Category Archives: PiM
Arkady, you recently came back from the National Retail Federation conference. What are some of the issues that retailers are struggling with these days?
Arkady Kleyner: There are some interesting trends happening right now in retail. Amazon’s presence is creating a lot of disruption which is pushing traditional retailers to modernize their customer experience strategies. For example, most Brick and Mortar retailers have a web presence, but they’re realizing that web presence can’t just be a second arm to their business. To succeed, they need to integrate their web presence with their stores in a very intimate way. To make that happen, they really have to peel back the onion down to the fundamentals of how product data is shared and managed.
In the good old days, Brick and Mortar retailers could live with a somewhat disconnected product catalog, because they were always ultimately picking from physical goods. However in an integrated Web and Brick & Mortar environment, retailers must be far more accurate in their product catalog. The customers entire product selection process may happen on-line but then picked up at the store. So you can see where retailers need to be far more disciplined with their product data. This is really where a Product Information Management tool is critical, with so many SKUs to manage, retailers really need a process that makes sense from end to end for onboarding and communicating a product to the customer. And that is at the foundation of building an integrated customer experience.
In times of the digital customer, being online and connected always, we announced “commerce relevancy” as the next era of omnichannel and tailoring sales and marketing better to customers. What information are you seeing to be important when creating better customer shopping experience?
Arkady Kleyner:This is another paradigm in the integrated customer experience that retailers are trying to get their heads around. To appreciate how involved this is, just consider what a company like Amazon is doing. They have millions of customers and millions of products and thousands of partners. It’s literally a many to many to many relationship. And this is why Amazon is eating everybody alive. They know what products their customers like, they know how to reach those customers with those products, and they make it easy to buy it when you do. This isn’t something that Amazon created over night, but the requirements are no different for the rest of retailers. They need to ramp up the same type of capacity and reach. For example if I sell jewelry I may be selling it on my own company store but I may also have 5 other partnering sites including Amazon. Additionally, I may be using a dozen different advertising methods to drive demand. Now multiply that times the number of jewelry products I sell and you have a massive hairball of complexity. This is what we mean when we say that retailers need to be far more disciplined with their product data. Having a Product Information Management process that spans the onboarding of products all the way through to the digital communication of those products is critical to a retailer staying relevant.
In which businesses do you see the need for more efficient product catalog management and channel convergence?
Arkady Kleyner: There is a huge opportunity out there for the existing Brick & Mortar retailers that embrace an integrated customer experience. Amazon is not the de facto winner. We see a future where the store near you actually IS the online store. But to make that happen, Brick and Mortar retailers need to take a serious step back and treat their product data with the same reverence as they treat the product itself. This means a well-managed process for onboarding, de-duping, and categorizing their product catalog, because all the customer marketing efforts are ultimately an extension of that catalog.
Which performance indicators are important? How can retailers profit from it?
Arkady Kleyner: There are two layers of performance indicators that are important. The first is Operational Intelligence. This is the intelligence that determines what product should be shown to who. This is all based on customer profiling of purchase history. The second is Strategic Intelligence. This type of intelligence is the kind the helps you make overarching decisions on things like
-Maximizing the product margin by analyzing shipping and warehousing options
-Understanding product performance by demographics and regions
-Providing Flash Reports for Sales and Marketing
Which tools are needed to streamline product introduction but also achieve sales numbers?
Arkady Kleyner: Informatica is one of the few vendors that cares about data the same way retailers care about their products. So if you’re a retailer, you really need to treat your product data with the same reverence as your physical products then you need to consider leveraging Informatica as a partner. Their platform for managing product data is designed to encapsulate the entire process of onboarding, de-duping, categorizing, and syndicating product data. Additionally Informatica PIM provides a platform for managing all the digital media assets so Marketing teams are able to focus on the strategy rather than tactics. We’ve also worked with Informatica’s data integration products to bring the performance data from the Point of Sale systems for both Strategic and Tactical uses. On the tactical side we’ve used this to integrate inventories between Web and Brick & Mortar so customers can have an integrated experience. On the strategic side we’ve integrated Warehouse Management Systems with Labor Cost tracking systems to provide a 360 degree view of the product costing including shipping and storage to drive a higher per unit margins.
