PIM 360° english

Increases Margins by 44 %, with a conversion rate of 35 %

2011-08-18T03:29:00.000-07:00

Research points out that the return on investment (ROI) from product information in multichannel commerce:

The results of the international study shows a return on investment (ROI) from an Enterprise Product Information Management (PIM) solution is possible within the framework of a multichannel commerce strategy. Over 400 retailers and manufacturers from 14 countries participated in the extensive study by Heiler Software.

The study at www.pimroi.com delivered measurable results and demonstrated the benchmarks for how international retailers and manufacturers can optimize their business model revenue figures and costs with Product Information Management (PIM).

The enormous growth rate of e-commerce also means an increase in the demand for data quality in the web shop. When looking at the survey results it can be clearly seen that the conversion rate, margins and acquisition of new customers, are seen as the most important factors.

The increase of the conversion rate without PIM was at 27 %,with PIM at 62 % (+ 35%) and likewise the increase in profit margin without PIM was at 36 % and with PIM at 80 % (+ 44 %) was seen as a significant PIM benefit. However the acquisition of customers at 69 % with PIM was estimated as being 30 % higher than the performance without PIM.

75% More Speed for e-commerce

The length of time from changing a product at the e-commerce site is an important key performance indicator for the web shop. Here the use of PIM reduces the period of time significantly from an average of four hours to one hour.

Success factor: Supplier Integration in Retail

Retailers need to integrate supplier data much more often each year. The study confirms that the retailers using PIM were considerably faster (7 through 14 days) in comparison to 21 through 28 days.

www.pimroi.com

Customer Visit at Kramp:E-Commerce Strategy is exemplary

2011-03-11T00:05:00.000-08:00

Tines, hand tools and hydraulic motors are the order of the day at Kramp. Spare parts for agricultural machines – that doesn’t sound very innovative... But Kramp, based in Holland, is Europe’s largest wholesaler of accessories and spare parts for motorized equipment, agricultural and construction machines.

Meeting Eddie Perdok, CEO at Kramp was inspiring on a personal level. But also the company’s business model and e-commerce strategy is exemplary. 340 million Euro in sales and 10,000 orders per day will raise strongly, this is for sure. Kramp is one of the hidden champions in my eyes.

„We believe in the future and the power of e-commerce”, said CEO Eddie Perdok. Kramp stocks over 400,000 items from 2,000 suppliers. The company wants to extend the deliverable virtual stock to 1 million items and is using the long tail strategy to implement this.

“We want to bring customer opinion and supplier knowledge together” (Quote: Eddie Perdok). Online customer evaluation combined with the knowledge of the manufacturer puts us in the position of being able to optimally control stock. In e-commerce, manufacturers, retailers and customers are getting closer in the product information supply chain. Kramp follows the idea of efficient consumer response driven by the search for perfect product data as the prerequisite.

The principle of cooperation and collaboration will also determine future business in the aftermarket. Potential exists wherever complementary products are sold online. Kramp uses the IBM WebSphere Commerce as its e-commerce system.

Perfect product information, based on supplier knowledge and customer feedback, has deep impact on their business model and the multichannel sales strategy.

Customer decisions in eCommercerequire perfect data

2011-03-10T07:04:00.000-08:00

On the internet, the data is the product. Unlike in reality, where the customer can touch and examine products in order to compare them, in the online virtual world he must depend 100% on the product data (including images or videos). The basis of his decision is the product data available. No data - no comparison - no decision. No purchase. End of story. One more visit that adds to the unhappy balance of 97% non-purchasers. Preparing the data correctly and presenting it in the right structure is, then, a foundation for high conversion rates.

The ROI of good product information is probably much higher in reality than if we “just” take into account the savings made on the processing and handling of investment data. In online shops product data plays an important
role in the purchase decision – and the positive result of this decision is ultimately one which we can measure as
conversion rates. No figure correlates higher with the marginal income of an online shop – not to mention the
satisfaction of eliciting the simplest of decisions from the customer.

Learn more in chapter 5 of the best of breed whitepaper series PIM 360. I would especially like to thank Mr. André Morys, CEO of Web Arts.

PIM Trends 2011: E-commerce & multi-channel strategies are the drivers of product quality in commerce

2011-01-19T03:36:00.000-08:00

The search for the right strategy for multi-channel commerce is the strongest driver of data quality in commerce. As a leading supplier of master data management (MDM) and multi-channel solutions, therefore we have put together seven important trends that will characterize product data management for the multi-channel environment for 2011.

