Here, ITC Infotech, a global IT services and solutions company, share their sixth guest blog with us. Written by Shruti Gandhi and Shailesh Badoni (Process Consultants for Retail and Soft Goods at ITC Infotech), this article explores the benefits of PLM for e-commerce business.
Browse – Select – Pay! Your desired products are just clicks away. This is how e-commerce has redefined the modern world of shopping. Being able to shop while sitting at home or on-the-go with convenience, having varied choices and getting price advantage is a boon in our busy lives today.
E-commerce has captured a big market share of the retail industry and is all set to outpace brick and mortar stores in coming years. As per a research conducted by Conlumino*, the global online clothing and footwear retail sales is forecast to surpass US$300 billion by 2018*. Along with offering multiple brands, e-tailors are now also betting big on private labels.
Private labels present a win-win situation for both parties where customers get more choices and better value and retailers get better margins and are able to distinguish themselves from the competition. Moreover, consumers feel happy about the larger brand assortments offered on a single platform at lower prices.
Many e-tailors and marketplaces have emerged with focused business lines along their private labels. The pricing advantage is undeniable, with lesser cost of marketing and promotion – they get easy visibility on the website alongside the popular brands.
E-Commerce Private Label and Product Development
Building a private label requires in-house expertise in designing, developing and sourcing. An efficient product development and sourcing process can go a long way in ensuring that the final product delivers intended value as compared to national brands.
With all the complexity involved in Product development, it is of utmost importance that the retailer uses the right tool to handle processes. Product Lifecycle Management is one such proven technology that has been helping retailors to efficiently manage the complex product development cycle by providing seamless integration between processes and connecting various stakeholders. Collaboration at every stage helps rooting out inefficiencies and expediting the entire process.
PLM, which is now an established tool for new product development and sourcing in fashion retail across the world, can cater to the needs of the growing e-commerce industry.
By providing a common web platform to all the internal and external stakeholders, it can reduce the time required for products to be conceived, designed, sourced, manufactured and be made available online. In the dynamic e-commerce industry, designing, planning, specification gathering, sourcing and vendor management processes need to be aligned at a much faster pace. PLM certainly addresses these needs and helps in attaining significant improvements in product quality, margin and overall operational efficiency.
E-Commerce and Product Information Management
John Hagel, a well-known consultant and author opines: “What we know now is that the ‘E’ in e- commerce doesn’t stand for ‘Easy’.”
To create distinguished product offerings every time, there is constant need to be proactive and have required information at your disposal. This has made the entire process of offering products online even more complex than it seems.
Comprehensive product information can actually act as a sales consultant when a customer shops online. The information they usually seek from a sales consultant can now be at their disposal at all times. Properly presented product information helps you to convert more clicks into sales.
On the other hand, reaching out to more customers and offering larger assortments mean more product information to be handled. Overall, there is humongous data which need to be efficiently managed and effectively retrieved to provide an enriched online shopping experience.
E-tailors use Product Information Management tool, which interacts smartly with the e-commerce web portal and reduces the manual effort in data management. PIM or Product Information Management solution incorporates best practices and technologies to manage product information throughout an enterprise to improve information sharing and product knowledge management. Its ability in terms of reducing information complexity by providing filtered and accurate data from multiple sources can be really helpful in providing a richer product experience. That’s the essence of virtual sales platform like e-commerce.
In PIM, information is tagged with meta tags, which help in filtering the required information by avoiding duplication. It processes data to publish them to web sites, catalogues and other media required for end use.
One of the major sources of product information can be Product Lifecycle Management tool. PLM not only helps in streamlining the workflow but also works as a central data repository to store product data related to its entire development cycle. Data in PLM are captured at their origin, which avoids duplication of effort.
Synergy between PLM with PIM for E-Commerce
An effective and extended IT Solution which integrates PLM with PIM to handle product development and vertically pushes the same to maintain product information gives the best of both the worlds.
This will be beneficial in multiple ways:
PLM mainly focuses on functional and technical areas of product engineering, whereas PIM deals with commercial and selling aspects of the product. The combination of both gives desired results and helps in increasing revenue by streamlining the overall information flow at reduced operational cost. E-tailors who haven’t invested in either of them or have only one of the systems in place should definitely consider having this smart integration to optimize their revenue potential and achieve profitability goals.
In this age of Digital Darwinism those who do not have a constant appetite for innovation will find it difficult to survive, and e-commerce being a technology based business model will find this even more significant.