Why retailers struggle to obtain and effectively use product information

‍

‍

‍

According to McKinsey a single retailer encounters on average 15000 inaccurate product data per year which contributes to 2-5 hours spent on verifying product data per average SKU.

One of the largest merchants for building materials in the UK estimated that 70% of products from suppliers had missing or inaccurate product information in 2022 which directly contributes to high return rate.

Why in this digital information era does it take so much time and effort to transfer product data? It should be easy: export-send-import. So why doesn't it really work that way?

Through our solution X-Trade we have connected trading partners and transferred data of around half a million products from hundreds of data sources, dealing with numerous data use cases, structures, systems, formats, logic rules and users in building materials and furniture industry

‍

The Main Obstacles

In our experience the main obstacles for transfer of product information are:

1. Internal product data "mess"  hinders efficient data transfer internally and externally

Whether your product portfolio has 50 products or 5 million, product information has to be shared with retailers or directly with customers to enable sales. Unclear data structure and lack of consistency in product data management heavily impede sharing of product information between internal and external users. Without taking real ownership of the product information and business value that lies in it the expression "mess in, mess out" is very real.

2. Multiple data sources make it hard for retailers to link received product information in a consistent way

Spreadsheets with incoherent data in various formats are often followed by separate price lists and files (images, specification sheets, DOPs, certificates, BIM objects) that are voluminous and not aligned or linked inconsistently with product data. In many cases lack of product codes or ID numbers makes it even more challenging to consolidate and import product data.

3. Data format that is "indigestible" by other systems

‍Example can be many like spreadsheets with multiple tables, merged cells, unclear headers, grouped or filtered by colours; brochures or DOPs in PDF format; product description in text files; images with names that can't be hyperlinked to product data.

4. Data mapping is tedious, repetitive and error prone

‍In order to import digital data into a retail system you need to map each received data source, like spreadsheet, to the data structure in the target system.

Should product measurements be stated in imperial or metric units? Should the measurement unit be stored as a separate attribute? Is "diameter" attribute in one product equivalent to "outer diameter" in another product? Can a manufacturer's product "long description" be used as retailer's "marketing description" that feeds the web store? What if the web shop attribute "marketing description" has a length limit? The list goes on and on.

5. Various product grouping force manual and repetitive matching process

Each manufacturer, wholesaler or retailer has their own assortment structure and product grouping. Assigning products to their respective groupings is a time consuming task and requires understanding of that grouping logic. Should the table be presented as a desk or a kitchen table? Or maybe should it be in both categories?

6. Complying with industry regulations and standards requires knowledge

Whether these are safety regulations like CCPI or incoming commercial standards like DPP, they all set clear requirements on product data structure, management and transfer process. 

For example the Code for Construction Product Information requires product information to be clear, accurate, up-to-date, accessible and unambiguous. Does your product data structure satisfy the growing industry requirements?  Do your systems and transfer methods keep your product data up-to-date and accessible for retailers at all times?

7. Rigid, manual and inconsistent data transfer solutions make data import very cumbersome and in consequence limit product presentment and assortment scaling

Receiving or downloading hundreds of spreadsheets in various formats, price lists in pdfs, folders with files and documents and manually mapping and importing them to internal systems is time consuming enough. With such a workload it’s hard to keep adjusting assortment and product presentation to market demand and trends. It’s hard enough to maintain the product data, so there is little or no space for effective use of product information in order to grow sales.

The above struggles go for most manufacturers' product data. What if a retailer’s supplier number goes in hundreds? The workload is unimaginable. But that's most of retailers' reality today. It forces retailers to limit assortment, product information and number of suppliers. It takes away resources dedicated to managing orders and building marketing campaigns or sales strategies. It hinders the digital presence of both retailers and suppliers. It hinders business growth of all parties involved.

So what's the remedy?

1. Re-think and re-own your product information

In an increasingly digital world ignoring the business value that lies in product information is dangerous.