1. Greater collaboration in the information supply chain:
Precise descriptions help sell products. In commerce, the collecting and organizing of product details is therefore of great importance. Manufacturers are in possession of the best data. The challenge is to retrieve their data in the best possible, and most importantly, simple manner. To ensure the most efficient operation possible, the motto has to be "100 % supplier self-service". Using a supplier portal, suppliers can perform this step simply and directly, and in addition they will also gain a better insight into the sales channels of their products through commerce.

2. Conversion rate and return rate as key factors:
Merchants who wish to avoid high return rates because of product descriptions in their catalog and/or their eCommerce site that are not matching the supplied items, must improve data quality first and foremost. Conversion rates also determines success in eCommerce. On the Internet, the displayed data represents the product. Customers have to rely on the provided text, images and videos when making their purchasing decision. The importance of product data in eCommerce is illustrated by the Heiler study of the topic available at heiler.com/research.

3. PIM enables Faceted Search:
Browsing by property, characteristic or value – these are the filter criteria, which influence todays eCommerce sites’ navigation. The theme of the faceted search is not new, but has recently established itself as an important factor for fast and successful search. But only perfect product data with all attributes make the "faceted search" function properly and the eCommerce world go round.

4. Quality needs rules:
Ensuring data quality is easier said than done. Besides care and intensive maintenance, there is a need for rules. It is in its Data Governance that an organization defines guidelines as to how and by whom product master data is to be handled. Lawgivers are also making increasing demands regarding compliance in several industries.

5. New jobs and processes in commerce:
In their search for the right multi-channel strategy, companies are increasingly considering the creation of a new job, that of the "Multi-Channel Manager". Universities, such as the University of Applied Science, Wedel in Hamburg, are even creating dedicated courses. On the one hand, the Multi-Channel Manager has to stand back from the channels in order to organize the data in a neutral manner, but on the other hand he or she must think along channel-specific lines, because data preparation and maintenance take place increasingly within the context of the marketing and distribution channel, as well as of the medium. It is precisely from these channels that the Multi-Channel Manager will create a central set and view of all data.

6. Multi-shop management:
Internationalization and a stronger focus on individual target groups, this is the dichotomy that major distributors want to bridge. The right eCommerce strategy will therefore involve the creation of individual brands and eCommerce sites to suit the different countries and target groups combined with maintenance of a central platform that can supply all the international shop systems.

7. Customer feedback acting as a correcting variable for product range management:
Bringing customer opinions and supplier knowledge together and combining customer evaluation from the Internet with the manufacturers' knowledge will enable merchants to control their product ranges to the best effect. The idea of user generated content turns to user generated products and assortments.

To summarize, the following will apply for 2011 and beyond: Manufacturers, merchants and customers will come even closer together in eCommerce. The concept of "efficient customer response" is becoming a reality, driven by the search for perfect product data as the basis of multi-channel commerce.

E-Procurement Trends 2011 Procurement Learning from B2C Trade

2011-01-12T23:38:00.000-08:00

Procurement is becoming more and more of a value driver in international companies. Heiler Software, a leading provider of catalog management and e-procurement solutions, has compiled five trends that will be shaping electronic procurement starting in 2011. It is apparent that paradigms in the B2C business are increasingly influencing company’s procurement processes.

1. More Transparency

Purchasing managers need maximal transparency when it comes to supplier prices, employees' ordering habits and the composition of suppliers' product lines. Modern dashboard technologies are now making comprehensive drill down analysis and global spend maps possible. This allows purchasing managers to optimally prepare for negotiations with suppliers. Catalog comparisons, product line analysis, price simulations and other analysis bring more transparency into the entire sphere of procuring indirect goods and services.

2. Index Search and Cost Reduction for Content Management
An index search of all internal and external catalogs helps reduce content management costs and furthermore, allows for better search results. Each supplier is integrated initially and then regularly delivers a search index, just like with a price search engine on the Internet. An index search is also capable of searching through all associated catalogs, both internal and external. This allows for a reliable search performance and standard user interface. The external products can be placed directly into the shopping cart if desired. "Rogue prices" can be identified by comparing prices with products that have already been ordered. Alternative products from other providers can also be found and compared.

3. Social Commerce Model
The internal product search engine in e-procurement is now on par with the methods known from B2C eCommerce. Each employee contributes his own private search expectations to the company’s internal procurement process: Facet searches, features and product suggestions are becoming increasingly important. Product evaluations in procurement are also becoming more significant: In this sense, colleagues giving help & recommendations become virtual friends.

4. Taking a Differentiated Look at Service Procurement
When it comes to procuring services through e-catalogs, different catalogs and their respective features will need to be taken into consideration. Standardized services, such as consultancy contracts or internal services, are already a reality. Complex products must be portrayed using forms with different variants and to also allow comprehensive price calculations or interaction with third party systems.

