Introduction

Very few PIM providers have transparent price policy and openly reveal what their solution will really cost on their websites. Therefore while many companies rarely acquire new software, decision-makers often lack experience in determining the real PIM costs and uncovering all hidden cost blocks.  This article will give you a comprehensive understanding of the costs involved in implementing a PIM system, potential hidden charges, and compare the pricing of popular PIM solutions. The costs incurred when introducing PIM can be divided into 2 large cost blocks:

• One-time costs
  • conception costs
  • evaluation costs
  • setup costs
  • costs for acquiring the licenses
  • Implementation costs
• Ongoing costs
  • license costs
  • hosting costs
  • maintenance and support costs
  • further development costs.

Let's break down each of these costs blocks:

One-time PIM Investments

As the name suggests, one-time investments arise only once and include two cost blocks: implementation costs and license acquisition costs.

Since there are over 100 PIM providers, choosing the right one is not always easy. Therefore, companies often bring in PIM consultants to assist in choosing a suitable PIM system and/or the service provider responsible for implementing it. The costs for PIM consultants alone can reach EUR 10,000.

Conception costs

In the pre-project phase, you have to decide what you want to achieve with the PIM system, which problems need to be solved, and which business processes must be optimized. To set your priorities straight, you should do the following:

• Determine who the PIM users are – who should use the system in the future.
• Determine the scope of data – which data should be managed in the system.
• Determine business processes – what should the system be used for?
• Determine technological framework conditions – which technologies you require, whether it should be a SaaS, open-source, or on-premise solution

You will only face costs for concept creation if an external PIM consultant is involved. Bringing a consultant in is optional and we recommend you decide on that based on your priorities and available budget. 

Consider attending workshops on the subject. The cost of a 2-day workshop usually starts at EUR 2,000.

Evaluation costs

To choose the right providers, draw up a shortlist and prepare a catalog of questions for the conception phase. All providers on the shortlist should then complete the questionnaire and return it. Evaluate the answers and invite the best 2-4 providers to a personal presentation of their solution.

This phase is also often led by PIM consultants and can, therefore, entail additional costs. An evaluation will typically cost anything from EUR 4,000 because a PIM consultant is usually present at all presentations to evaluate specific system requirements more precisely and to form a professional opinion.

Setup costs

Setup costs are the price for the initial installation of the system. These can vary greatly from one provider to the next. The costs for configuring the system may also fall under setup costs.

License costs

The expenses associated with licenses can occur either as a one-time payment or on an ongoing basis. There are two types of licenses:

• Rental licenses – allow you to use the software only for a certain period of time.
• Purchase licenses – allow you to use the software permanently.

The cost of purchasing licenses is incurred just once. If you acquire rental licenses you will pay a regular monthly or annual fee.

One should note, however, that the purchased licenses do not automatically include the right to software updates and upgrades and may restrict them. Sometimes the updates and upgrades are only granted if the user concludes a maintenance and support contract. You should, therefore, investigate very carefully which software licenses are involved and how the updates and upgrades are handled.

The license prices can depend on the following factors:

• Number of users
• Number of SKUs
• Number of supported languages
• Number of required software modules
• Number of output channels

Implementation costs

The expenses for implementing the selected PIM software often form the largest cost category. The effort largely depends on the individual requirements of the user, particularly for e-commerce, where the requirements for integration with online shops and marketplaces can create a significant cost pool. Here are some typical cost drivers:

The costs will be incurred here for:

• establishment of the roles in the system
• data migration from existing systems
• integration with other systems – e.g. ERP, marketplaces, online shops
• setup/programming of workflows
• adaptation of existing features
• programming of the new functionalities
• employee training
• system launch.

You should make an effort to estimate these expenses as precisely as possible in advance. Constantly monitor the prices to stay on track. If there are no special requirements, the providers who offer standard PIM software may prove to be the cheapest.

Even if open-source solutions are free, they also incur implementation costs. If the wrong solution is chosen, the cost of implementing that solution may outweigh the cost of acquiring licenses and introducing some other solution.

Ongoing costs

Ongoing costs are regularly incurred. These costs vary widely between providers, therefore, never underestimate them and always make sure to clarify them in advance.

License Prices

The costs for rental licenses or updating the purchase licenses so that you can get software updates and upgrades are incurred regularly and can vary greatly. Take into account that certain software modules are often licensed and paid for separately.

