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What's PIM, and how does it work?
A PIM system, an abbreviation of "product information management system", is software used for the centralized management of product information in real-time. Within a PIM system, product data comply with specified standards and formats. These data are unique, detailed and complete.
PIM systems work in the following way:
- PIM is a uniform product database that is filled with product information from various sources (ERP, Excel, PLM, etc.) The product information can be entered by employees who are related to the products at all stages of their life cycle.
- The collected information is structured automatically or manually, divided into categories, enriched and completed, translated into different languages and enriched with corresponding materials.
- After its creation, high-quality product information can be published on various channels: print catalogs, market places (like Amazon or Ebay), online shops, mobile applications, etc.
The main task of a PIM system is, therefore, working not with the product, but with the product information. This means that PIM software offers good product support throughout the product life cycle.
A PIM vs PLM system
Product Life Cycle Management software (PLM) is used for the processes involved in products’ development, release, and service. PLM systems are, however, not intended for marketing.
PLM allows users to:
- author and manage product requirements,
- analyze product portfolios,
- manage product development projects and engineering changes,
- collaborate on design, etc.
PIM allows users to:
- collect and consolidate data,
- structure, augment and extend data,
- publish data to the web and print.
While a PLM system is necessary for engineering and production processes, and to deliver information to outsourced manufacturing and supply chain partners. PIM acts as a source of product information to distributors, wholesalers, and customers. It facilitates every stage of the product life cycle. These systems work best in combination.
Product development life cycle stage
During the product development phase, it's necessary to work on high-quality product descriptions, to avoid wasting time when the product is ready for market introduction. Swift development and market launch of new products (NPI – New Product Introduction) create a great competitive advantage for manufacturers. And this is where a PIM can help. A PIM System saves time in the preparation of high-quality product descriptions and their translation. In a PIM, all the data required for the introduction of the products are stored in a single location. In addition, all important information created during product development, such as drawings, 3D models, photos of prototypes, etc., can be stored in the PIM system as in a repository.
Product introduction life cycle stage
During the launch of the product, information must be distributed through all possible channels at the same time – in print catalogs, on the websites of wholesalers, on portals, in online shops (your own and those of your partners), web applications, etc. A PIM system will help to publish unified information on all channels. It also allows for an increase in the number of channels with no increase in maintenance costs. After connecting the sales channels to a PIM system, the system will synchronize and update the product information quickly and easily. Thus, the correction of errors will be faster and more efficient than without a PIM solution.
Product growth life cycle stage
Practice shows that large companies that have implemented a PIM system, have increased sales by 25% annually. This is because you can easily connect and maintain new distribution channels to the PIM system. Manufacturers using a PIM system can produce more complete and accurate product information than without it. Also, PIM allows for quick and easy updates of product descriptions published across all channels. When you add a new flavor, color, or any other variation of a product, PIM ensures that the changes are made public in no time.
Product maturity life cycle stage
The information about products, promotional offers, discounts and bonus programs should be complete, usable, accurate and delivered on time. This supports a positive brand image and increases loyalty. At this stage, the quality of the product descriptions can be critical to the buying decision. In a competitive environment, this criterion becomes particularly important.
Saturation life cycle stage
At this point, the relevant product information is a must-have because, without it, the sales can drop faster than ever. All the innovations, improvements, and price changes must be communicated efficiently. The changes can be frequent, and a PIM system will help to deliver updates timeously.
Product decline life cycle stage
As an example, consider Procter & Gamble and Walmart. After the introduction of PIM software in these companies, the system showed that 3.7 % and 2.5 % of the outdated products in the catalogs of these companies were not being sold. With a PIM system, a company can keep its product range up-to-date and maintain product catalogs. It can also use large amounts of product information collected for the following:
- searching for consumer patterns;
- increasing the effectiveness of sales;
- generating ideas for a new product.
Summary
To predict sales and the behavior of consumers, marketers use the concept of the product life cycle. The 6 stages of the product life cycle differ by audience, sales, pricing, and profitability. Using this model, marketers can develop an optimal strategy that maximizes profit. Since the product information is as important as the product itself for this purpose, using PIM software to improve this data and timeously publish updates is very beneficial. From the product development to its decline, a PIM system helps to support the sales with accurate and detailed information.