You can hear more from Arkady in our webinar “The Streamlined SKU: Using Analytics for Quick Product Introductions” on Tuesday, March 4, 2014.
Inspired by the fact I was coming home from a business trip on Valentine’s Day.
Money makes the world go round
In the UK Valentine’s Day ranks behind Halloween, Mother’s Day, Easter and Christmas. British men spend 622m GBP, while women spend 354m. But the average purchase is 119 GBP. Germans for example only spend 59 GBP per person. According to a survey 53 per cent of US women will dump their boyfriends who do not give them anything on this day. China invented the singles day, where 3.5b GBP have been spend in 2013. A lot Americans spend money for pet gifts generating 227m of sales on Valentine’s Day.
All you need is love?
No, all you need is the right product to sell. Retailers use a wide range of an eclectic product to sell around this day, ranging from flowers to insurance and ecigaretts. IKEA Australia made furniture relevant for love with offering a free purchase for every child born nine months from Valentine’s Day.
What GfK and Google research say
In February Google searches showed a peak for recipes and poems. According to GfK, 81 per cent are using coupons when doing the purchase for Valentine.
Where and what to shop
Supermarkets have wrapped up to be the one-stop shop for lovers in a rush. Sainsbury reports a 12 per cent growth in sales of condoms. But did you know the top 8 gift ranking?
1. Cards and eCards
3. Romantic dinners at restaurants
4. Romantic dinners at home (a condom and candles could be the perfect cross-sell to the wine and the recipe – or you plan to get pay-back from IKEA as mentioned above )
6. Jewel leery
8. Weekends away
Sorry, but I will note tell you what I bring home for my wife. But did you know Informatica World offers a retail path this year? Long tail, ecommerce, from retail to me-tail, supply chain optimization and customer centricity and interesting company speakers are on the agenda.
Our blog frequently provides best practice stories of our customers using product information management (PIM) for their business model. This case is about the “long tail strategy” at Kramp.
Tines, hand tools, spare parts for agricultural machines and hydraulic motors are the order of the day at Kramp. Kramp, based in the Netherlands, is Europe’s largest wholesaler of accessories and spare parts for motorized equipment, agricultural and construction machines. The company’s business model and e-commerce strategy is exemplary. Kramp is using product information management (PIM) for their long tail strategy in e-commerce.
Kramp’s Value Proposition: “It’s that easy”
“We want to make it easier for our customers, partners and suppliers. We believe in the future and the power of e-commerce”, said CEO Eddie Perdok. Kramp grew the product assortment from about 200,000 to 1,000,000+ items from about 2,000 suppliers.
Previous stock policies in mail order retail always meant having limited space. In the catalog there were only a certain number of pages available. Even the logistics were limited – warehouse storage limited the possibilities so much that the majority of companies tried to find the “perfect catalog range” with the largest number of bestsellers.
The Digital Assortment Has No Limits
“Compared to other sales channels, the internet gives us significant cost advantages”, says Eddie Perdok. The digital department store consists of servers that can be easily extended at any time.
Adding a new product requires no more than a few additional entries in a database. The challenge is that the product data must be obtained from the suppliers and then distributed before products can be presented in a shop. The range is therefore often limited because the product data cannot be efficiently updated and sale is lost to other vendors are retailers.
Europe’s largest wholesaler of spare parts for agricultural machines and accessories focuses on managing all product data from a central data source for all sales channels and languages.
Customer and supplier feedback is an important factor
“We want to bring customer opinion and supplier knowledge together”, explains Eddie Perdock. “Online customer evaluation combined with the knowledge of the manufacturer puts us in the position of being able to optimally control our stock”. In e-commerce, vendors, retailers and customers are coming closer and closer together.
Benefits Kramp realized with PIM on their long tail strategy
- Quick ROI due to short implementation phases
- Better customer satisfaction due to optimal data quality
- Higher margins and turnover in e-commerce due to niche items in long tail
- Easy, professional handling of mass data lowers process costs
- Short product introduction times to new markets
You can learn more on using PIM for long tail business on the entire case study or hear Ronald Renskers, Manager Product Content at Kramp, and others talking on the latest video.
Massively increasing the assortment is one of the top trends retailers and distributors focus on, according to Forrester Principal Analyst, Sucharita Mulpuru. Forrester’s research shows that retailers’ biggest competition are brands that sell directly to consumers. Marketplaces like Amazon result in higher margins, according to Forrester and www.pim-roi.com.
