2014 Smith Abstract Research

Research on radio frequency identification (RFID) applications has grown significantly as the technology can potentially improve organizational performance and enable new business models. However, actual implementation has been slow to transition from back office operations to front office applications, as many customers have demonstrated concern about the invasion of personal privacy and/or the improper utilization of information. This research aims to explore the customer acceptance issue by examining the factors that potentially enable and inhibit the utilization of RFID-enabled systems. To accomplish this goal, we conducted three studies using information from over 800 consumers, while employing three different methodologies. Results indicate potential usage of RFID systems can be positively impacted by the perceived usefulness (PU) of the technology, while privacy concerns have a negative impact. In particular, the positive impact of PU appears to weigh more heavily on consumers than the negative impact of privacy concerns. Additionally, there are differences in privacy concerns, technology attitudes, and purchase intentions based on how the system is labeled, along with the nature of the privacy statement. Accordingly, firms need to be specific in their privacy statements as this practice yields higher customer purchase intentions. From a managerial perspective, it is imperative that companies present a clear message to customers as to how RFID can benefit them while also being clear and concise about how any information associated with the technology will be used in an ethical manner.