Maintenance and support costs

The software does not work on its own over the long term. It must be maintained. Nobody can do this better than the software providers themselves. After the implementation phase, you should conclude a maintenance and support contract with the provider or one of their partners. Often there is even an obligation to do so according to the license conditions. The prices for this can depend very much on the following factors:

• how quickly you react
• how many support hours you require per month
• whether developer support is necessary
• which communication channels are available
• whether you want a permanent contact person
• which service levels must be adhered to.

Some Pim providers offer a few support packages that differ in terms of prices and services provided. Usually, the maintenance and support fees are related to the license costs

Further Development Costs

No matter how good the conception of your PIM solution is, it should be further developed because the way you use the software will change over time. Certain functions will be adapted, others will be added. Further development is often invoiced at the usual daily rates. A functionality can take one working day in one piece of software, and five in another. You should, therefore, choose software that is flexible and easy to customize.

Hosting costs

All PIM software has to be hosted somewhere. It can be installed in your own data center, on rented server infrastructure, or in a private or public cloud. The cost of hosting will also depend on this decision. There are also different requirements for PIM software that must be taken into account. If a single server is often sufficient for web-based solutions, enterprise on-premise solutions may need several servers to run.

Revealing the Hidden Costs in PIM Solutions

1. Integrating your PIM with other systems might entail some extra charges. These are linking or connector fees, a separate part of your budget preparations.
2. The complexity of configuring the PIM system can also become a source of hidden costs. As configurations become more intricate, companies might face unexpected charges linked to the intricacy of the setup process.
3. Adjusting workflows also leads to more costs which are not apparent in advance
4. PIM packages are not all the same. Some software providers offer all-inclusive packages, while others charge extra fees for additional functionality.

To fully avoid or minimize the hidden costs mentioned above:

1. Do an in-depth review of your organization's needs and identify the priority features you require. This first step paves the way for wise decision-making.
2. Clarifying your needs and forthcoming costs with your PIM provider and discuss the pricing details.
3. During the setup phase, ensure that all aspects of the initial configuration, including database setup and system initialization, are clearly defined.
4. Check the PIM package you selected and make sure it includes all the features you need.
5. Scrutinize vendor contracts thoroughly. Carefully review the suppliers' agreements. Be mindful of sections on extra charges, support costs, and ongoing maintenance. Understand the terms of service to avoid post-implementation surprises.
6. Look for customer feedback and check out opinions on PIM providers. Insights from organizations with similar needs can provide valuable information about potential hidden costs. The resources like Capterra and G2 mind provide you with helpful insights.
7. Before going all in, consider engaging in pilot programs. This lets you check the PIM solution in a managed setting. This gives you a chance to test the PIM solution in a controlled environment and learn about potential challenges and associated costs.

Factors Influencing PIM Costs

The financial investment across the stages mentioned above is significantly influenced by various factors tailored to your specific business needs. These key determinants include:

• Company Type: The size, structure, and operational scale of your organization play a pivotal role in shaping the overall PIM requirements and costs.
• Business Area: The nature of your industry and specific business domain introduces nuances that impact the complexity and scope of your PIM implementation.
• Content Type: The diversity of content managed by your PIM system, such as images, videos, and detailed product descriptions, can influence the sophistication of the PIM solution required, consequently affecting costs.
• Number of SKUs: The volume of products or services your business offers, often measured by the number of Stock Keeping Units (SKUs), can influence both the implementation and ongoing costs of your PIM system.
• Data Input and Output Sources: The intricacy of integrating various data sources, including input channels and output destinations, adds a layer of complexity to your PIM implementation. This complexity can contribute to increased costs based on the number and diversity of these sources.

PIM Systems Cost Compared

There are very few PIM providers who publicly publish the prices for their solutions on their websites. In part, it is related to the amount of competition. If prices are not publicly available, there is leeway for price negotiations.

Table 2. Cost of popular PIM systems.

Final thoughts

Selecting a Product Information Management System (PIM) involves understanding its Total Cost of Ownership (TCO). This encompasses one-time costs (conception, evaluation, setup, license acquisition, implementation) and ongoing costs (license, maintenance, hosting). Hidden costs may arise from integration, configuration complexity, workflow adjustments, and package differences. Influencing factors include company type, business area, content type, number of SKUs, and data sources. A cost breakdown and system comparison aid in making informed decisions for a PIM solution's long-term success.