The almost instant gratification of using a PIM couldn’t be any more convenient. By taking the time to implement one, businesses can improve communication among teams and increase efficiency while boosting their bottom line! Although there are some initial setup costs involved with implementing your own personal information management system (Pims) – which we will discuss later on in this article- long-term gains make it worth every penny spent for any company serious about growing business success through excellence at all levels: executives, managers…everyone!
We will discuss what a PIM system is and how it can help you streamline your workflow. We’ll also take a look at :
What is a PIM system?
Why a PIM system?
Advantages of PIM
Challenges related to PIM
PIM versus other solutions
How does a PIM work?
Different PIM solutions
Product Information Management (PIM) is a technical solution in the form of a system, which must keep the fragmentation of product data throughout the lifecycle and the sales process of a product consistent and centralized.
That’s a pretty good explanation. Rightly so, because Product Information Management – PIM for short – is also a decent system. So let’s cut the explanation above and look at the meaning of the different keywords. Later in this long read, we delve deeper into the different features of PIM systems.
What is a PIM System?
PIM is a technical solution in the form of a system. In other words, PIM is software, just like, for example, your ERP system and your CRM system is software. In most cases, PIM systems integrate very efficiently with other systems, such as an Enterprise Resource Planning (ERP) or Data Management Platform (DAM) system.
PIM is concerned with the fragmentation of product data. This is the hallmark of a PIM system. In an omnichannel world, in which data also comes in from many sources (think of many different suppliers, information regarding the supply chain and supplies) and is also brought out through many roads and systems (think mainly of your webshop, retailers, offline and other points of sale), a PIM solution ensures that data is consistent in all places.
Consistent in this case means universally the same (for example, units of measurement: inches become centimeters, etc.), but product names and descriptions, specifications and especially discounts and prices must also be communicated the same everywhere. Consistency therefore also means that this product data must be up-to-date at all times.
88% of American companies are expected to have been affected by bad data quality, with the average company losing around 12% of its revenue. On top of this, IBM has estimated a loss of $3.1 trillion each year for the US economy as a result.
PIM plays a role during the life cycle and the sales process of a product. This means that the information about the product already arises during its production and from that moment on must be consistently passed on to all organizations, brands, and people who come into contact with it. Adding new product photos, specifications, or, for example, price adjustments are also part of the life cycle of a product. Some systems can even carry (links with) sales figures and the like. In addition, product data must be communicated consistently throughout the sales process.
A PIM system makes product data centrally manageable. After the consistency of product data, this is probably the second major advantage of a PIM system. Product data can be viewed and managed in one place.
Why a PIM System?
The demand for PIM systems is actually a very logical consequence of the rapid development of e-commerce over the years. But changes in customer behavior and new wishes and requirements also play a major role in the growing popularity of PIM systems.
Modern e-commerce players use many systems and often have different suppliers. So data comes in different ways and is also stored in different ways. That goes faster than you like and at the expense of the integrity of data.
For example, an ERP system offers a great solution for data, but mainly internal data. Think of business intelligence, and data from your CRM, HR, and production processes. However, what is missing in this solution is product data.
This can be very damaging not only for your own supply chain. In addition, it is simply not efficient to have fragmented product data stored in multiple places. You prefer to put this data in one place in one go and let it communicate automatically with all your other systems.
Communication with the customer must also be optimal today. You want to communicate product specifications consistently, as supplied by the supplier. You also want to keep updating prices or other data, such as product images and reviews, in all your communications. This is something that the customer can demand and even expect today.
For Whom Is A PIM System Valuable?
A PIM system is a modern solution for e-commerce organizations. In particular, organizations that work with many suppliers, a wide range of products and multiple marketing and sales channels (such as webshops, apps, offline, etc.) are becoming increasingly dependent on PIM systems.
So: What type of employees within an organization need a PIM?
- Marketers. One of the most desirable features that a PIM system has to offer is the consistency of multi-channel product information. A marketer watches over the so-called “product experience” that a customer has, at every stage of the customer journey. High-quality product information that is always up-to-date is essential for this.
- Retailers. Collaboration and therefore relationships with suppliers is extremely important. A PIM system is necessary to always guarantee the quality of product data and information and thus the life cycle of products.
- E-commerce manager. As a manager, you understand the impact that the quality of product information has on your sales.
