10 Questions About PIM Systems: Improving Product Information and Catalog Management

This article was reviewed and updated on May 26th, 2023

As a business grows, managing product information becomes more challenging. Companies aiming to improve their efficiency are increasingly turning to PIM systems.

What is a PIM (Product Information Management) system?

Product Information Management systems manage product information and streamline and automate processes that use this data. PIM class solutions are often used to optimize catalog management, usually by the marketing and sales departments or by product managers.

A PIM system gathers and consolidates product information from various sources, enabling its publication in many channels. The required data can be easily searched, verified, and enriched. It’s also much faster to update product information or add a new product to the database.

As a result, PIM class software provides control over product information and reduces data handling costs. Its ability to organize data and promote consistent data quality makes it an excellent foundation for building an e-commerce platform, improving omnichannel sales, or entering new markets.

10 Questions About PIM Systems

1. Does my company need a PIM system?

Whether you need to implement a dedicated PIM system depends on your company’s stage of development. If the current way of managing product information makes it difficult to invest in new sales channels, foreign expansion, or process optimization, you might want to consider implementing a PIM system.

For small companies, the flow of data and information between employees is easy. But the larger the organization, the greater the need to establish product information procedures and automate this process. When the number of employees, products, and locations grows, managing it without a dedicated system can generate heavy costs and carries a high risk of human error.

2. When does a company need a PIM system?

Multiple factors signal that a company should consider implementing a PIM system. The most common include:

• Product information is scattered throughout the company.
• Your catalog contains many products or product variants.
• You have multi-channel sales (or are planning to add them).
• The product information provided to business partners/customers is inconsistent, outdated, or of poor quality.
• New products are not immediately entered into the catalog.
• You operate (or plan to expand to) multiple markets.
• No one has complete control over the flow of information in the company.
• Employee productivity is low.
• The product lifecycle is challenging to define and document.

3. What benefits can a PIM system offer?

Product information is used by people at every level of a company. Employees and team members use product data for information and sales. Managers base their decisions on sales policies and direction for specific products. Company executives need product information for strategic planning.

Product information is used at many stages of a product's lifecycle: from its creation, through sales and development, to its removal from the catalog. This data is essential to optimally plan production and logistics.

Implementing a PIM system improves the quality of product data used in creating sales materials and marketing content. Data stored in a uniform form is verified by the system and, with the help of appropriate tools, by employees from different departments. As a result, data is always available; this accelerates new sales and marketing initiatives.

In addition, PIM systems are an invaluable support when organizing internal and external training. Product information is often the first element that new employees encounter. It gives them a knowledge base of what their company offers, produces, or sells.

4. Can't I just use Excel instead of a PIM system?

Despite their broad applications, Excel spreadsheets cannot replace a PIM system. Many types of data (e.g. video and image files) can’t be managed in a spreadsheet.

The amount of data, product variants, and attributes require a tool that allows the convenient browsing, searching, creation, enrichment, and updating of data. In PIM systems, it is easier to introduce and enforce rules with a predetermined, consistent convention for entering and editing data; this promotes process automation and data quality.

Managing product information with Excel will also quickly result in an overloaded and unreadable spreadsheet. Searching, editing, or verifying data will soon become cumbersome and time-consuming. This leads to reduced company efficiency and can cause errors in product information.

5. How can a PIM system help reduce operating costs?

PIM systems improve an organization's operations by (among other things) improving efficiency. Employees can focus on their primary responsibilities instead of wasting time searching for and verifying information. These time-consuming tasks are easy to automate with a PIM system.

At the same time, the architecture of Product Information Management systems protects the company from business and security risks associated with the circulation of different versions of the same file. It’s therefore much less probable that management will overlook some important information and base their decisions on outdated data.

Incomplete or incorrect product information is also one of the leading causes of product returns. By improving data quality, the PIM system helps significantly reduce the scale and unnecessary costs of these situations.