Services based on standardized service directories will be on the rise in electronic procurement in the coming years. Collaborating with suppliers will become even more important. Service orders can be inquired and reviewed and clarified by suppliers prior to contracting. The concrete contents and details can then be reported back to the purchaser after execution.

5. Flexible Use of the Internal Product Search
The idea of a single, central search engine for use in purchasing is in development. It must be integrated in portals in the same manner as with the SRM and ERP systems. It also provides the basis for the search for masters files. At the same time, the catalog seamlessly integrates into the respective third party system. A modern catalog system also offers all necessary interfaces, so that the above named systems can directly access price information in automatic order runs (i.e. article prices for MRP runs, update sources, EKI etc.).

In summary, more and more elements from B2C trade and social commerce are finding their way into electronic procurement. As this happens, transparency and analysis are also becoming more important. Watch my talks about the most important factors for successful catalog procurement on Heiler TV (http://tv.heiler.com).

"e" leaves "Commerce"

2010-06-15T01:28:00.000-07:00

We carried out an online seminar in the USA on "eCommerce meets PIM" together with Bryan Walker (principal analyst at Forrester Research). We had a far bigger response to our invitation than we planned, with over 600 registrations.

Multi Channel Reality

Bryan used his presentation to clarify the meaning of product content in all modern sales channels. Multi channel has long been a reality since its implementation. More than 70% of US consumers research first online before they – however they do it – buy products. 85% of US consumers use multiple channels. They purchase in stores but also, at the same time, over the Internet, by phone and more and more with mobile equipment such as iPhones and now even iPads.

Direct sales are changing the distribution channels

Another figure shows how important it is for manufacturers to be have direct customer contact via the Internet: 46% of all consumers already research directly on manufacturers' Internet sites. In addition, more and more manufacturers are opening stores on the Internet. Production and retail are increasingly growing together. Or, put less positively: more and more retailers are facing direct competition from manufacturers. This represents a definite danger for retailers stretching far beyond the question discussed up until now of what influence Internet shopping has on the prices for specialist retailers with stores. Such questions are rather irrelevant to consumers. They click on the "checkout" which they completely trust and where they can get a good price. Trust is based on security. And security has lots of aspects on the Internet.

Limited investment in product content

Some of the questions that web providers have to answer for consumers online today, before they order a product, concern the product content. Perfect product descriptions; detailed pictures and videos; as well as tests, reviews and ratings strongly influence people's decision to buy products. However, in relation to the relatively high investment in online stores and customer portals, very little is invested in content management. Distributors spend less than 3% of their costs on product information management. It's no wonder that many stores with products that don't display commodities (such as cellphones, digital cameras etc.) are not successful. The customer gets an unsatisfactory idea of the product and is not prepared to go ahead with the purchase.

Multi channel PIM strategy

The Forrester analyst leaves no doubt that retailers need to draw a clear picture of their customers' behavior. Today, a retailer needs to know where their customers go on the Internet; where they get their information; what motivates them to purchase something; and why they have decided on a specific channel. But manufacturers must also understand that the product content they generate will be automatically replicated on the Internet and reappear in all channels without them being able to control this flow of information. They can, however, control the quality of their product information, creating a USP amongst their competitors. Bryan Walker recommends that retailers and manufacturers "develop their own product information strategies because your customers expect this from you."

When choosing the suitable PIM solution, he recommends that they look closely at the technology providers. I can only agree with him on this. The differences are quick to see when it comes to complex processes and large amounts of data. One more thing can be said: multi channel almost always puts you in control of complexity. Which is why the old IT themes of user friendliness, stability and performance still play a dominant role.

"e"

Following Bryan Walker's presentation, one can remove the "e" from the term "eCommerce". Commerce without the "e" no longer exists in the real world. I agree with his view that: "commerce meets PIM" and have forgotten the "e" already.

B2B-Channel: "Punch-Out"-Procurement

2010-05-24T22:55:00.000-07:00

Is it purchasing or procuring? The difference first became crystal clear to me 8 years ago when talking to our customer (a large Stuttgart-based automobile manufacturer) about his procurement solution. He still calls the system eShop today. But back then there was no talk of a purchasing experience. First, it was a matter of the operational procurement costs of indirect material for the company headquarters, later for the overseas companies, and in the meantime a global procurement platform for many subsidiaries.

At the time, it was mainly process costs which were to be reduced in the companies. Only much later did we, together with the customer, concern ourselves with the purchasing experience. Today, more than 400 enterprise customers use the Heiler Business Catalog as a procurement shop. Some of these customer receive up to 300,000 hits per day and have 5 million sell-side products. First and foremost, customers want to make sure that only those products and items which comply with a narrow, predetermined product selection made by the company can be ordered by employees.