Advantages of PIM
Let’s list all the benefits of Product Information Management:
- Consistent product data
- Uniform customer experience
- Faster and smarter management
- Omnichannel data delivery
- Integration with your e-commerce system
- Integration with other systems
Consistency Of Product Data
The most important advantage of a PIM system: is the consistency of your product data.
A PIM system makes it possible to work with what we call Master Data. Master Data is the leading data for all channels and systems that work with it. This enriches the product data for all your systems from one data source – the PIM system, in this case.
With this, you tackle the problem that arises as soon as product information is fragmented and not linked in different places. This also includes information in accounting programs and warehouse management systems, if that applies to you (and otherwise to the supplier).
Just as important is the consistency in the product data you distribute to your channels. We are of course talking about product descriptions, photos, prices, discounts, and stocks, but also suggestions for related products.
Uniform Customer Experience
Naturally, this leads to a huge advantage for the customer experience: it is uniform. It is a real shame if you lose a customer by not having your product data up-to-date. Suppose the figures on product stocks are not up-to-date in your data feed towards channels such as Google Shopping, then chances are that you have to disappoint your customer afterward because the product is out of stock.
You also want to tell the same story everywhere. Therefore, consider your product data as an important form of content. Product specifications and updates or prices must be omnichannel up-to-date to optimize your campaigns.
Faster And Smarter Management
We talked about Master Data. A PIM system makes it possible to manage your data from one place so that it is continuously up-to-date in all places. You can (and want to) automate a large part of this by linking it to, for example, your ERP and SCM (Supply Chain Management) systems.
This saves you a lot of time because you manage all fragmented product information in all places at once and therefore update it if necessary. It also saves you a lot of frustration and you ensure yourself of data that is more honest.
Omnichannel Data Delivery
Not only do your internal processes regarding product data remain up to date. From a marketing perspective, a PIM system is a perfect addition to your ERP system. It does not always have sufficient options for your marketing data.
The need for enriching content also makes a huge difference per product type. A PIM system also offers better support for this. And you can easily distribute that enriched data to all channels: your e-commerce environment, but also your app, store, or marketplaces. This way you are assured that the customer experience is consistent.
Integration With Your E-Commerce System
It actually speaks for itself: you can integrate modern PIM systems seamlessly with your e-commerce environment. A link with, for example, Magento 2 is absolutely possible. You can even go as far as you want. Linking your e-commerce system with a PIM is often custom work.
Integration With Other Systems
A PIM system is not a replacement or better version of another data management system. See it as the necessary addition to, for example, your ERP. Most systems can be integrated effortlessly with your current systems.
In addition to an ERP, which connects, manages and automates the majority of your business processes, a PIM system is a highly desirable addition. This is because an ERP is a system that shreds product data. Logical, because fragmenting and distributing data to the right places is his function. However, keeping this up to date is not covered.
based on certain characteristics of this product. It is more important than ever to help consumers find the product they are looking for. It is not without reason that the search and filter options on web shops are used so often. With the right taxonomy, you organize your products so efficiently that, based on the correct product data, comparable products can be displayed as a recommendation to the consumer.
A full-fledged PIM system enables efficient taxonomy and its management. This allows you to manage your product groups and categories from one location and ensure that they are distributed across all your channels in a logical and consistent manner.
A PIM system ensures more efficient communication between suppliers, seller and the ultimate distribution of information to other channels. A lot of work that previously had to be done manually, such as processing product data in multiple systems, cleaning and enriching it, transferring it to other channels and of course keeping all that information up-to-date, takes a lot of time. If a large part of this can be standardized and automated, the result is often that the time-to-market can shrink considerably.
Lower Costs Per Product
Time-to-market is a result of more efficient use of product data, which saves a lot of work. Logically, this also automatically reduces the costs per product.
Challenges Related To PIM
Obviously, like all systems, a PIM also presents some challenges. The main ones are:
- Complex application in marketing
- Extensive digital media
- Limited e-commerce analyzes
Complex Application In Marketing
The PIM system is primarily built for easy rear integration with your existing systems, and for managing product information in one place. That should make the application of product data in your marketing communications more consistent, but not necessarily easier. The workflows of PIM systems are not particularly flexible because they are mainly built for technical purposes. Marketers with less technical skills often have difficulty understanding PIM systems to optimize their marketing strategies and campaigns.
Extensive Digital Media
PIM systems are primarily built to centrally store and manage product data. This does not always include content such as digital media – especially if these are larger files such as longer texts, product videos or other larger assets. The distribution of this digital content to the right channels and in the right ways is usually a bit more difficult than, for example, overshooting product specifications, prices, and stocks.