I was recently boarding a flight in New York and started reading the New York Times. One article jumped out: “User reviews make it harder for marketers to manipulate.” A Stanford University research report proves a wealth of product information and user reviews is causing a fundamental shift in how consumers make decisions.
Consumers rely more on one another
The latest research from Dr. Simonson and Emanual Rosen is based on an experiment performed decades ago at Duke University. In the experiment participants had to choose from a group of either two or three cameras. The research found that consumers chose the cheaper product when being offered two options, but when given three choices, most went with the middle one. It was called the “compromise effect,” which has been used by marketers to impact buying decisions.
But an updated version of the experiment allowed participants to read product ratings and reviews before choosing one of the three cameras. While a portion of the participants always choose the lowest-priced product, in this new scenario more participants are selecting the most expensive product over the middle-priced product based on customer reviews.
“The compromise effect is gone,” says Dr. Simonson in this New York Times article. The Book “Absolute Value” comes with a more in depth explanation: (http://www.absolutevaluebook.com/).
Imagine if you could own and control both customer opinion and product information? The next wave taking omnichannel commerce to the next level will address information relevancy at every channel and all customer interactions – called Commerce Relevancy.
The challenge for supermarkets today is balancing the needs of the customer against their ability to serve those needs. How are supermarkets and food manufacturers preparing their business for e-readiness? What about more customer centricity?
Currently, brands are not particularly good at serving consistent product information across in-store and online environments, leading to lower conversions and poor customer satisfaction. This shortfall is also preventing these brands from moving forward and innovating with new technologies. As a result, Product Information Management (PIM) is becoming a significant focus in effective omnichannel initiatives.
Consider the large range of products that can be seen at the average grocery store. The sheer number of categories is staggering, before you even consider the quantity of items in each category. There’s little wonder of local brands are struggling to replicate this level of product data anywhere else but on their store shelves.
Furthermore, consider the various kinds of information supermarkets are expected to include. Then, add to this the kinds of information supermarkets could include in order to present a competitive advantage over and above the rest. Information types currently possible are: Ingredients, additives, Images and videos, marketing copy, gene manipulation information, references, product seals, allergens, nutritional facts, translations, product categories, expiration/use-by dates, variants, region-specific information, GSDN information and more.
Ultimately, supermarkets are already on the path of improving consumers’ shopping experience and a few of the emerging technologies indicate the way this industry will continue to evolve.
6 Examples of food retail and supermarket trends
The below six examples demonstrate an emerging trend in grocery shopping, while also highlighting the need for accurate product information creation, curation and distribution.
- Ready-to-cook product bundles: Nice and very customer facing concept is done by German food retailer www.kochhaus.de (meaning house of cooking). The only offer product bundles of all ingredients which are required to cook a certain meal for the required number of guests. It can be seen as the look books which are well established at fashion brands and retailers sales strategy.
- Self-checkout Systems – More supermarkets are beginning to include self-checkouts. American and UK companies lead, Germany or Australia are behind. But there is the same risk of cart abandonment here as there is online, so providing a comprehensive and rich suite of product information at these POS systems is crucial.
- In-store Information Kiosks – Some supermarkets are beginning to include interactive displays in-store, with some even providing tablets mounted onto shopping trolleys. These displays serve in place of an in-store sales assistant, providing consumers with directions, promotions and complete access to product information (such as stock levels) on any item in the store.
- Supermarket Pop-ups – Food retailers are increasingly experimenting and improving the traditional shopping experience. One example that has turned the bricks-and-mortar concept on its head is electronic shopping ‘walls’, where products are prominently displayed in a high-traffic area. Consumers are able to access product details and make purchases by scanning a code presented alongside the image of a given product.
- Store-to-door Delivery Services – It’s starting to become commonplace. Not only are supermarkets offering same-day delivery services, the major brands are also experimenting with click and collect services. These supermarkets are moving toward websites that are just as busy and provide as much, if not more relevant content as their bricks-and-mortar outlets.
- App Commerce: Companies, like German food retailer Edeka offer an app for push marketing, or help matching customer profiles of dietary or allergy profiles with QR-code scanned products on the shopping list within the supermarket app.