But what's that all got to do with PIM?

Well, these internal corporate shops (preferably referred to as procurement, but also as 'Supplier Relationship Management - or SRM systems in short) today represent significant marketing channels for many distributors and dealers. To begin with, these distributors use the PIM solution to create catalogue files from their master file data. Initially, customers only wanted simple data sets from their distributors on CD-Rom. But soon BMECat-XML became standard in Germany and xCBL was introduced in the USA. These formats could also display more complex catalogs in a standardized format. However, this did not run in quite such a standardized way. There were - as so often - variations of the standard and to begin with formats had to prove the test of time in daily business operation. Thereupon, corporate customers increased their demands in terms of special product ranges, languages, media assets and, above all, customer-specific prices. Because PIM was able to do all this too, customers then came forward with a new request: "differentiation of the organization structure within the corporation". Or to put it more simply, customers wanted the product content to be processed for several procurement sides. This was also made possible, both in PIM as well as in the procurement catalog for purchasers.

And how did this develop alongside pure procurement? Not a lot was found in the users' (consumers') catalogs. The unpopular maverick deals also came to a halt. Thus product ranges were expanded and product presentations improved.

Nowadays, there is a trend to link directly the Group-wide procurement system with the e-commerce system of the distributor. The principle is called "PUNCH-OUT" and is simple: The order catalogue, including the user guide, is connected to the customer's transaction system via the Internet, e.g. via a so-called OCI interface. Of course, the sender (distributor) must support all B2B facets and variations already known by the internal customer system. The demands on distributors by key account customers are, however, substantial - in particular in terms of catalog management, price and product range control and also the quality of product data. Here, as is so often the case, the devil is in the detail.

In 2004 we implemented such a B2B sell-side solution for the first time, with software at either end, for a large electrical materials distributor. Since then solutions have become vastly more refined. PIM and catalog ordering solutions must form a unified whole, otherwise it just doesn't work - especially with the demands of a key account customer. And the requirements of B2B customers are growing further. In more and more cases, they are looking to create an inspiring purchasing experience for their 'consumers'. I will explain why in another blog shortly. Perhaps I'll call it, "The Amazonization of purchasing in 2010" or something like that.

When I think about it, it hasn't really been a simple matter of procurement with the B2B channel for some time now. Therefore from now on we'll call it "Purchasing with a positive procurement experience".

Blue films and white goods categories

2010-05-21T07:38:00.000-07:00

Treemaps in PIM-Cockpits give us an overview

All my private media assets are stored on my Mac hard-disk labelled "Media". My iTunes collection with aprox. 1300 songs (turquoise block), around 22,000 photos (auburn block) and a few large HD video files (blue) are all stored there. Recently, when the drive was almost full, I read about the free "Disk Inventory" software in a Mac magazine. The software, it was promised, provides an overview of the space being wasted on the hard disk. What a surprise! The blue 16Gb monsters (1080p-Apple ProRes 444 files) were the cause of my lack of storage space. Disk Inventory works with the Treemap algorithm, which displays a systematic chart consisting of rectangles. In this application, every file is displayed as a rectangle, proportional in size and arranged according to directory.

After a long wait, Michael Fieg was the first to suggest Treemaps in PIM. Our product management team subsequently experimented with the UI paradigm. Using the Heiler Product Manager (HPM 1.5), we defined and created in just a few minutes a Treemap export that contains the sales and quality information for more than a thousand products. The individual boxes were generated according to the category of goods. Turnover determined the optical field size, and the quality status determined the color of the item. This produced the following image:

Using this cockpit with an HPM view, the user was able to directly identify and select the appropriate items that record high turnover and yet have poor data quality. Furthermore, the category manager can see with just a quick glance that the goods category 'batteries' is not in such good shape. For instance, the items have no correlating image and there is no indication of their classification. If the cursor is held over a field, further data regarding the quality or quantitative information of that particular item is displayed. With a click, the user can now select the appropriate goods category and open a selection of items in order to carry out a data management workflow.

Where do we go from here?

PIM know-how on demand

2010-05-21T07:34:00.000-07:00

According to the experts, in the not too distant future "Video on Demand" will replace traditional broadcast television. Customers who already have experience of Apple TV or other IP-TV solutions know that our viewing habits will change substantially in the coming years. The influence of this on traditional advertising markets can already be anticipated today, by looking more closely at the business model of Google or the iAD coming soon from Apple.