Limited E-Commerce Analyzes
A PIM system is not the most ideal system for analyzing sales figures and marketing performance at the product level. Also, the systems are normally not so smart that advice can be made for changes in any product data.
PIM Versus Other Solutions
A PIM system is a nice addition to your current e-commerce tech stack. However, the term is often confused with other solutions and systems. It is important to know that in principle a PIM can never be replaced by other systems, as is the case with many e-commerce solutions and modules.
Time to put the most important equations on paper.
PIM Versus ERP
ERP stands for Enterprise Resource Planning and is the umbrella term for the software used to support (almost) all processes within an organization.
For many e-commerce organizations, the ERP system is a spider in the web to allow different processes and departments to work together more efficiently, and thus to largely automate them.
As you can clearly see in the image above, an ERP links most of the processes required to keep e-commerce organizations running. But product data and product information is a profession in itself. Keeping that data up-to-date during the life cycle of the products is hardly possible by keeping ERP systems up to date because these are not the tasks of an ERP solution either. It is purely about the processes within the organization itself.
That is why a PIM is usually seen as the necessary addition to an ERP. You could say that an ERP is the beating heart of the organization that keeps all movements active, while a PIM system ensures that all product information is pumped in the right direction, thanks to this beating heart.
PIM versus PCM
PCM stands for Product Content Management and is the most logical comparison with a PIM system. However, a PCM is sometimes also described as a Product Catalog Management, although this does not make much difference in the comparison with a PIM.
A PCM is in principle a standard functionality within most e-commerce solutions, such as Magento and Shopify. This mainly concerns enriching product data, such as adding descriptions, attributes, images, and so on.
A PIM system does basically the same thing, with three very important additions:
- Collection & connection: collections of product data are collected in one place and connected to each other.
- Quality; the consistency and integrity of data are created, making errors easier to find and making adjustments faster and more efficiently.
- Syndication: data can be pushed to all channels and platforms at once.
PIM versus PDM
PDM stands for Product Data Management and, just like a PCM, resembles a PIM in terms of functionalities. The biggest difference is actually in the name: the difference between data and information. In this case, data is something “raw” and disorganized. It must first be converted before it is made understandable – or before it is information.
In this case, data is mainly relevant for manufacturers and all processes that are going on throughout the entire life cycle of the product, while information can mainly be used by e-commerce specialists and marketers. Logically, the information collected and stored in PIMs is largely based on the product data. Because PDMs are also talking about the processes during the life cycle of a product, many PDM modules also exist within ERPs. Although these modules can hardly convert that data into valuable information.
You could, therefore, see PIM as an extension of PDM, which you need in the further marketing of your products after their production.
PIM versus PLM
PLM stands for Product Lifecycle Management and often works together with a PDM. Product Lifecycle Management (PLM) focuses on structuring product development and production processes and covers the entire product life cycle. A PLM is basically used by all departments to manage the product lifecycle. Think of engineering, logistics, sales, purchasing, etc.
In a PLM it is often also about the time aspect, such as project management during the production process and time registration. These are basically all events that take place before data can be shot to a PDM, which in turn provides a PIM with information. A PLM is, therefore, one of the power sources of a PIM.
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PIM versus SCM
SCM stands for Supply Chain Management and, like a PCM, PDM, and a PLM, is usually a system that works together with a PIM system, usually even in the form of an ERP or as an important part of it. In other words, one of the functionalities of an ERP is often supplying chain management. However, the principles of SCM and PIM are often compared and confused.
Supply chain management is literally about chain management or the management of all processes. An important part of this is the cooperation with suppliers and customers, in which a PIM system naturally also plays an important role. That is why in this case both are an excellent and increasingly necessary addition to an ERP system.
So the major technical difference is that most ERP systems support some form of supply chain management. A PIM solution is nowhere near standard in ERP solutions because the technology and objectives for this are so different from each other.
PIM versus DAM
DAM stands for Data Asset Management. The main difference with a PIM is actually that a DAM manages all digital assets of an organization, while a PIM looks at the life cycle of a product. And there is indeed some logical overlap.
A DAM looks beyond information and assets of products, although this is an important part of it. In your DAM you mainly store product images and the like, as well as additional images for marketing purposes, for example. But the system has to interfere less with sales data, shipping information, and the like. That kind of process really has to happen within the PIM system
A PIM system provides the DAM system with product assets, such as product images and videos. The system also ensures that these assets remain up-to-date if something changes, new product images are delivered, or whatever.