What is next?
The supermarket of the future:
Reviving Customer Loyalty with leveraging information potential
Due to the increased transparency brought on by the ‘Google Era’, retailers have experienced a marked decline in customer loyalty. This concept of omnichannel shopping behaviour has led previously loyal customers to shop elsewhere.
Putting customers in the centre of all retail activities may not be a new trend, but in order to achieve it, retailers must foster more intelligent touch points. The supermarkets of the future will combine both product and customer data in such a way that every touch point presents a uniquely personalised experience for the customer, and a single, 360-degree view of the customer to the retailer.
The major supermarket brands already have comprehensive customer loyalty programs and they’re building on these with added products, such as consumer insurance packages. However, these initiatives haven’t necessarily led to an increase in loyalty.
Instead, the imperative to create a personal, intimate connection with consumers will eventually lead to a return in loyalty. The supermarket of the future will be able to send recipe and shopping list recommendations directly to the shopper’s preferred device, taking into account any allergies or delivery preferences.
Gamification as a tool for loyalty?
Moreover, this evolution will slowly lead into another phase of loyalty marketing: gamification. Comprehensive and detailed product data will form the basis of a loyalty program that includes targets, goals and rewards for loyal customers. The more comprehensive and engaging these shopping ‘games’ become, the more successful they will be from a marketing and loyalty perspective. However, the demands for detailed, accurate product information will also increase accordingly.
Private side note: My wife likes the simple Edaka App Game, where users need to cut slices of sausages. The challenge you need to hit exactly the weight the customer requires, like the in-store associate.
Those supermarkets that can deploy these initiatives first – and continue to innovate beyond this point – will have a bright future. Those that lag behind when it comes to leveraging their information and real time process might quickly begin to fade away.
What can I cook of my fridge remains?
I have been working all week long on the next year planning, so my fridge was not feeded well this week. Being almost empty the asks are
- What products are left?
- When do they expire?
- What can I cook of my fridge leftovers? (receipts)
- Where do I get the missing items for dinner with my wife? – And for which price
- Do they all match with my dietary and here allergy to nuts?
- Can I order online?
- When will they get delivered?
- What things can make our evening a success? The right wine recommendation? Two candles?
Well it is up to your imagination which products also can be sold in addition to make the customer happy and create a nice candle light dinner… But at least a good reason to increase the assortment.
How often are you getting emails with “your personal product recommendations”? How personalized and correct are they really? How relevant is your omnichannel information to your customers? Commerce Relevancy is the next wave putting Omnichannel Commerce on another level.
As Information gets more democratic, connecting the dots between master data of customers, supplier, location and products ring the bells for the next commerce wave after omnichannel commerce: It is Commerce Relevancy: In the first phase it is focusing and combining product and customer data to deliver consistency and relevancy in omnichannel retailing. That will have deep inpact in customer experience.
The evolution of the retail environment, driven by advances in technology, has taken us from single channel or siloed channels to omnichannel retailing. Customers expect to find product information and make purchases when it is most convenient to them. As a result, delivering the right product and brand information at every customer touch point has never been more important.
Consistent and accurate product information has a profound impact on the buying decision, but in this hyper-connected world where competitive information is at the customer’s fingertips, retailers and CPG manufacturers also need to ensure that the information provided is highly relevant in order to differentiate and stay ahead.
The market has passed the eras of siloed channels to multichannel commerce (serving all channels, but not allways connected, then connecting the channels, called cross channel commerce. The last wave was establishing the term of omnichannel commerce, due to Wikipedia described as “very similar to the evolution of, (Multi-channel retailing), but is concentrated more on a seamless approach to the consumer experience through all available shopping channels, i.e. mobile internet devices, computers, bricks-and-mortar, television, radio, direct mail, catalog and so on.”
The new generation of Commerce Relevancy requires the right information and data which help turning data into a competitive advantage by helping organizations present product information that is complete, accurate and easy to understand. In today’s retail environment data consistency is key, but it is no longer enough. Every retailer wants to be a success full online retailer and every manufacturer wants to become a retailer with several own direct sales channels.
The next wave taking omnichannel commerce to the next level will address information relevancy at every channel and all customer interactions – called Commerce Relevancy.