How do your customers find out about your products? How are your products presented digitally? How can anyone filter, compare and choose your products? How do customers or your stockists place orders with you? How do you organise delivery? How do you analyse what attracts customers the most?

None of these processes goes without product information, even if the data lives in various systems used by many users, internally and externally. Take a closer look at your product information needs, structure, sources, processes, use cases, systems, tools, workflows and users. Re-asses if they consider all internal and external touchpoints and answer needs of all parties that use product data in and out of your organisation.

2. Draw the baseline among all your data sources

Each data source has its own structure and logic. And it should have! Both structure and logic serve its purpose. Whether it is business processes tracking, production management, order management, sales or marketing - product data should facilitate those processes not hamper it. The point is to choose the right product key identifier and use it along with the product information in all databases. Whether it is SKU number, product ID or GTIN, it should be unique for each single product and stored along the product data in each data source. This will enable easy matching between data sources and aligning product information across the systems net.

3. Ensure data clarity

There are a million ways to name colours, finishes, installation methods, provide measurements or delivery times. Is the data you share clear enough for anyone who's not working in your organisation? Are the product attributes easy to read and understand? Is it possible for your retailer to map your data attributes to their own system without extra clarification?

Use simple names, understandable labels, common expressions and standard formatting. If necessary attach comments that clarifies the meaning behind the attribute and minimises the chance for potential misunderstanding. Make sure that the shared information presents the product in a clear, accurate and unambiguous way for anyone reading the data especially out of your organisation like customers, retailers, specifiers etc.

4. Monitor your data quality

By continuously monitoring the accuracy and completeness of your product information, you can ensure that it is reliable and up-to-date. This facilitates use and trustworthy analysis. Include regular data quality checks as part of your routines. You can run reports or exports, filter or compare data from various sources. Don’t forget to talk to users and get familiar with their hands-on routines! They are well undermined sources of information that can immensely help improve data quality.

Moreover, monitoring data quality helps to minimise miscommunications and errors in the ordering process, leading to improved customer satisfaction and reduced product returns. One of the biggest building materials retailers in the UK admitted that 70% of their products presented in the online store have errors in product information causing a significant volume of returns. What if your retailer could communicate and give feedback on the quality of your product data or suggestions for improvements? Leave the doors open for the communication about your product data - it will pay back in growing turnover.

5. Get familiar with the retailers use cases

Retailers may ask for product information on multiple occasions and for different reasons. Do they need to feed their ERP or webshop? Do they work on a new in-store sales campaign or digital marketing strategy? Do they need to comply with any industry standards or growing market demand for data transparency? Get familiar with the use case and make sure your systems and processes are flexible enough to provide at any given moment various relevant datasets without extra effort or impeding data quality.

6. Know the touch-points before choosing a data transfer method

There are a variety of ways to exchange product information, let it be via email, sharing spreadsheets, sending files via FTP, using cloud solutions, databases, API or data exchange platforms. Each of those options have their own pros and cons. The right choice is the one that fits all touch-points involved in your data exchange. Transferring product data between any systems or databases requires understanding of the source system, transfer method and destination system. What transfer method would match current processes on both sides - email, file sharing, file dropping, API call? What import method does a retailer prefer - manual with CSV or excel file, semi-automated with file pickups or automated API? Make sure that the data transfer method answers needs on both sides without putting extra manual effort each time the data is shared. 

7. Keep in mind your products' digital presence

Retailer is a direct extension of product digital presence and an interface for digital sales. Comprehensive and consistent digital product presentation built trust and loyalty with customers.

How are your products presented by your retailers? Is the presentation consistent at all websites where your products are found? Does it include all information required by customers? Is it optimized for search and filtering? Does it look appealing?

Have a conversation with your retailers about how they present products digitally and what product data format and transfer can help them to put your products in a digital spotlight. Consider using keywords, unique product identifiers like GTIN, formatting the data for easy filtering and structuring it for easy pick-and-match any database and webstore.

Read more about the impact of product data on digital product presence and sales in our blog: Digital product presence and sales heavily rely on seamless data transfer from supplier to stockists' system.

