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Ecommerce Merchant Tools: ERP, PIM and the Web Product Catalog

No one ever said being a merchant would be easy. This is especially true for the web merchant who is at a distinct disadvantage compared to their in-store-only comrades. A store merchant has tools at their disposal and can create effective planograms from all the analytical, behavioral and demographic information they have collected around well-known customer behavior. In-store shopping is such a science that in-store merchants have figured out ways of making suppliers pay for inches of shelf space because the buying patterns of those inches of shelf space are so well understood.  The web merchant does not have such sophisticated tools or precision of web product placement. It will be a long time until a ‘webogram’ shows up that is as capable as its in-store counterpart. Web-merchant tools are immature, and ecommerce is changing faster than the Web-based tools that do exist can keep up with. The on-line ‘shelving’ is shifting with Rich Internet Application (RIA) and social capabilities, even before the buying habits of the previous ‘shelving’ were fully understood.  Making the Web merchants life more difficult is the emergence of microsites, a powerful way to extend selling capabilities, but these represent not just new ‘shelving’, but rather whole new retail concept stores. The Web merchant’s life is not easy.

There are some tools to help, but they are confusing and often not up to the task. Classically there are ERPs and Product Information Management (PIM) systems that hold the master product information. Then there are tools that hold Web-specific information, which we will call the ‘Web Product Catalog’. The Web Product Catalog tools hold digital-specific information such as how a product should show up based on a customer search query, or personalization result, or on a product catalog page, etc. The product information being administered on-line is becoming more complex as these search, personalization and display capabilities have become more capable. A merchant does not want a search engine administration page, then a personalization admin page, then off to the image software to link up the correct images depending on how a product is to be displayed. All of this administration should be consolidated. PIM systems are trying to become ever-more multi-channel to hold this type of information. PIM systems, and certainly ERP systems are large endeavors to implement already. And Web-centric product information is hard for any PIM to keep up with as ecommerce is changing due to innovations such as social shopping and RIA.

Classic PIM and ERPs that hold core product information are inherently multi-channel as they hold baseline product information such as the manufacturer information, cost, retailer price, and SKU information. Classic PIM and ERP systems such as GXS, SAP and Oracle do a good job at this. They may be too large for a mid-sized web merchant, but for a larger merchant, they do a good job at holding core product information. They have a hard time however keeping up with the Web-centric product properties of modern ecommerce.  The mid-size merchant, which is also a major player in ecommerce, often does not have the resources to implement these PIM systems, so the mid-size merchant does not even have these tools to help them.

All of this leaves a huge void in the merchant’s ability to merchandise ecommerce. In particular there is a void in the Web Product Catalog specific capability. The merchant does not have a good set of merchant tools to tune product information to display optimally for the customer experience. The merchant is under tremendous pressure to effectively sell over the Web as ecommerce is seen as a growth opportunity for retailers, but the tools are just not up to the challenge. All of the talk about multi-channel PIM tools speaks to some of this pain the merchants feel, but still the merchants often do not have the appropriate tools to configure the modern Web storefront. Merchants need tools that can control all baseline product information as well as Web-specific product information. The Web Product Catalog tools must integrate with a host of applications as the current Web site will multiple best-of-breed capabilities such as one vendor’s search engine, another vendor’s personalization engine, another vendor’s RIA storefront, another vendor’s affiliate marketplace, and on and on. The SaaS movement allows best-of-breed applications to be included in ecommerce Web storefronts, but all of these must be administered by the Merchant. Many vendors of Web storefronts include PIM tools embedded into their software. These often make this problem worse, as the solutions are vendor-specific, and then the overlap between the vendors’ other PIM systems only get more confusing. Also as a PIM system is often not agile enough to manage Web-centric product information, an ecommerce platform that has a Product Catalog built-in is often not robust enough to be a good PIM. So the multi-channel movement may have good intentions, but may be flawed.

The gap between the PIMs, the Web-specific product information, and the tools a merchant needs for ecommerce is a huge and ever-growing. There needs to be a fresh-look at what it means to create a merchant’s Web Product Catalog tool, and the current movement to unify all tools under a ‘multi-channel’ umbrella may be too simplistic, slow, and ultimately too expensive to implement for many retailers. Web Product Catalog tools must integrate with other systems such as internal PIM systems, and other Web-centric applications such as content management systems, search engines, personalization engines, RIA product viewers, affiliate sites, micro-sites, and now social networking sites. Rather than the PIM and ERP trying to encompass the Web Product Catalog, or ecommerce storefront vendors trying to build PIM system, vendors should look to a new breed of Web Product Catalog tools to manage this information. And these new merchant Web tools should not do it through centralization of information, but rather embrace the SaaS movement, and allow easy integration with these best-of-breed solutions. This lighter-weight approach also allows for more agility, so the Web Product Catalog tool can adapt faster as new ecommerce capabilities appear, and just ask a merchant who will tell you that the pace of innovation of new ecommerce capabilities is increasing all the time.