6. How can a PIM system support international expansion?

Organizations operating in multiple markets must address their content to multiple – and often distinct – sales channels. A PIM system allows processing and exporting data, as it’s a central hub of product information. It supports its localization, i.e. by tailoring the messaging to the context of a specific market, including translating descriptions and adapting to different search conventions.

An excellent example of this need is the car markets in Poland and Germany. In the Polish market, vehicles are identified by a VIN code; in Germany, a KBA is used. This means that a separate filter is needed for car sales in Germany. This determines the visibility of products, i.e. if part of the catalog is presented only to a specific market or if it’s not available in that market.

Without a PIM system, individual markets become autonomous entities. It gets more challenging to manage the catalog; for example, changing the price of products in independent channels in different countries becomes much more time-consuming. With a large scale of operations, it becomes virtually impossible to maintain consistency in communicating the offer across markets. On the other hand, PIM opens up new opportunities in international business, as it’s a central platform to control what happens to individual products in individual countries.

A PIM system also significantly reduces the need to manually enter and change product information, introducing more automated and structured processes. This streamlines the work of distributed teams, speeding up the process of matching the materials to the specific requirements of international markets.

7. How does a PIM affect managing the pricing, inventory, or supply of products?

Price Management Software (PPM) systems are responsible for price management, and Supply Chain Management (SCM) solutions are used to manage supply chains. Resources are in ERP, and inventory is in WMS (Warehouse Management System). Building functionality related to building, formulating, and managing the pricing or availability in a PIM system creates an unnecessary SPOF (Single Point of Failure). Additionally, it significantly reduces the efficiency of processing such data.

PIM can be integrated with an eCommerce web store or ERP software to improve the management and consistency of product catalog information. With all product information from multiple systems synchronized in one place, the time spent on data entry tasks is reduced and data quality is improved.

8. What should I consider when selecting a PIM system?

The PIM system should be individually tailored to the needs (current and future) of your company. It should meet its functional and non-functional requirements, which may include:

• The number of methods used to add attributes.
• The scope of filtering and searching for information.
• Integration with other tools.
• Versioning.
• Language versions.
• How offers are presented.

In turn, multiple factors determine the requirements, such as:

• The number of data sources.
• The amount and quality of data.
• Specific business objectives.
• The number of people involved in the process and responsible for product information.

9. What will better address my company’s PIM needs: a custom solution or an out-of-the-box product?

The first challenge in choosing a dedicated product information management solution is your company's specific requirements. In every organization, product information management (tools, procedures, responsible people) looks a little different. It reflects the company's history, unique way of operating, business model, culture, and communication style.

Considering this, many companies prefer proprietary solutions tailored to their business. Sometimes it's a collection of independent systems; other times, it's simply a database or a shared drive with many files. However, they have their drawbacks, too - there are times when development capabilities are limited and maintaining such a solution is simply not worth it.

The answer may be a hybrid solution in which an out-of-the-box (OOTB) system is implemented and any additional required functionality is delivered as a separate module. Independent modules are then tailored to the client’s custom needs. They can then be personalized, avoiding the prevalent problem of vendor lock-in. At the same time, since no code is added to the OOTB system, we avoid potential future versioning issues.

10. What does a PIM system change?

The response to the appearance of new documents, files, and folders is often to add more procedures. This leads to the emergence of a knot-like structure where there is no hierarchy and the various elements tie together in an unstructured way.

In contrast, managing product information with a PIM creates more of a tree-like structure. The PIM system is the central point – a trunk – that guarantees the coherence of the entire ecosystem. It distributes information to individual sales channels and collects feedback, which goes to a central point and strengthens the development of the whole structure.

As a result, PIM systems work at the intersection of the company's many departments, streamlining communication while increasing individual units' operational efficiency. This frees employees from monotonous, manual work and allows the company to utilize its core competencies better, consequently improving efficiency and increasing profits.