How does PIM work?
In terms of operation, a PIM system basically has three important, overarching functions that continuously follow each other in the cycle:
- Collect data
- Enriching data and converting it into valuable information
- To spread information
- So what you see happening is that a PIM system needs data to be put to work. Everything is thrown and organized on one mountain, and spread over all channels connected to the PIM system.
A PIM system is linked to various data sources and extracts the necessary data. There are of course a lot of data sources that you can link to your PIM system. The main ones are the following:
Your ERP system. The information from your ERP is necessary to keep all other processes that are essential for your product information up to date. Your ERP is the central system where everything is archived. Think, for example, of customer service and sales figures from all your channels.
Your CRM system. Information about your customers is also relevant to your PIM system. After all, you want to know who bought what, when it was bought, where it was bought, and so on. You could even use this information to boost your marketing efforts by understanding what type of customers are most interested in certain products. Moreover, the customer lifecycle is just as important to your sales as your product lifecycle, which is “monitored” by your PIM.
Your data management system or systems. Often product assets, such as images and videos, are centrally stored in a DAM or DMS (data management system). This makes it one of the more important power sources for your PIM system. In the meantime, it also works the other way around: if the PIM system notices that a certain asset has been replaced or removed, this information should also be immediately transferred to the data management system.
Flat files. Unfortunately, there are still many e-commerce companies that somehow use “flat” files that live somewhere on a server or local, such as Excel sheets and media files about products. These files also serve as a power source for your PIM system. This also makes PIM a solution for tackling inconsistent product information by storing data in multiple places, in separate files.
Your PCM, PDM and/or PLM . The type of management systems that focus more on the content, data and / or life cycle of your products also serve as a source of power for your PIM system. It is often the case that these types of systems were predecessors of a more modern PIM system, or are used, for example, by suppliers you work with.
The conclusion is that a lot of data sources can be linked to a PIM system. What this system also does is define and clean data.
In this phase of the PIM cycle, you also prioritize your product data or the sources which it comes from to avoid duplicate product data. Consider, for example, the difference in meters and inches or the quality of the media, that you receive from suppliers.
Enriching data and converting it into valuable information
What happens at this stage is the beating heart of the PIM system. It is put to work by the collected data that comes in and then pumps out the relevant information. Most PIM systems include the following important functions that are performed at this stage:
Enrichment of product descriptions. In the previous phase, data from multiple sources was collected, defined, and cleaned up and priorities were given to the various elements and sources. These are organized by the PIM system and enrich each other. Think mainly of technical information about the product, user information for the end-user and possibly even emotional information, such as customer reviews that are extracted from your ERP and/or CRM.
Taxonomy and Classification. One of the additional benefits of a PIM system was the taxonomy of products, which makes it easier to create product categories and hierarchies. That’s what is being done here. This happens at a later stage to make it easier for the end customer to find the product he or she is looking for.
Manage the life cycle. A PIM system gives you the ability to manage the processes and cycles of product information. This way you decide what to do with certain pieces of data, when to adjust it, which places to push to, and so on.
Check the quality, integrity, and consistency of data. The PIM system ensures that the data is consistent in all places. You as a user also have the power to control the quality and integrity of data.
Once data has been converted into high-quality, understandable product information, it is time to distribute it to all relevant channels. Through your PIM system, you ensure automated distribution to all your channels at the same time, make real-time changes, and connect it to all your e-commerce platforms, marketplaces, and other channels.
Manage multiple sales channels. It goes without saying that you push all up-to-date and consistent product information from your PIM to your main e-commerce channel, often your webshop. However, also consider POS systems in physical stores, marketplaces, marketing channels such as Google Ads and Facebook, mobile applications, social channels, and so on.
Manage what you push where. You don’t necessarily have to push all information to all channels at all times. Via your PIM system you choose which catalogs or attributions you want to push through to which channels.
Different PIM solutions
PIM is a modern solution for progressive and innovative e-commerce managers. Nevertheless, there have been different solutions on the market for a number of years. It is good to know that there are many systems that offer more solutions than just a PIM solution. In theory, you could also use some PIM systems, for example (in part) as a DAM system or a CMS system. It goes without saying that this depends on the entire e-commerce organization, your objectives, available resources, and so on.
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