficult 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 robust detection of tags in difficult environments or in the presence of countermeasures, so long as the information “payload” is modest. Higher frequencies used for RF-EAS offer lower penetration over a shorter range, require larger antennas, are more susceptible to moisture and other barriers, making them easier to block—while carrying no addi-tional information. UHF frequencies used for RFID operate directionally over “line of sight” pathways, and are susceptible to blocking or detuning. In addition, they reflect or “bounce” when they strike objects that impede their transmission—metal surfaces, for example. But UHF frequencies can carry much more information, so when 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 their performance in real-world retail environments. AM and RF-EAS systems are inductively coupled, that is, the tags resonate when placed in an electromagnetic field of the right frequency. But RFID signals are radiated, like radio or TV signals—allowing signals to travel further, leaving systems open to reflected signals from tags far from the exit.

Frequency bands and errors

Frequency determines range, penetration, and similar capabilities, but error rates also depend on the frequency range, or band, that a controller accepts. A wider band not only offers greater sensitivity to legitimate signals from tags, but also accepts more spurious 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 (and two types of correct outcome), as shown in Figure 2.

Figure 2: Four possible results from an EAS scan, two correct outcomes and two types of error.

Tag Present No Tag Present

Tag Detected “Hit” outcomeTagged merchandise is leaving the store—Security alerted

“False Alarm” errorNuisance alarms annoy shop-pers; waste staff time

Tag Not Detected “Miss” errorUndetected thefts cut profit and encourage thieves

“Correct Rejection” outcomeNormal shopper departure—no action required


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AM technologies’ narrow (± 1%) frequency band offers better immunity from the spurious signals common to store environments, because electrical noise outside the band can’t be misinterpreted as the presence of an AM tag, and few in-store sources produce 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, including electric 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 source of false alarms unique to RF-EAS is the “Lazarus Effect.” RF-EAS tags are disabled by short-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 they annoy shoppers and waste staff time. But silent “miss” errors actually pose much greater risks to stores. Misses represent direct losses from merchandise theft, and also send unmistakable signals to thieves that a store is an easy target. In inventory management RFID applications, misses have low impact: conditions are cooperative and tightly controlled, and reattempts almost always are possible. But range limits for all RF technologies, and the complete-read requirement for RFID, raise miss probabilities to costly levels. And in retail EAS applications, misses undermine the function and purpose of Loss Prevention.

EAS performance in retail environments

We can now apply our understanding of the physics of EAS technologies to the challenges presented by retail environments, products, and dishonest adversaries, and show how actual EAS systems perform in the difficult real world.


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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 that offers significantly longer range and is compatible with physical store infrastructures. Therefore AM systems can cover wide entrances and are resistant to shielding from metal doors and building materials, which means that antennas may be embedded in store 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 sacrificing valuable front-of-store floor space to establish a “clear zone” in which RF-EAS systems can work, or an uninvitingly narrow “tunnel” through which shoppers must enter and leave. Not surprisingly, stores work hard and spend much to avoid such layouts, for example by spacing multiple pedestals across an entrance to overcome RF-EAS range limitations.

RFID also faces challenges at the front end, but for different reasons. Reflected UHF signals can travel a long way, so exit-based RFID systems can read tags on merchandise located a significant and unpredictable distance inside the store. Protection against false RFID reads usually involves establishing a merchandise-free clear zone at the front of 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 clear zone area difficult to determine.

“Nuisance” reads of tags on merchandise displayed near store exits may occur with all three technologies. But at high frequencies used by RF-EAS and RFID, reflections by shoppers and carts are much more significant, and may require establishing a merchandise-free, unprofitable “dead zone” around RF pedestals to prevent false reads.

Metal shopping carts also deserve mention as a disabling environmental challenge for high-frequency RF-EAS and RFID systems. Shielding by and interference from metal cages is well known as a way to block radio transmission and reception—a fact not lost on thieves. Worse, contact with metal directly alters RF antenna characteristics, so clever 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 tags and labels perform very differently when applied to merchandise. Acousto-magnetic frequencies are indifferent to blocking and interference from these sources, but RF and RFID technologies struggle to read tags placed in or near metal foil packaging, metal products, and products with significant water content, including liquor, meat, cosmetics, and other valuable items.


