Managing product information is crucial for any ecommerce business, but it’s especially important for multi-vendor marketplaces.
One of the benefits of multi-vendor marketplaces is the ability to significantly expand your inventory with less risk — often leading to a higher volume of products than first-party commerce. For example, Amazon Business, Amazon’s B2B marketplace, has more than 150,000 unique sellers, each with their own catalog.
Since third-party sellers are uploading their own products, data can get out of control.
Keeping product information relevant, up-to-date, and consistent is critical because it has a significant impact on the buyer’s experience and, in turn, purchase decisions. To provide a seamless shopping experience for buyers, the products they need must be easily searchable, with comprehensive information available. Without the right product data, this is nearly impossible to achieve.
Of course, at such a large scale — and with many different sellers involved — managing product information can seem overwhelming. Worse yet, mistakes can snowball and prove incredibly costly. Poor data costs companies $15 million annually on average. If data quality erodes through mismanagement over time, so does the customer experience and, consequently, your organization’s sales.
So how can a marketplace operator ensure they’re keeping on top of product information management? That’s where a PIM system is critical.
This article will answer the following questions:
PIM is short for product information management. Consider a PIM as the single source of truth for product data for your entire catalog. A PIM system or tool brings together every type of data related to your catalog — from product descriptions and SKUs to digital documents such as product images or PDFs — into one centralized location.
Using a PIM improves the buyer's experience — they can easily access the information they need and find the products they're looking for in a format that allows easy comparisons. That positive experience continues with every contact they have with your marketplace since all your teams are on the same page, whether it’s marketing, accounting, customer service, or anything in between.
The first PIM systems appeared in the 1990s and were basically repositories for digitized content used to produce paper catalogs. Today, they are much more sophisticated software solutions that harness technologies like automation and the cloud to manage catalogs so large that they would’ve been unimaginable just a few decades ago.
Overall, a PIM ecommerce system has four main functions:
B2B products often have more complex data than B2C. For example, if you’re a car mechanic looking to buy brakes, there’s a lot of information you need to understand if the product is the right fit. Unlike buying a tshirt, it’s not as simple as color and size. You need to understand the material, exact diameter, thickness, weight, etc.
Now add in third-party sellers to the equation. These sellers are each a product information source onto themselves, and each may use different data formats and attributes.
With the complexities of B2B commerce and third-party sellers uploading their own data, it’s easy to see how product information can get unruly if there’s no overarching system in place. Therefore, a PIM is an important B2B marketplace feature to consider.
An excellent user experience is what keeps customers coming back to a marketplace. A PIM is fundamental to providing buyers with the best possible shopping experience. Here are the four main benefits of a PIM ecommerce tool:
Few things frustrate buyers more than discovering a product that appears available is not. Thanks to real-time updates, a PIM ensures that buyers will only see up-to-the-minute inventory levels. Marketplace operators can also easily manage substitutions to suggest replacements for unavailable products.
Enriched product descriptions make it easier for buyers to find exactly what they’re looking for. Plus, with the right data, products are correctly categorized, so they show up in the right search results.
Product information in a PIM must meet a well-defined structure for integration and compatibility. Accuracy and consistency help build trust for your marketplace among buyers, who will appreciate reliable product information.
A PIM automates many manual data processes, so your team can spend more time focusing on growing the marketplace and its catalog to meet evolving buyer needs. Additionally, with the right data model set up, your sellers will be guided to input the right product information that's consistent with sellers across your website.
It’s also easier to quickly expand your catalog if all product information criteria are already established with a PIM. The PIM pulls data from a variety of sources so you don’t have to manually enter information more than once — leading to decreased risk of human error. Note: You'll still want to regularly conduct data audits to ensure accuracy.
Clearly, many businesses realize a PIM system’s high value, and the shift to online sales during the pandemic has only made the software more in demand in recent years. In 2019, the product information management market was worth $9.9 billion, but it’s expected to reach a whopping $59.25 billion by 2027.
But with so many options on the market, how do you decide which is right for your marketplace? When selecting a PIM to improve your ecommerce function, you need to consider three key questions.
Implementing the right PIM has numerous benefits for a marketplace operator — as well as their buyers and sellers.
For one, marketplace operators save time. They also build trust as the overall quality of their product listings improves.
These enriched listings will attract more buyers, who are looking for a frictionless buying experience and want to find what they’re looking for as soon as possible. Sellers, of course, will see positive impacts in terms of revenue, and more B2B businesses may be inclined to participate in the marketplace as a result.
Ultimately, a PIM helps remove the friction to buy and the friction to sell, which are two fundamental keys to a marketplace’s success.
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