Consumer & Insights
For the past couple of years, we’ve all read projections that the classic retail will come to an end. In fact, by 2021, online shops will account for 17,5% of the total global retail sales while brick-and-mortar businesses will still stand strong at 82,5%. So we shouldn’t read too much into those projections just yet.
However, while retail eCommerce sales have followed a growth trajectory every year, the rate of growth itself has been slightly decreasing annually. According to some statistics, the growth rates for 2019, 2020, and 2021 are projected to be 21,5%, 19,8%, and 18%, respectively. Overall, the total industry growth is astonishing. Moreover, global eCommerce sales will hit $4,88 trillion in 2021—a whopping 246% increase in online revenue from 2014.
With respect to how eCommerce is doing by region, China is the largest market in the world with almost double the sales in the US in 2018. The UK ranks first in Europe and comes third in the overall eCommerce market. Based on current trends, nearly all commerce is likely to move online within the next 20 years. And most of the online sales will be driven by mobile devices. If companies want to keep a competitive edge in the economy of tomorrow, they need to ramp up their mobile-first strategies.
Is omnichannel the Grand Solution or just a buzzword?
Streamlining the user experience across all platforms is vital for any eCommerce business. Omnichannel remains one of the last frontiers of digital marketing and that’s partly down to the continued growth in channels.
Adopting an omnichannel strategy—unifying multiple channels to create a seamless customer experience—is a major investment. These costs can be anything from IT infrastructure to AI tools and even in-store sensors that track customer behavior.
So does omnichannel really pay off?
The short answer is ‘yes’. With benefits ranging from smarter marketing to massive savings in the warehouse and logistics, omnichannel is indeed the future of eCommerce. But mainly, the investment pays off because consumers are asking for this experience — even though most of them don’t know it’s called omnichannel.
There is a downside as well, besides fragmentation, which is not that obvious. Omnichannel is an approach that puts marketing before the back-end. Attempting to unite channels without properly setting up and maintaining inventory and order management could be counterproductive.
By looking at the market pulse, it seems that every retailer has adopted some form of an omnichannel strategy. But only a minority approaches it from a tech perspective and even fewer demonstrate a holistic, experience-first mindset. The competitive edge will come from delivering valuable experiences throughout the customer journey.
PIM is the nervous system of your distribution channels
Fortunately, Product Information Management platforms (PIM software for short) can help you better manage your central set of product data and stay organized – no matter how many SKUs.
A Product Information Management system is a tool used by businesses to store and manage all product information across multiple channels from a unified dashboard. A strong PIM solution centralizes and syncs product data across your entire technology stack, allowing back-office and marketing teams to manage, merchandise, and market everywhere customers shop.
It syncs, feeds, and receives product data into every component of a commerce technology stack (e.g., eCommerce software, RP, OMS – order management system, third-party integration, etc.) empowering each department to function efficiently no matter their preferred business application. It is the ideal tool for cross-functional teams in eCommerce.
For instance, the back office will be able to effortlessly manage every product detail (e.g., item numbers, catalogs, SKUs, images, currencies, custom attributes, etc.) in one place. Your marketing teams can create custom landing pages, launch promotional banners, schedule highly targeted campaigns on multiple marketplaces, and easily support localized or international websites.
Start with ERP, continue with PIM
A PIM actually works as a central nervous system. Your entire organization will become aligned around a single set of product data, back-end workflows can be refined, and you can finally reduce the time and effort spent meeting the demands of the dynamic omnichannel shopping experience. What it actually does is optimize your enterprise not just for surviving the current challenges but for thriving in the long run, too.
Your teams can easily upload, edit, and distribute product-level data across all of today’s major sales and distribution channels — from Amazon to Google Shopping, to your eCommerce website and beyond.
The most frequent use case for a solid PIM solution is when brands are working to expand globally by supporting multiple geographic locations, languages, currencies, and marketplaces. Also, businesses that have a limited number of products with a high set of variables and custom options are in need of the system. Companies that have the forethought to future-proof their technology stack before workflows become an issue and impact their ability to scale can also benefit from PIM solutions.
But before PIM, start with ERP (Enterprise Resource Planning). This system is used to manage multiple key functions of your business, such as inventory and order management, purchase order and supplier management warehouse and logistics, accounting, CRM (including its most agile form as Salesforce Service Cloud and Marketing Cloud), and some marketing functions. It’s the heart of your company.
When particularly considering the product and inventory management aspect, ERP will contain much more detailed information than your eCommerce system. You can gain real-time and data-driven insights into every aspect of your business:
- inventory availability across channels and within multiple warehouse locations
- recommended retail prices as well as vendor and discount prices
- landed costs for products shipped from overseas
- inventory availability for bundles, kits, and assemblies
- inventory asset values and more
Look at it as an ecosystem!
Your eCommerce business is the body and ERP is its heart. And now comes the nervous system, the Product Information Management (PIM), which needs to seamlessly integrate with the ERP to provide even further insights into your product data. Merchandising and marketing information, product images, videos, and SEO data — all need to be managed by a PIM system specialist.
These are signs you need PIM
We know — the amount of change and options in this sector can be daunting. This is what prevents brands from scaling up to more than anything else. Don’t get discouraged — evolution is part of doing business.
At some point even the smallest hiccup in operational workflows will mean your competition will get an edge on the market, conversion rates will suffer, and your customers will be unsatisfied.
Here are a few signs your company needs to revisit its technology stack and evaluate a PIM solution:
- difficulty in keeping data consistent from each of your suppliers
- difficulty in maintaining ERP, Order Management System, and PIM
- spending too much time updating inventory and product imagery across each storefront and sales channel
- no control of online product releases
- difficulty in managing a large product catalog across multiple channels
- no tool that can help you easily scale internationally to provide personal shopping experiences (e.g., products, regions, languages, and currency
If you’re not sure where to start when evaluating a Product Information Management solution, start with your eCommerce service provider or an agency. They know your business well and will do their best to steer you in the right direction.
You can survive or you can choose to stay competitive
Not only do PIM systems make data collection virtually effortless, but they also increase productivity among your departments by automating manual data processes, pushing products through different channels, and sharing information quickly between cross-functional teams. With a PIM system, your sales team can now work independently of your product development team and vice versa, making everyone’s job easier in the long run.
So, eCommerce platforms combined with ERP and PIM ensure you can streamline and automate more of the processes within your business. It saves you from headaches when it comes to managing lots of product information and data. All these by keeping the customer-centric position of your business, the actual cornerstone of your growth.
Need more information about PIM solutions or wish to speak to us? Drop us a line and we’ll get in touch.