Most of our readers will meet the Digital Product Passport as a deadline rather than an opportunity, which is exactly the framing Nanna Ingemann Dalsgaard thinks will cost them money. As VP of Strategic Intelligence at SML Group she spends her time on the gap between what the regulation requires and what the infrastructure could do, and she is unusually willing to say where the industry is getting ahead of its evidence. We put six questions to her on what item-level RFID does and does not solve for DPP, where the margin actually sits, who owns the accuracy of a passport when a supplier gets it wrong, and whether consumers will ever care. Her answers are published in full and unedited.

Nanna Ingemann Dalsgaard

Vice President, Strategic Intelligence, at SML Group. SML supplies RFID tags, labels, brand identification and Digital Product Passport carriers to retailers and brand owners worldwide, working across RFID, NFC, QR and digital product identity.

The DPP conversation has moved from “where is this product” to “what is it made of, how was it used, and where does it go next”. For a brand that already runs item-level RFID, how much of the DPP problem is already solved, and how much is genuinely new work?

The first thing to be clear about is that RFID and Digital Product Passports are not the same thing. They solve different problems, but they can complement each other extremely well.

RFID has primarily been deployed to give brands visibility of physical products across factories, distribution centres and stores, supporting inventory accuracy, operational efficiency and increasingly traceability. A DPP has a different purpose: it connects a product to a much richer set of information about what it is, what it is made from, how it should be used, repaired or recycled, and potentially what happens to it throughout its lifecycle.

So a brand with mature item-level RFID has not already “solved DPP”, but it has solved an important part of the foundation, which is creating and managing digital identities for physical products at enormous scale.

The genuinely new work is largely around the data behind that identity, bringing together information that today may sit across PLM, ERP, suppliers, sustainability systems and other sources; establishing governance and access rights; and making that information available in the interoperable structure required by DPP.

We, at SML, see RFID and DPP as complementary rather than competing technologies. The opportunity is to build on the item-level identification infrastructure many brands already have and extend it into a broader connected-product architecture.

That is where it becomes more interesting than compliance. Once a trusted digital identity can connect a physical product with reliable information throughout its lifecycle, the same foundation can support supply chain efficiency, traceability, circularity, authentication, resale and new consumer experiences. RFID gives many brands a significant head start. DPP expands what that digital identity can ultimately do.

The Thursday DPP track opens with a session titled “From Mandate to Margin”, which is a bolder claim than most DPP talk. Where is the margin actually, and is there a brand you can point to that has found it rather than just complied?

I think the phrase “from mandate to margin” is important, because the margin does not come from the passport itself. It comes from what you build on top of the product identity and the data behind it.

If DPP is treated purely as a regulatory project, it will primarily be a cost of compliance. But once that digital connection to the product is in place, it opens up several value pools. A connected product can become a direct post-purchase touchpoint with the consumer. It can enable services such as repair, take-back and resale, support authentication and increase confidence in secondary markets. And over time, the data generated across those interactions can help brands understand how products actually move through their lifecycle.

We are already seeing early examples. Green Cotton Group in Denmark has connected Digital Product Passports with its RE-LOVED recommerce model, where published results show that 50% of resale buyers were new customers and 86% of orders combine new and second-hand products.

Other projects involving brands are also exploring how DPP infrastructure can make resale more efficient and potentially allow brands to participate economically in a product’s second and third life. However, I think we need to be careful not to overstate where the industry is today. We have early signals of emerging business models and commercial use cases; we do not yet have years of evidence showing a universal “DPP margin”.

At SML, we encourage brands to think about how compliance establishes the requirement, but it should not define the ambition. If you are going to create the product identity and data infrastructure anyway, design it so it can support future value creation as well. The real shift is from thinking about the product relationship ending at checkout to potentially creating value throughout the product’s lifecycle.

Most of our readers will meet DPP first as a compliance deadline rather than an opportunity. What is the most expensive mistake a brand can make in the next eighteen months while treating it that way?

I think the most expensive mistake would be to build DPP as a standalone compliance project that you later have to rebuild as business infrastructure.

I completely understand why brands initially say, “just make me compliant”. DPP is complex. It touches data that may sit across PLM, ERP, suppliers, sustainability systems and other parts of the organisation, and the regulatory requirements are still developing. That is why I think the focus right now should be on understanding what you already have before deciding exactly what you need to build.

Start with a focused pilot. Understand where your data sits, what is missing, how reliable it is, how products are identified today and how the different systems connect. That gives you a much clearer picture of your starting point and what will actually be required.