VoD is perfectly suited to education and training. With Heiler-TV, Heiler has made the first global contribution regarding product information management for this medium. The first training videos and "Infomercials" can not only be found under the domain http://tv.heiler.de/, but also on youtube at http://www.youtube.com/heilersoftware.

Have fun learning!

Good Morning Dave

2010-05-21T07:30:00.000-07:00

GENERAL INFORMATION ABOUT THE PIM COCKPIT

The idea came to us as we were watching the film classic "2001: A Space Odyssey" for what was probably about the thirty-fourth time. Not only because the ship's on-board computer, the HAL 9000, had a sensational CU and Peta-Bytes of storage space. Its most impressive attribute was its Audio-OS, which had a UI complete with an interactive androgynous voice (at least in the German version anyway). This could have made it easy to overlook the even then perfect onscreen graphics that had been developed for HAL. The cockpit was able to persuade and convince by consistently reducing all information down to the bare essentials.

With a PIM-Cockpit we are again only interested in the answers to a select few questions:

Basic
1. In which distribution and marketing channels have I publicized a special product?
2. With what level of quality is product information related to customers?
3. How up-to-date is this information?

Necessary
1. Which data must be managed?
2. Who delivers this information?
3. When will the information be complete?

Desirable
1. How successful are the products?
Which channels are producing good sales?
3. Where and how do my customers find product information?

Stanley Kubrik shot the film in 1968 - 42 years ago. Even back then his understanding of GUI and process visualization was superior to that seen in the majority of present day software applications. However, when HAL greeted the Commander of the Discovery, Dr. David Bowman, in her inimitable manner each intergalactic morning with the phrase "Good Morning Dave", it became clear to us how far from the future we still are.

Social Commerce

2010-05-20T04:41:00.000-07:00

Our experts, Michael Fieg, Christian Farra and Ben Rund about Social Commerce.

Twitter, Facebook & Co are on everybody's lips. Opinions are wide-ranging, from nonsense to mega-hype, on the significance of the micro-blogging services on e-commerce and multi-channel trading.
In Germany, 36% of online shops already have Twitter embedded, while 20% are planning to introduce it. This was the result reached by an investigation carried out by ibi research at the University of Regensburg.

Many companies are already reporting that their turnovers could increase significantly through the implementation of social media channels. Interactive media increase dialog with the customer. Putting aside a purely sales-figure oriented mindset, they enable authentic and direct communication with the customer. New customers can also be made aware of product offers.

So is the phrase "the trend is your friend" particularly apt in this instance? Online social networks are growing and increasingly influencing communication, be that in the business world or the world of the consumer. E-commerce prescribers must analyse precisely and decide which of their target groups can be reached through this medium. At present the media is particularly applicable to a target group of technology enthusiasts who love to experiment.

The decision whether or not social media should play a role in your communication and business strategy, and indeed what that role should be, cannot be made by this report. This report does, however, outline the important factors. This white paper takes a look at First Movers, who believe in social commerce and hope to discover what significance Product Information Management (PIM) has in this context.

Two thirds (67%) of customers who research a brand on Twitter are subsequently more prepared to buy that product. On Facebook this applies to 51% of users. There is hardly any distinction between the expectations of men and women. Females prove to be more prolific bargain hunters. The following figures from a study by Chadwick Martin Bailey support this notion:

Female target group: Why are you a fan of brands/companies on Facebook?
1.    In order to receive offers and discounts: 30%
2.    Because I am already a customer: 20%
3.    To show others that I like this brand: 15%
4.    For fun: 10%

Male target group: Why are you a fan of brands/companies on Facebook?
1.    In order to receive offers and discounts: 23%
2.    Because I am already a customer: 23%
3.    To show others that I like this brand: 18%
4.    For fun: 11%

With regard to B2B communication there has, to date, been a lack of clear evidence that a relationship between social networks and a decision to purchase really exists.
What is most clear is that customer feedback takes on an increasing significance in the world of web 2.0. A review posted online can be extremely exciting and effective, but only if I, as a retailer, am permitted to re-use this information. Staples, the office supplies discount store, has around 60,000 Facebook followers. On its fansite Staples publicises its current promotions, as well as discount codes and discount deals. Customers comment on and review these deals. Here PIM supplies the appropriate product data.

Shoes allows customers to review their products on Facebook. Shoes' customers can subsequently arrange the product list as desired. The Facebook user is sent to the linked store via a "Buy online"link.

Facebook is especially well suited for image galleries. Fashion store Mary & Paul demonstrate, albeit somewhat tentatively, what is possible. However, the fact is that, for fashion in particular, a Facebook shop window can be a way to reach potential customers. The appropriate images are provided by PIM using integrated Media Asset Management (MAM).