In order to enable Commerce Relevancy, companies are now asking themsleves how to connect the dots between supplier, location, customer and product information. In this business use cases customer profiles or target group personas get match with product inforomation in sales and marketing. Think of the same TV flatscreen sold to two completely different personas, but using other parts of the description to tailor it to the customer. Using other channels to promote it. Using other images and vidoes which match with the customer profile. Commerce Relevancy means connecting the dots between all master data and product information.
4 Elements of Commerce Relevancy
Relevance commerce is taking omnichannel commerce to the next level now. Commerce Relevancy is influenced by four main characters:
- Relevant product recommendations everywhere: what is the next logical buy? This will not only be leveraged in ecommerce but at any customer touch point.
- Relevant locations: the ways of a product from an own warehouse, from a supplier warehouse and brick and mortar become more flexible. Customers are being served always from the location nearby.
- Relevant marketing: personalization will reach a new level combining product, location, supplier and first of all customer information the right way and across all channels. Relations of and between data (like customer profiles and product bundles) build the core of customer experience, when delivered in real-time.
- Relevant analytics: As customers expect real time information and services new technologies come up to use eye mark recording or image recognition of customer faces when customers returning into a store. Measuring the heart frequency to understand customers’ emotions while shopping opens new possibilities, when connecting the data to unleash information potential.
How Do You Target Your Customers at All Channel Touch Points to Individualize Their Shopping Experience? 5 Ways to Personalize Your Product Recommendations
Traditional in-store merchandisers frequently engage in new and refreshing ways to improve the shopping experience for their customers. With thousands of square feet of space, accessorized mannequins, and attractive kiosks and showcase displays, they’re afforded numerous luxuries in creating environments conducive to driving sales.
Since online retailers lack these merchandising luxuries, they leverage entirely different tools to enhance the customer experience, using key components of web-based shopping, such as search, navigation, and product recommendations. In the world of e-commerce, we’ve moved from merely selling to customers to empowering them. As a result, e-commerce directors and online merchandisers need to optimize the process by delivering what their customers want.
And what do customers want? Apparently, they want it all: the price and ease of point-and-click purchasing, the experience of in-store visits, the convenience of home delivery, and the service of boutique shopping. They don’t think about product exposure. They don’t focus on the mechanics of the shopping process. And they don’t care about an e-tailer’s internal complexity. They want simply to buy what they need in a way that’s suited to them.
At the same time, because customers’ needs aren’t static, their online shopping experiences shouldn’t be either. They increasingly expect a personal and highly relevant interaction with the retail websites they visit. Failing to get that, they’ll often go elsewhere. For online retailers and brand manufacturers of consumer packed goods (CPG) this creates the challenge of customer retention.
Here are five hints to maximize the power of PIM for tailored product recommendations
To meet the challenge of customer retention demands leveraging product information management (PIM) to target your customers. This means customizing on-line shopping by boosting the relevance of product recommendations. To make the most of PIM, there are five things you should know:
1. To meet the expectations of your online customers, strive to understand them better by using data that’s qualitative and quantitative, historic and current; in addition, use data that provides a context critical to taking relevant actions.
2. To ensure that the experiences of your online customers aren’t static or boilerplate, make all key elements in the merchandising toolset intuitive and dynamic but, above all, tailored to the individual customer.
3. To leverage relevant content for other sales channels, consider the long-tail strategy and enhance the assortment. If customers dial in to the hotline, inside sales can leverage product search and automatic recommendations for intelligent cross- and up-selling within seconds. The hotline connects customer profiles and product information as well as availability on stock in your own warehouse or in the suppliers’ warehouse.
4. To present the best option to each customer, automate personalization of promotions and targeting. This means checking that every promotional banner that is presented has been optimized; banners that convert poorly must be automatically demoted and replaced by others that perform well. It’s all about automatic testing: Which campaign will convert best and which banner within that campaign—the blue, the red, or the one with a big arrow on it? Adopting an integrated approach ensures that a campaign will not be presented more than once on the same page. By using advanced techniques to understand which promotions appeal to each customer—and, more importantly, which don’t—the solution adapts in real time to present the most appealing banners in the context of each customer’s journey.
