The Source of Truth

Guide to E-Commerce Technology

For most retailers, the management of product descriptions and images used to be easy. Catalogers needed sharp photos with brief descriptions to print in catalogs. Chain stores needed medium quality photos with very little description for circulars and newspaper ads and sharper photos but still with little description for store displays.

But the Internet has changed all that. For starters, by making multi-channel retailing a requirement, the web forces all retailers to provide a great deal of information. For another, the web can contain a lot more information than any other medium and the most successful retailers provide great depth of information on their web sites. Thus retailers today are faced with the challenges of managing reams of information that they didn’t have to deal with at all in the past.

“The web changes significantly the information you need,” says Chuck Coleman, director of product system support for office supply retailer Corporate Express Inc. “On the web you have long descriptions about what the product is all about. A customer has to look at the screen and feel comfortable about placing an order because there’s nobody to ask, ‘What do you mean by this?’”

The trip-up

The challenge, then, is making best use of the data that exist. And that’s where many retail operations trip up. The e-commerce group could be in charge of the information that goes to the web while the catalog group would oversee the content that flows into the page make-up programs for printing and the store signage managers would have control of the information for store display. And they all reside in their own data systems. “It’s a big challenge to get this information into a database that all can use because it’s in silos now and the people in charge have been doing it the same way for years,” says Scott Heimes, president of Virtucom Content Solutions Inc., which provides content for retailers’ product databases. “Many have the attitude ‘This is my space, don’t mess with my signage department.’ ”

Some vendors, though, are realizing an opportunity exists in helping retailers make sense of their disparate systems and have created programs that output the content to whatever format a retailer wants, whether it be web, catalog, brochures or signs. Participants include companies that are coming at it from a print background, such as Pindar Systems, an offshoot of European printer Pindar plc; an online content management background and adding the print component, such as Trigo Technologies Inc.; or as a provider of broader merchandise management solutions, such as Evant Solutions Inc. (see box, p. 41). “Most of our clients end up re-cutting the same product information over and over,” Heimes says. “Retailers need to build it once and make it flexible enough to be used for all their needs.”

Data needs go up

Privately held U.K. catalog merchant Littlewoods is one retailer that understands the need to re-use content. Littlewoods sells 24,000 products with 100,000 SKUs through a 1,200-page catalog that it creates twice a year and which it calls the All Inclusive catalog, as well as through auxiliary catalogs called the Extra catalog and Index catalog and sales and end-of-season closeout brochures. It also operates three web sites that sell the same merchandise as the catalogs. For 12 years, Littlewoods has done catalog production in-house, so it has an extensive understanding of the catalog process.

But Littlewoods found that its need for data went up very quickly when it added the web site. For instance, images were a problem. “All the photos for the books were done in a spread,” says David Fleming, Littlewoods’ IT publishing manager. “So if we had a toy spread, a group of toys would be put on a table and a picture taken. Or if we did jewelry, all the different types of rings, or necklaces or bracelets would be put on one board for a picture. That didn’t work on the web, where we want to sell each item individually. We had to cut each image into 25 separate images.”

And so the web managers had to start thinking about each product as an individual product with product attributes, he says. That resulted in each product having its own picture and many fields of data. And it resulted in managers realizing that the data already existed within the company and it was foolish to re-create it for web use. “They realized quickly they needed a feed from the publishing system because that’s where we had all the information,” Fleming says. To provide that feed, Littlewoods is installing the new Agility product from Chicago-based Pindar Systems, which creates a single database for all product content.

As the experience with product photos shows, Littlewoods, like other retailers, found its need for product information going up as its channels multiplied. Photos, for instance, suddenly need to be available in a number of formats for both web and print use. Similarly, product information spans the range from everything you ever wanted to know for web site use, to description, size, color, and price for catalogs, to three or four words and price for ad circulars. Furthermore, the amount of data in a description explodes as the web creates shopping experiences that consumers never had before or streamlines previously cumbersome processes. “We are getting all the attributes of products plugged in so consumers can do side-by-side comparisons,” Coleman says. Corporate Express is using Trigo technology to manage its web database and is exploring ways to use Trigo to create a single database for electronic and print.

Creating consistency

A centralized database makes managing all the data easier, by having a single “source of truth,” in the words of Russ Henry, senior vice president of marketing for Trigo. By reducing the need to re-input and re-format the data it reduces the need for production staff, which retailers often fill on a temp basis. And it permits the same shopping experience across channels. “It allows us to create consistent presentation of data to the customer,” Coleman says. “Customers who are used to looking at products in your catalog expect to see products presented in a certain way, whether it’s in the catalog or on the web. This will allow us to do that upfront, rather than going back and correcting the web once the catalog is out.”

An integrated system also can feed data to invoices, making them more accurate and matching the product description on the invoice more closely to the description in the catalog, on the web or in other marketing material. That accuracy results in faster payment, Henry says. “With one customer, 10% of accounts receivable went into arrears because the product description on the invoice didn’t match the product description on the web, where the customers bought products,” he says.