8. Maintain control over data exchange

Sales strategy, product pricing or segmentation influence product data exchange with trading partners. Data management and transfer solutions should serve and empower your commercial relationships instead of constraining it. Same goes for complying with regulations or standards like Digital Product Passport, that require version control management. Whether you use geographical pricing, operate in different market segments on different commercial terms, or need an effective way of managing version control - evaluate if the data transfer solution gives you the possibility to efficiently control product data exchange and versions. 

‍

9. Follow industry standards

Get to know and understand the motivation behind market regulations, common classifications, industry standards and initiatives. The reason behind will help you to structure and keep your product data clear, accurate and unambiguous as well as choose the most suitable data transfer tool.

For example the Code for Construction Product Information requires product information to be clear, accurate, up-to-date, accessible and unambiguous. The initiative originated as a response to Dame Judith Hackitt’s independent review of Building Regulations and Fire Safety conducted after The Grenfell Tower tragedy exposing decades of regulatory failures within the building industry. It seeks to provide assurance that users of product information have the necessary facts when making decisions about specifying or installing the verified products. In other words it seeks to assure high standards in construction product safety.

The UK’s NBS construction products database aims to serve architects and specifiers providing them with the source and tools to make informed decisions and specify products right in the design tool. It makes it easier for specifiers to choose the right products.

The European Digital Product Passport (DDP) proposal promotes circular economy and supports sustainable product choices by making product information available across the whole supply chain and throughout the entire product life-cycle. Following the battery sector pilot, the priority sectors for introducing DDP will be electronics, textiles, furniture and construction. You can read more about the proposal and its consequences for furniture and construction industries in our blog post What are Digital Product Passports and why are we going to hear a lot more about them?

There is a lot going on in the spectrum of digital product information. The digital future is not knocking at the door anymore. It is storming in, bringing new requirements and new opportunities. In order to comply and jump on the wave of digital transformation, choose product data solutions that are built to support the digital vision for the whole industry and create a smart network of product information exchange.

10. Choose solutions that can scale

Scalability is fundamental to the performance and cost-effectiveness. It involves handling increased complexity and higher demand while maintaining or improving efficiency and effectiveness. The ability to scale is a key feature of any robust data management solution. Pay attention not only to how much data the solution can manage, but more importantly if the complexity of the structure, formats and number of connections can easily be scaled. You might have “only” 50 or 100 products. But the amount of data required to present the product digitally is growing every year as well as the number of touch-points you need to exchange that data with. Choose a solution flexible enough to accommodate growing number of attributes, categories, input and output formats, connections, transfer methods and touch-points.

11. Address the future - connectability and automation

Product information is constantly changing, keeping it up to date is a never ending task. Automation solves the pain of maintaining product data up-to-date in all connected systems for all connected parties. But true benefits of automation can't be achieved without connectability. Connectability in any aspect is a crucial factor of growth as it facilitates exchange. No matter if you are a small company or a large corporation, connectability makes your business grow. In an ever faster changing environment connectability and automation are the future of product data management. So introduce solutions that have a high factor of connectability and automation facilitating creating error prone, dynamic and seamless product data network, internally and externally.

‍

Conclusion

With the ever growing digitization and AI-boost exponential increase of online content, robust and trustworthy digital presence become undeniably a key factor for commercial success and growth. Online presence of an organisation itself, in the form of a website, web shop, social media posts, newsletters or blog, ceased being sufficient to reach out the customers and build trust. In the online content “jungle” customers want to find and order relevant products with ease. They can do it only if a product itself has a strong digital presence. Customers require availability and transparency of product information more than ever before and that is relevant for any place the product can be found online - manufacturer's website, retailers webshops, industry databases etc. Building and maintaining strong digital product presence starts with taking full ownership of product information. It means on one hand making the product information clear, accurate, up-to-date, accessible and trustworthy and on the other hand creating a data network based on the principle of connectability, automation, scalability, compliance and cooperation.

Are you ready for the next era of digital transformation?