This is also where industry experienced solution providers can help reduce complexity. At SML, for example, we approach DPP across the physical and digital layers, from product identification and data carriers through to the digital platform and the connections into a brand’s existing ecosystem.

While you are doing the work, think beyond the immediate compliance requirement. The same product identity and data infrastructure may eventually support richer consumer engagement, authentication, repair and resale, circular services and better lifecycle insight.

So my advice would be to not wait for every regulatory detail to be final. Start now by understanding your data, what you have, where it sits, what is missing and how reliable it is. You do not need all the answers yet, but you need to understand your starting point. The expensive mistake is not starting small. It is starting with something you know you most likely will have to replace.

RFID gives you a serialised identity at item level, which looks like the obvious carrier for a DPP. What are the honest limitations? Where would you tell a brand that a QR code or something else is the better answer?

RFID is extremely powerful for creating a serialised identity and capturing products at scale across factories, distribution centres and stores. The limitation today is at the consumer interface. RFID, which is widely used for item-level identification in apparel, cannot generally be read by today’s end consumers’ smartphones. So while RFID can provide the identity and support the product throughout the supply chain, consumers currently need another way to access the DPP.

That is where QR codes have a very obvious advantage. They are inexpensive, familiar to consumers and can be accessed directly with a smartphone camera. If the primary requirement is simply to give a consumer easy access to a Digital Product Passport, QR may therefore be the most practical answer to begin with.

NFC provides another option. It offers a tap-based consumer experience and is supported by modern smartphones, but it comes with different cost and implementation considerations. For many brands, the answer may ultimately be a combination. RAIN RFID can support high-volume identification and operational use cases throughout the supply chain, while QR or NFC provides an accessible consumer interface to the same underlying digital identity and information.

At SML we work across RFID, NFC, QR and digital product identity, so the objective should not be to push a particular carrier. It should be to design the identification architecture that makes sense for the product and the use cases. The carrier is the doorway. The real value sits in the identity, the data and the services you connect behind it.

A DPP is only as good as the data behind it, and apparel supply chains are not famous for clean data. Who in the chain actually owns the accuracy of a product passport, and what happens when a supplier gets it wrong?

Ultimately, the regulatory responsibility sits with the relevant economic operator, it cannot simply be outsourced to a supplier or technology provider. But the data itself will inevitably come from many different actors across the supply chain.

A mill may provide information about materials, a manufacturer about production, and certification or testing data may come from another party altogether. So data accuracy is not just about collecting information. You need to know where it came from, who provided it and ideally what evidence sits behind it. Suppliers will get things wrong, data will change, certificates will expire and information will sometimes be incomplete. That means brands need processes for validation, correction and governance rather than assuming that everything entering the passport is automatically correct.

For me, this is one of the biggest lessons for brands starting their DPP journey is, do not wait for perfect data before you start. Use the time you have now to understand where the gaps are, establish ownership and start improving data quality, rather than waiting until the requirements become mandatory. Clean data is something you build, not something you are handed.

“Clean data is something you build, not something you are handed.”

Five years out, does the DPP become invisible infrastructure that nobody talks about, or a thing consumers genuinely interact with? Your honest view, not the optimistic one.

Honestly, I think it will be both, but most consumers will probably never talk about a “Digital Product Passport”.

What consumers may interact with is what brands and retailers choose to build around the infrastructure. If the experience stops at presenting the information required for compliance, I think consumer engagement will be relatively limited. People may access it when they need specific information, but there is not necessarily a reason to keep coming back.

The opportunity is that the digital connection to the product does not have to stop there. The experience can evolve throughout the life of the product. A consumer scanning a sweater when they buy it in May could see one experience, while scanning the same sweater in November could provide something different, a new service, a campaign, a styling suggestion, a loyalty benefit or another reason to engage with the brand. That is where I think it becomes really interesting. A physical product can become an ongoing touchpoint between a brand and its customer rather than the relationship largely ending at the point of sale.

DPP is in my view part of that broader connected-product opportunity. Regulation may drive the infrastructure and accelerate adoption, but brands still have to create a reason for consumers to engage with it. So five years from now, I do not think consumers will care about DPP itself. They will care about what it allows them to do.

This article first appeared on RFID News (rfidnews.co.uk), the independent news site for RFID and NFC. Republication and AI use are welcome with RFID News credited as the source and a link to the original.