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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 and placements can even be optimized for specific merchandise—and programs such as source tagging certification ensure that EAS tags perform properly when merchandise arrives in retail stores.

Countermeasures by thievesEnvironmental and product challenges to EAS technologies are significant, but they change slowly, as technologies improve. The third type of challenge—countermea-sures by increasingly organized and sophisticated criminals—adapts rapidly to LP technologies and strategies, to maximize rewards to thieves and minimize their risks.

Vulnerability to countermeasures is a critical differentiator among EAS technologies in real-world retail environments. Studies of the feasibility of adapting RFID technology 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.

ShieldingShielding 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 DeactivationRemoving 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. AM hard tags are manufactured from tough plastic, with detachment mechanisms designed for maximum tamper resistance. Embedding labels in product packaging

“ Vulnerability to countermeasures is a critical differentiator among EAS technologies in real-world retail environments.”

6 Bill C. Hardgrave. RFID as EAS: Feasibility Assessment. (Fayetteville, AR: University of Arkansas. December 19, 2007).


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material by manufacturers or third-party Value-Added Resellers (VARs) offers another way to complicate thieves’ attempts to defeat them. Because it works with virtually any packaging material or process, AM technology is well suited to source tagging applications. And AM labels, whether applied or sewn in, are smaller, tougher, easier to embed, and harder to defeat than alternatives.

EAS performance of RF-EAS tags and labels, and of RFID tags, depends on their antenna 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 Tyco Retail Solutions are applying decades of experience with AM defeat resistance to develop creative RFID solutions for packaged goods and apparel.

Out of the lab; into the store The use cases presented above may seem at odds with laboratory studies, which may show AM, RF-EAS and RFID technologies performing comparably in EAS roles. But this is precisely because of the differences between the laboratory, where variability is strictly controlled to assure that results are consistent and reproducible, and the retail environment, where variability is the norm. Consider what happens to RFID in EAS ap-plications when confronted with even the most modest challenges.


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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 tagged3. Maximize the value of current technology investments

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81.67%

AMRFIDRF-EAS

One Tagged ItemPerformance by Lane

94.44%100.00% 100.00% 100.00% 99.44%

Center Side Center Side Center Side

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One Tagged Shirt, WornPerformance by System

56.67%63.33%

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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

7 Bill C. Hardgrave. RFID as EAS: Feasibility Assessment. (Fayetteville, AR: University of Arkansas. December 19, 2007).


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Higher-frequency technologies are appropriate for less challenging environments and cooperative applications where tags are presented for reading. For example, inventory visibility in apparel is an excellent fit for UHF RFID technology, and is already delivering huge benefits for retailers who have adopted. But harsh environments and non-coop-erative EAS applications present significant challenges for these technologies. Metal sliding doors, packaged goods like health and beauty care, and professional shoplifting countermeasures like foil lined bags create very adverse conditions for RF-EAS and RFID. When these challenges are present, retailers should consider AM or AM/RFID dual solutions.

A technology partner with experience across the frequency spectrum is an invaluable asset 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 conditions

Tyco offers retailers the flexibility to choose the technology path that works best for them, whether this is a combination of AM and RFID or RFID as EAS. Regardless of your preferences, Tyco has the knowledge, commitment and resources to optimize your technologies for security and store performance.


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Leverage our strength and experience

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’s top 200 retailers. Customers range from single-store boutiques to global retail enterprises. Operating in more than 70 countries worldwide, Tyco Retail Solutions provides retailers with real-time visibility to their inventory and assets to improve operations, optimize profitability and create memorable shopper experiences. The Tyco Retail Solutions portfolio is sold directly and through authorized business partners worldwide. For more information, please visit www.tycoretailsolutions.com.

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Business

EAS Decisions