LAS VEGAS (BRAIN) — Gray marketing and rampant online discounting are twin evils plaguing a host of brands. But Selle Italia is beefing up its fight to maintain control over its products and pricing.
Next month the Italian company will begin to insert RFID chips into its aftermarket saddles during regular production runs. RFID (Radio Frequency Identification) chips will help the company spot products that have been diverted into unauthorized sales channels, said Dan Mckenna, commercial director of Vittoria Industries North America. Vittoria distributes Selle Italia in the U.S. market.
The chips will be embedded within the saddle's foam structure and then covered, as normal, with a leather wrap or other material. As Mckenna pointed out at Interbike this week, to dig out the chip would destroy the saddle.
"This technology is going to let us monitor our saddles worldwide — especially those that end up in the gray market and online," he said. "We can purchase a saddle, get the chip, and we can tell who we sold it to and when it was sent from the factory," he said.
Using RFID technology will be a significant benefit for retailers selling saddles in the aftermarket since the company can quickly shut down unauthorized distribution. "It really protects the retailer and pricing," Mckenna said.
One way to think about RFID chips is they can follow a saddle throughout its lifespan. RFID chips will not be inserted in saddles spec'd by OEMs. "It's a global market now, and products are sold anywhere at any time. This give us some control over our products," Mckenna added.
Mckenna said he didn't know what it would cost the saddle maker for the chips, but that integrating the chip insertion at production will be part of the normal manufacturing process.
