The almost instant gratification of using a PIM couldn’t be 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 a PIM system and how it can help you streamline your workflow. We’ll also take a look at the following:
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; for example, your ERP system and your CRM system are 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 centimetres, etc.), but product names and descriptions, specifications and especially discounts and prices must also be communicated the same everywhere. Consistency also means that this product data must always be up-to-date.
The Impact of Bad Data Quality
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.
PIM plays a role during a product’s life cycle and sales process. 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. 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 significant 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 a very logical consequence of the rapid development of e-commerce over the years. But changes in customer behaviour and new wishes and requirements also play a significant 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 data integrity.
For example, an ERP system offers an excellent 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 supply chain. In addition, having fragmented product data stored in multiple places is simply inefficient. You prefer to put this data in one place 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.) increasingly depend on PIM systems.
So: What type of employees within an organization need a PIM?
- Marketers. One of the most desirable features a PIM system offers is the consistency of multi-channel product information. A marketer watches over a customer’s so-called “product experience” 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 are essential. A PIM system is necessary always to 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 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 when product information is fragmented andunlinkedd in different places. This also includes information in accounting programs and warehouse management systems if that applies to you (and otherwise to the supplier).
The consistency in the product data you distribute to your channels is just as important. We are talking about product descriptions, photos, prices, discounts, stocks, and suggestions for related products.
Uniform Customer Experience
Naturally, this leads to a massive advantage for the customer experience: it is uniform. Losing a customer by not having your product data up-to-date is a shame. 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 afterwards because the product is out of stock.
You also want to tell the same story everywhere. Therefore, consider your product data as a basic 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 more open data.
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 good options for your marketing data.
The need for enriching content also makes a massive difference per product type. A PIM system also offers better support for this. And you can efficiently distribute that enriched data to all channels: your e-commerce environment, app, store, or marketplaces. This way, you are assured that the customer experience is consistent.
Integration With Your E-Commerce System
It speaks for itself: you can integrate modern PIM systems seamlessly with your e-commerce environment. A link with, for example, Magento 2 is 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 most 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 specific characteristics of this product. It is more important than ever to help consumers find the product they want. It is not without reason that the search and filter options on web shops are used so often. With the correct taxonomy, you organize your products so efficiently that comparable products can be displayed as a recommendation to the consumer based on the correct product data.
A full-fledged PIM system enables efficient taxonomy and management. This allows you to manage your product groups and categories from one location and ensure that they are distributed across all your channels logically and consistently.
A PIM system ensures more efficient communication between suppliers, sellers 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 time-to-market can often shrink considerably.
Lower Costs Per Product
Time-to-market results from 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 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 store and manage product data centrally. This does not always include content such as digital media – especially if these are larger files such as longer texts, product videos or other more significant assets. The distribution of this digital content to the proper channels and in the right ways is usually a bit more complex than, for example, overshooting product specifications, prices, and stocks.
Limited E-Commerce Analyzes
A PIM system is not ideal for analyzing sales figures and marketing performance at the product level. Also, the systems are usually not so intelligent that advice can be made for changes in any product data.
PIM Versus Other Solutions
A PIM system is an excellent addition to your current e-commerce tech stack. However, the term is often confused with other solutions and systems. It is essential to know that, in principle, a PIM can never be replaced by other systems, as with many e-commerce solutions and modules.
Time to put the essential 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, essentially automate them.
As you can 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.
A PIM is usually seen as a 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 compared with a PIM.
A PCM is 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, etc.
A PIM system does the same thing, with three significant additions:
- Collection & connection: collections of product data are collected in one place and connected.
- 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 most significant 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 going on throughout the product’s entire life cycle. At the same time, e-commerce specialists and marketers can mainly use information. Logically, the information collected and stored in PIMs is primarily based on product data. Because PDMs are also talking about the processes during the life cycle of a product, many PDM modules also exist within ERPs. However, these modules can hardly convert that data into valuable information.
You could, therefore, see PIM as an extension of PDM, which you need to further market 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. All departments use a PLM to manage the product lifecycle. Think of engineering, logistics, sales, purchasing, etc.
In a PLM, it is often also about time, such as project management during the production process and time registration. These events occur before data can be shot to a PDM, providing a PIM with information. A PLM is, therefore, one of the power sources of a PIM.
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 essential 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 essential part of this is the cooperation with suppliers and customers, in which a PIM system also plays an important role. In this case, both are an excellent and increasingly necessary addition to an ERP system.
So the significant 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 that a DAM manages all an organisation’s digital assets, 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 integral part of it. In your DAM, you mainly store product images and the like and additional images for marketing purposes. But the system has to interfere less with sales data, shipping information, and the like. That kind of process has to happen within the PIM system.
A PIM system provides the DAM system with product assets like images and videos. The system also ensures that these assets remain up-to-date and that new product images are delivered if something changes.
How does PIM work?
In terms of operation, a PIM system has three crucial, overarching functions that continuously follow each other in the cycle:
- Collect data
- Enriching data and converting it into valuable information
- To spread information
- So you see 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.
Data Sources Linked to a 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 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 crucial to your sales as your product lifecycle, which is “monitored” by your PIM.
Data Management System (DAM/DMS)
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 your PIM system’s more critical power sources. In the meantime, it also works the other way around. If the PIM system notices that a particular asset has been replaced or removed, this information should be immediately transferred to the data management system.
Flat files. Unfortunately, many e-commerce companies still use “flat” files that live somewhere on a server or locally, 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 PLM. The type of management systems that focus more on your products’ content, data and life cycle also serves as a power source 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 many data sources can be linked to a PIM system. What this system also does is define and clean data.
Data Enrichment and Conversion in the PIM System
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 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 essential 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 extracted from your ERP and CRM.
Taxonomy and Classification. One of the additional benefits of a PIM system is the taxonomy of products, which makes it easier to create product categories and hierarchies. That’s what is being done here. This happens later to make it easier for the end customer to find the product they seek.
Manage the life cycle. A PIM system allows you 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. As a user, you 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 simultaneously ensure automated distribution to all your channels, make real-time changes, and connect it to all your e-commerce platforms, marketplaces, and other channels.
Manage multiple sales channels. You push all up-to-date and consistent product information from your PIM to your main e-commerce channel, often your webshop. However, consider POS systems in physical stores, marketplaces, marketing channels such as Google Ads and Facebook, mobile applications, social channels, etc.
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 catalogues 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 several years. It is good to know that many systems offer more 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. This depends on the entire e-commerce organization, your objectives, available resources, etc.