The Otto subsidiary Jungstil allows customers to select potential store products and displays them using (amateur) video content. This is more authentic in every way.

Jungstil goes even further: Customers have the opportunity to import "their" outfits onto Facebook. The photos are then commented on and reviewed by fashion journalists and bloggers. The winners receive prizes. Jungstil has thus created a direct channel to an unbelievably large community of fashion-loving customers. As far as some industry experts are concerned we could be looking at the "product managers of the future". There is a growing understanding that the female customer base in particular know which clothes they are going to be wearing in the coming summer.

Product data in social networks will thus be loaded with customer opinions and should be fed back into a Product Management System (PIM). This information then displays these allurements as soon as they can be used in other cross-medial sales and advertising materials. We are thinking along the lines of product flyers, mail outs or catalogs. These customer opinions also play an important role for product or category management in the selection of product lines.

This screen shows how customer reviews from Facebook are centrally stored in Heiler Product Manager.This top has an average rating of 5 stars, while the brand has 43,678 fans.

Direct customer opinions from the interactive web can be gathered and evaluated immediately. Which reviews and comments have been made by the target cluster-group, "German, 13-16 years old, female" can thus be precisely analysed. In this way, product information management facilitates the segmentation of target groups in social commerce.

Today's customer is a hybrid. Evidence shows that he is using more channels to get information on products before a sale occurs. Multi-channel is therefore not just a fleeting trend but a compelling necessity. Experts also talk of so-called cross-channel marketing, which is used within a particular marketing channel to draw attention to further sales channels. For example, a mail order company will advertise its catalog via its website, and vice-versa. Or its store on Facebook.

With Youtube, Facebook, Buzz and Twitter, a further sales channel has arrived in the e-commerce world. With it the danger of data sharing, inefficient processing and inconsistent product communication is increasing. The call for a solution to put in place central product data management and central communication is being reinforced more strongly than ever. The Enterprise Product Information Management (PIM) system solves just this problem.

We would love to know your opinions on this. On which social media platforms could product presentations increase turnover? Cast your vote at: http://heilerpim.wordpress.com/pimpolls/

Get a closer look at the offers from Heiler Software on Twitter, Facebook and Youtube. Find out all there is to know about products, white papers or best practices, in real time.

Find out more about PIM 360° at: www.heiler.com/pim360

Multi-Channel-Commerce

2010-05-20T04:36:00.000-07:00

From the point of view of businesses that specialize in the acquisition, preparation, and distribution of product information, the motivational factors for the initiation of customer projects have changed massively over the past several years. Enterprise Product Information Management (PIM), which has become an uncontroversial, important business process, provides a variety of solutions to problems that occur as marketing and sales-related product information makes it way through the business landscape.

Looking back, the drivers of enterprise PIM have been on the selling side. Specialist solutions for output processes — print, in particular — had been available for many years. But it was not until people started to realize that PIM was particularly useful whenever data were generated by a PIM process based on a standardized, enterprise-wide repository that the solutions that exist in the enterprise PIM segment today were arrived at.

The subjects on which projects focused, along with Enterprise PIM, were the consolidation of supplier data, the creation of the "golden record" as an enterprise "place of truth", internationalization linked with a process-secured ("global-local") creation process, and of course in depth integration with the backend. Responsibilities also changed within corporations. The head of marketing's partially-automated print solution became the CIO's enterprise PIM.

Just as enterprise PIM emancipated itself between 2002 and 2004 by staking a new claim for the all-encompassing significance of product information as a business process, it is now on the cusp of a new stage in its development. The marketplace is increasingly focusing on enterprise PIM as the "long-lost brother of e-commerce".

But let's start at the beginning: what issues drive PIM projects today? Andrew White, a Gartner analyst, first introduced the "MDM era" as the successor to the "ERP era" in the fall of 2009. Gartner positions MDM as an enterprise-wide repository. In the scope of this repositioning, Gartner took the opportunity to coin a new term: "MDM for product data" instead of PIM.

Multiple channel distribution is becoming increasingly important, irrespective of whether the businesses in question are B2C or B2B-focused. Target-oriented distribution over different channels such as online stores, print catalogs, and point of sale opens up new target markets and increases awareness in the marketplace. It is precisely these developments in the area of multi-channel commerce which make the idea of a centralized PIM solution attractive. The key drivers are the long tail, multi-site, and changes in category management.

Long tail

Particularly in the area of distance selling, product selection policy has seen major changes. Previously, category management meant always having to deal with limited space. In a print catalog, only a certain number of pages were available. The logistics were also limited: storage limited the possibilities so clearly that most dealers attempted to find the perfect "catalog selection" with the highest number of top-selling items.