Creating a single-view database is a huge project that needs direction from the top of the company and an acknowledgement that it changes the way the business operates. “Companies need to make sure there is an element of change management in the process,” says Carsten Lau, director of marketing of Pindar Systems. “That means getting people involved and making sure they understand that roles are changing.”

The next step, Lau says, is to identify what he calls the power users in each department whose acceptance of the system can drive others to accept it as well. “A power user is usually middle management who’s involved hands-on but oversees the whole thing and understands how a change in one department affects the neighboring departments.”

Next, management needs to bring each person involved in creating product descriptions into the process. “You need to work with each member that touches the product process,” says Jack Harbaugh, vice president of business development at Evant. “You have to find out from all of them what their rules for data are and what they need from others in the organization.”

Once the process is in place, retailers should start small. Moving multitudes of data into a single repository can be a daunting task. Littlewoods, in fact, is undertaking the project a bite at a time. Its first combined databases will not be ready until November, a year after it made the decision to work with Pindar, and it does not expect to complete the transition until late next year. “Narrow the scope; don’t try to do all corporatewide information at one time,” Trigo Technologies’ Henry says. “Start with a product line or a division.”

Product expert

A launching point for the actual creation of the database, Henry says, is the person responsible for knowing the entire product or product line and all its attributes. “We usually find a person in every company who is the product expert,” he says. “That’s usually the brand manager or the product manager and that person knows everything there is to know about a product line or family. They are the ones who gather the information and then enrich it from their own knowledge.”

Once the information is in the database, it still requires someone to be responsible for making sure it’s correct for all uses. At Littlewoods, that responsibility falls to the catalog group. To ensure consistency between catalog and web, Littlewoods does not create web pages until catalog production managers have signed off on the catalog pages.

That then creates huge pressure on the web production side to make sure that the web sites are designed and ready by the time the catalog hits the streets. That usually entails hiring of large numbers of freelance help in design and production to meet deadlines. With the new integrated system, Littlewoods plans for the information to be in a web-ready format by the time the catalogs are completed. Typically, the e-commerce side of the business then has six weeks at the most to prepare everything. “That’s incredibly ambitious when you have 24,000 products to present,” Fleming says.

Littlewoods expects the Pindar system will streamline the process and reduce its need for temp workers. “When the program is done, the catalog team can kick it over to the EC team and they can start on it straightaway,” Fleming says. A further benefit is that if someone from the catalog side makes a change to the data, the system alerts anyone who is working on the data. “It’s more accurate and more timely and will create an improvement in productivity,” Fleming says.

Similarly, Corporate Express expects a rapid reduction in the amount of time it takes to produce sales flyers. It produces nine flyers a year, each of which takes four to six weeks. With a centralized data base, it will be able to pull all the information together and create a flyer in two weeks, Coleman says. Corporate Express also expects an easier time of creating specialized catalogs, such as its catalog for the legal profession or its forthcoming janitorial supplies catalog. “Everything comes from the same fountainhead, so we get a very consistent grouping of data,” he says.

Creating a centralized product database can cost $100,000 and up to license software. Or retailers can opt for ASP delivery of a product from providers such as Evant for which a retailer will pay $15,000 a month, but not have to invest in training of staff. In fact, Harbaugh says the company thought most retailers would be interested in licensing the software and has been surprised to find a great deal of interest in the ASP model, in which Evant hosts and runs the application. “There’s no infrastructure or resource investment,” Harbaugh says. “We are finding that most are interested in the ASP.”

Tough to measure

Measuring ROI on such an investment is not easy, retailers say. Certainly, there’s the immediate payback in reduced re-input of data and fewer temps scrambling to meet deadlines. But there’s also the unmeasurable. “There’s a risk if you don’t have a good system to deliver catalogs,” Fleming says. “If you’re two weeks late with your new catalog, all your customers will go to competitors and you could lose millions.” That risk is exacerbated by the fact that other retailers are looking at the same kinds of systems to streamline their own production. “If you’re on a system that’s seven or eight years old, you run the risk that competitors will move to the new technology and that will give them an advantage,” he says. “Those are difficult to put a value on, but they’re all risks.”

Most reports, though, say Littlewoods, Corporate Express and others who are moving to a centralized database for electronic and print presentation are in the vanguard. Few retailers have adopted single databases yet. “It’s very uncommon,” says Heimes of Virtucom, who works with some of the biggest retailers in the U.S., including Wal-Mart Stores Inc., Best Buy Co. Inc. and Toys R Us Inc. “I know of almost no retailers who are doing it well.” Given the long lead time to implement such systems, the early adopters may find themselves with a little breathing room.

kurt@verticalwebmedia.com

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2002 Guide to Catalog Management Systems