5. To ensure a cohesive customer experience, unify the many different information elements—filters, banners, promotions, product recommendations, and editorial content. Seen from the user’s perspective, these elements should all be parts of the same picture, presented in a coherent context. The user expects content shown in all of these panels to be orchestrated and related to what is relevant to him or her right now (see Figure 1).
Information Needs to Be Relevant: Targeting Customers with Product Recommendations Is Valuing Customers Is Keeping Customers
Using the behavioral data generated by product information and customer data (see the entire whitepaper), companies can:
- Monitor product exposure for different customer segments
- Gather information on how your visitors name, find, and filter products
- Learn which requests, products, and categories best boost the conversion of your channel
- Follow up customer behavior online after execution of print campaigns
- Learn which changes in product data have the biggest impact on conversion
With cutting-edge product information management, you can guide and inspire your customers with instant, highly relevant content like real product recommendations. Doing so makes all the difference in boosting the quality of their shopping experience and, ultimately, their loyalty to your site.
One last thing: Have you already thought about tailoring other sales and marketing channels beyond e-commerce and e-mail? What is the next logical buy at a call center or at an on-site store?
Do you know how good your multichannel data is? This blog covers four business objectives when accelerating multi channel commerce and which quality of product data is needed to deliver to that and a summary of questions to ask when establishing your strategy. These questions help ecommerce managers, category managers and marketers at retailers, distributors and brand manufacturers ask the right questions on product and customer data when establishing a multi channel strategy.
The Multichannel Challenge: Availability of Relevant Information
At every customer touch point, the ready availability of product information has a profound effect on buying decisions. If your customers can’t find what they’re shopping for, don’t understand how well your product meets their needs, or aren’t confident in their choice, they won’t complete their purchase.
When customers are researching or actively online shopping for products, research says 40 is the magic number:
40 % of buyers intend to return their purchase at the time they order it.
40 % order multiple versions of a product.
40 % of all fashion product returns are the result of poor product information (Consumer electronics are 15,3%; Sources: Trusted Shops, 2012, Internet World Business 7.1.2013)
All the high-quality product data in the world is useless if an organization cannot leverage that data for quicker time to market, improved e-commerce performance, and greater customer satisfaction.
Four Business Objectives When Accelerating Multi Channel Commerce
This white paper comes with four common use cases that illustrate typical business objectives within a multichannel commerce strategy. When looking into your product information, here is a list of questions you might consider.
1. Increasing conversions and lowering return rates by ensuring that customers can access product information in an easy-to-consume form.
- Where is the flawed content coming from?
- What tools and incentives can we provide for suppliers to maintain the high quality content?
- Which data quality processes should be automated first?
- Do we need a bespoke data model to fit your requirements?
- Can we effectively use industry standards for communicating with suppliers (such as GS1 or eClass)?
2. Lowering manual processing costs by merging the best product content from multiple suppliers.
- How many product catalogs do we have and what are the processes that slow us down?
- Who is responsible for the quality of the product information?
- How can we define and enforce the objective and measurable policies?
- Which supplier has best descriptions / certain translation, high-quality images / video / etc.?
- How do we collaborate with our large and small suppliers to achieve best data quality?
3. Growing margins through “long tail” merchandising of a broader assortment of products.
- Can we automate product classification?
- Which taxonomy will work best for us?
- Do all stakeholders have visibility of data quality metrics and trends?
- How can we leverage information across all channels and customer touch points, not only ecommerce?
4. Increasing customer satisfaction through more consistent information and corporate identity across sales channels.
- How should we connect customer and product information to provide personalized marketing?
- How can we leverage supplier and location data for regional marketing?
- How do we enable crowd sourcing of comments, reviews and user images?
- What information do internal and external users need to access in real time?
Find more information with the complete white paper on multichannel commerce and data quality.
The MDM space is filled by a number of well-known players. In addition to Informatica, you’ll also find IBM, Oracle, SAP, and a host of other vendors. But who’s the leader of this space?
The Information Difference is an analyst firm that specializes in MDM, and this firm has been watching the MDM space for years. Recently, The Information Difference compared 12 different MDM vendors, ranked them using 200 criteria, and published their findings in a report of the MDM landscape for Q2, 2013. The firm compared the vendors’ MDM offerings across 6 categories: data governance, business rules, data quality, data storage, data provision, and data movement.