In our projects, we see these product selections in companies. It quickly becomes evident that compromises have been made in the selection of products. In most cases, only certain brands are carried, for instance. Or a segmentation of the product and target groups is performed. This is certainly useful for print catalogs, but online stores don't have these limitations!

In stationary retailing, the product range must be closely geared to reflect customer demand, due to the limited selling space. In doing so, particular account is taken of the demands of the majority, while anything that is not sufficiently profitable is often ignored. Many products remain unsold for this reason – it is precisely these which are the "long tail". The term derives from a graphical representation of a frequency distribution.

When one considers the margins, this distribution also has a highly interesting meaning: in most industries, the fast-moving items intended for the masses have a particularly low margin. Consider the market for music. What do you think has a higher margin: a top ten CD single, or a rare collectable album? The rare album, of course! This means that in the past, retailers had to forgo high-margin products due only to limited floor space, limited pages in catalogs, or perhaps due to limitations in their IT systems!

The long tail consists of a wide variety of products: a rare bottle of wine, special interest music, exotically spiced roasted peanuts, films that have been deleted from back catalogs, highly specific spare parts for which there is little demand. The list is endless. There is no shortage of products for which there is little demand. They are seldom available, however.

Compared to all other distribution channels, the Internet offers us considerable cost advantages. The digital mall consists of servers which can be readily expanded when necessary. Adding a new product takes little more than a few additional database entries. And perhaps a little space in a logistics center with efficient operations, or possibly run by the service provider – and in the case of purely digital products not even that: sending a digital music track over the Internet costs the retailer more or less nothing.

The only question is why retailers haven't been massively expanding their product ranges for years. Why are we seeing product selections numbering 300,000 items with typical B2C dealers, instead of 3 million items? The leading store systems and search engines are designed for these large product ranges. It would not pose any major problems.

There is a problem, of course: before products can be presented in a store, the product data must be obtained from suppliers and processed. In many cases, product ranges are also limited by the fact that the product data cannot be efficiently maintained.

It is here that the new PIM strategies are brought to bear: with an enterprise PIM solution, retailers can build and maintain extremely large product portfolios. For the first time, retailers can now use an integrated process: suppliers provide their product portfolios in electronic form. These data are checked and stored in a central repository. They are then structured and prepared for presentation in the stores.

Multi-site

In the past, a strong tendency towards vertical integration on the part of manufacturers has been evident in the retail sector. Manufacturers have not only set up flagship stores to attract more demanding customers and position their brands, they have also attempted to boost their turnover by setting up their own product presentations in retail outlets. This integrated product presentation is referred to as shop-in-shop. Retailers are showing an increasing tendency to set up brand and manufacturer-specific web stores.

Beside shops-in-shops, manufacturers are increasingly setting up target-market specific presences. If one investigates the online strategies of the large mail-order retailers, one finds both an increasing diversification of brands, and an increasing tendency to cross-sell. SportScheck sells a pair of Adidas sport pants in the Adidas-branded store on sportscheck.de while also cross-selling them on otto.de and on other platforms such as amazon, for example.

The complexity of handling product data arises from the multiplication of language, sales area, target group, brand specifics, and platform. With every additional website that requires product data, enterprise PIM gains greater importance as a central clearing house. Enterprise PIM is a precondition for the successful management of a large number of stores!

Changes in category management

Changes in the area of product selection strategies represent a further factor for the re-orientation of enterprise PIM. The massive growth of product portfolios in the marketplace has led to fundamental changes in the area of data management.

These changes are most clearly evident in the area of mail-order sales. In the context of a multi-channel strategy, PIM is typically positioned with the following process requirements: centralized data administration, increased automation, reduction of manual processes, reduction in media discontinuities, strengthening of clear responsibilities, early data capture, accelerated data availability, reduction of errors. In a real business, the following points would trigger an enterprise PIM project:

· Several employees are continuously occupied with copying and pasting image and text data from an existing database, in order to make them available to third-party users.

· Catalog page briefings (for print catalogs) typically involve the use of pen, paper, and scissors.

· Raw image data cannot be used for the design of web pages.

· 60% of all items in the web store were "re-digitized" from the print catalog.

· A call center employee has to check up to four systems simultaneously in order to supply the customer with all the required product data.

· In some cases, the same piece of text is translated multiple times per target language; and separately for online and print.

Growth of product portfolios has thus had an enormous impact on the data maintenance scenario. Until recently, back office staff may have manually maintained product group information article by article, but now this is no longer possible, or at least not as a sequential task. New processes are required here! In order to promote the "relevance" factor in data maintenance, we now import customer ratings from the various online stores into the PIM system. The employee simply navigates to the poorly-rated products. These are usually the products that have to be described more accurately... online stores thus provide an excellent source of real-time data quality ratings.

