Industrial E-Commerce and Product Information Management, Part I
Industrial e-commerce requires well-managed, high-quality product information. But how can it be achieved in practice? I decided to explore this question in a three-part blog series. In this first part, I will introduce the most important terms and starting points for the topic.
Product Information Management (PIM) in short
Product information refers to information about a product that a company needs for marketing and sales (in contrast to technical product data, which is needed to manufacture a product). Product information is generated and maintained usually by the company’s product marketing team. Product information management (PIM) systems are especially designed to support the reception, enrichment and distribution of product information.
Why is product information management ever more important?
Customer experience and customer behavior
Purchase decision-makers in industrial companies are increasingly searching for information online and prepare their purchase decisions well before actually contacting the supplier. In addition, the ease of operational procurement is becoming ever more important, as the practices learned from business-to-consumer (B2C) world are spreading to business-to-business (B2B) commerce.
To be able to provide a consistent and well-branded, high-quality customer experience in all their sales and marketing channels, companies need an advanced product information management solution.
ERP and WMS call for efficient product information management
Increasing volumes combined with increasing variation of products creates pressure on enterprise resource planning (ERP) and warehouse management (WMS).
The requirement for efficient product information management is imposed by at least:
- Quick and efficient order-to-delivery process
- Expanding and increasingly complex product range / offering
- Requirements of electronic product marketing
- Ever stricter requirements of retailers and online store partners
- Multiple marketing channels
To tackle the challenges, product marketing will need something else than just Excel sheets, online directories and operative systems such as PDM, PLM and ERP.
Product information is expanding and becoming more complex
Companies want to introduce more and more alternatives to the market. To do so, they can either increase the number of product variants or offer a wider array of product configuration possibilities.
Product configuration makes product management more complicated, introducing optional product features and different options as well as rules and dependencies between these. Often the aim is to offer the customers the possibility to tailor their own product solution, yet with a limited number of options and from a limited, pre-defined product offering. This is referred to as mass customization. In both cases, either the product quantities (SKU = Stock Keeping Units) grow or product configurations become more complex.
In addition to a specific product that the customer is considering, companies also want to suggest and introduce the customers to other related products. These can be spare parts, optional or required add-ons and extensions, recommended accessories frequently purchased together with the main product, or alternative products. Alternative products can be slightly different product variants (cross-sell) or somewhat better products (up-sell).
Sometimes there is a need to bundle products to create structured entities, special offer packages or campaigns. Ever more often, companies want to build tailored offerings to meet the needs of specific customers or market segments. At the same time, however, there is also demand for ever more specific information on single products, including technical attributes that enable advanced product comparison, documentation, charts, pictures, videos and downloadable 3D models.
Furthermore, all the above-mentioned information should naturally be localized. That does not mean mechanical translations but instead tailoring the content to serve local needs, taking into account details such as technical units and currencies.
Companies need to update and renew their product offering ever more quickly and frequently. New products are introduced to the market quickly, and the information of existing products should also be kept up to date. Old products should be removed from the marketing and sales channels in a controlled way.
Sales and marketing channels are becoming more diverse
The number of different sales and marketing channels, especially digital channels, is increasing. A mere company website may not be enough. Product information should also be distributed in digital form to cooperation partners, retailers, online store platforms and their digital channels and platforms.
Traditional print media have not completely vanished either; people still want to read catalogues, brochures, flyers and data sheets, either printed on paper or as a PDF file. Here, the challenge is that the product information in these channels should also be consistent and up-to-date with the information in other channels.
How can companies best tackle these various challenges? Stay tuned for more on this topic in my next blog post!