Factors Affecting RFID Adoption: An Exploratory Study

Factors Affecting RFID Adoption: An Exploratory Study

Mohammad Alamgir Hossain (School of Business, North South University, Dhaka, Bangladesh) and Mohammed Quaddus (School of Marketing, Curtin University, Perth, Australia)
DOI: 10.4018/ijisscm.2014070102
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Abstract

In marketing, a customer purchases a product while a consumer uses the product; which means that an adopter of an innovation behaves like a consumer of a new product. But surprisingly no initiative has been made to relate/integrate an adopter with a consumer. This article has done this. Technological, organizational, environmental factors as well as “expectations” from using the technology are important for the acceptance and continued use of a technological innovation. This paper integrates the effect of innovation characteristics along with the expectation on RFID adoption, in the context of Australian livestock industry. To do this, this study first presents a theoretical analysis then presents the outcomes from eight interviews which were conducted among livestock farms in Australia. Finally, it proposes a research framework while proposing eleven propositions related to RFID adoption. Contribution-wise, policy makers may compare their experience with this study, evaluate the past, and find the future direction.
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1. Introduction

Radio Frequency Identification (RFID) technology has been being used in numerous applications around the world, from animal identification to weapon tracking to fault monitoring in train tracks (Moon & Ngai, 2008). Many industries adopted this technology particularly to achieve information efficiencies. Its adoption is sometimes mandatory whereas for many applications it is voluntary; though a pure voluntary environment is hard to find. The absolute pressure from Wal-Mart to its suppliers is the revolutionary example of the mandatory RFID-adoption. As the consequence, the supply chain partners of Wal-Mart first adopted RFID and then adjusted their perceptions and usage decisions in later stages. Similarly, the International Civil Aviation Organization (ICAO) has mandated for every traveler to have an RFID-enabled electronic passport (e-Passport) by April 2014.1 The most common application of RFID is the access card issued by organizations to employees which is the only way to access into the premises and avail the (customized) resources. In this instance, employees have no choice at all on RFID adoption or RFID-use but to accept it regardless of their perceptions.

As a voluntary choice, many countries issued RFID cards as the payment method for public transport commuters which can also be used in vending machines, toll payment, and even as a debit card in selected stores. It is an example of purely voluntary adoption through some sorts of incentives and exclusive benefits. However, to offer an integrated system for citizens, many countries introduced RFID-enabled compulsory national identity (ID) cards which can voluntarily be used as a means of availing other facilities including toll payment, driver’s license, and voter ID. This is somewhat a mixed environment consisting initial mandatory adoption and voluntary diffusion in a later stage. Similarly, the initial adoption of RFID-based animal identification and management system in Australia was mandatory (for cattle) and was left voluntary for other animals’. Therefore, the cattle farmers have no choice but to adopt RFID for their cattle identification whereas they can choose whether to adopt RFID to identify other animals (e.g., sheep, pig etc.) and/or to use RFID for automatic farm management operations.

In marketing, a customer purchase a product while a consumer uses the product. In behavioral science, the adopting-body introduces an innovation and the adopters practically use the innovation. Sometimes a customer can be a consumer too as an adopter may introduce an innovation him/herself. This means that, the adopting-body of an innovation (introducer) may behave like a customer of a new product and an adopter may behave like a consumer (user). Throughout this paper thus, thereafter, user and adopter will be used in an interchangeable meaning.

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