Organizationally, these changes in category management will lead to a restructuring of departments that have traditionally been responsible for data acquisition, maintenance and output planning. In many businesses, the publication specialists responsible for the print channel are organizationally separate from those responsible for the Internet channels. This often leads to redundant product data maintenance, and a failure to exploit synergies. The tangible indirect effects of this are different product presentations in print and on the Internet, different product portfolios, a huge manual overhead when transferring content between media, and redundant storage of product facts within the enterprise.

In the case of leading mail-order retailers, there has been a realization in the past few years that the convergence of presentation channels leads to a restructuring of departments. Reorganization serves two objectives:

· Simplifying and standardizing data creation. The purchasing department now has a new role as a supplier of highest possible product information quality.

· Publication planning is becoming increasingly flexible and will typically span multiple output channels. Any differentation between online and offline channels should be consciously avoided.

Conclusion

Following the emancipation of enterprise PIM as an independent business process, it now stands on the verge of a new stage in its development. Enterprise PIM (or Gartner's "MDM for product data") is once again gaining importance in marketing and sales: enterprise PIM is a prerequisite for successful e-commerce!

* Gartner Master Data Management Summit, October 5-7, 2009 Hyatt Regency Century Plaza, Los Angeles, CA

PIM 360°

2010-05-20T02:36:00.001-07:00

Companies need a 360-degree view of their product data

Not all companies today establish a consistent and transparent process in the Product Information Supply Chain. This starts at the data acquisition stage. In particular, the benefits of internal use in different areas are often underestimated. In sales, such companies and their product managers today often think and work in a more channel-specific manner, both within the corporate organization and in their daily activities.

The catalog department in marketing asks: "How do I best place my items in the print catalog?" The e-commerce team worries about making the best presentation possible in the webshop conversion. This, however, obstructs successful multichannel commerce. Print catalog data are maintained for online searches, for example, but because of the lack of synonymous keywords they are never found. Revenue potential goes wasted.

Successful multichannel commerce and e-commerce need perfect product data. Between data integration and the increasing number of different marketing and distribution channels, however, there still lies a great deal more. This is right where PIM 360° comes in.

Following the motto "Integrate - Manage - Sell", PIM 360 begins with the integration of product information, takes in corporate data management and ends with multichannel commerce.

What exactly does PIM 360° mean?

Data integration: Dealers must be able to assimilate into their product range even large amounts of supplier data through automated professional workflow and verification mechanisms. Many suppliers provide product information in different formats, whether this be CSV, Excel, Data Standards or BMEcat. Modern solutions can merge these formats in one step during importation.PIM 360°, however, also ensures deep ERP data integration. Making PIM the leading system for product-related master data is recommended.

Data management: The issue of product data governance within companies is still often neglected, and yet precisely here lies a great business value. Getting access to and working with consistent, centralized product and master data is of immense importance not just for marketing and distribution channels. PIM 360° ensures complete transparency and rapid work processes in purchasing, research and development, product management, logistics and finance. With each new product or company acquisition, decentralized data storage multiplies the information chaos. Poor data quality leads to inefficient internal processes and also to inaccurate analysis on the basis of which decisions - possibly the wrong ones - are made. PIM 360° ensures the right information ends up with the right employees and departments. Especially for large, international companies, there slumbers here an enormous potential in terms of efficiency. Knowing which resources are linked to all departments, branches or regional companies through the continuous harmonization of different data silos or through complex searches, one can increase productivity across all areas with PIM 360°.

Multichannel business: In e-commerce, PIM 360 °means that Enterprise PIM systems can seamlessly operate the world's leading e-commerce solutions via standard interfaces: ATG, IBM and Intershop rank among the global players here. However, customized punchout catalogs or direct integration with e-procurement systems of large customers can also be served in this way.

Through the integration with a media asset management solution (MAM), the PIM checks which product images are placed in advertising media. Deletion of an image and video that is still being used in other places is thus avoided. Various derivatives such as pictures in high or low resolutions can also be automatically created and stored for print and online media, and linked with the PIM.

In sales, PIM 360° helps sell more. In inside sales, field service or call center. As an internal information portal on all available products, it helps all sales staff make optimal use of up- and cross-selling potential. No more leafing manually through catalogs and price lists. The sales department always has the right offer at hand at the right time. This increases customer loyalty, making retailers and manufacturers No. 1 with their customers.

Consulting and Implementation: The panoramic view is also needed in the introduction of PIM solutions. A successful project methodology encompasses all facets of product data management: Not just sales, but data acquisition and data management too.