New product launches generate 25% of revenue and profit in successful companies, yet more than half of all product launches fail to meet their business targets. McKinsey discovered this failure rate holds whether the new product is something completely new or simply an incremental change to a familiar product.
The 50% failure rate persisted with companies that rarely launched new products and with those who launched several new products a year. McKinsey’s data showed that repetition doesn’t automatically lead to competence, at least when it comes to new product launches.
What did drive success, according to the data, was strong cross-functional collaboration and the ability to execute as a team—and that’s where product lifecycle management (PLM) and product information management (PIM) solutions come in.
PLM and PIM: Complementary capabilities
It’s easy to get bogged down in the alphabet soup of e-commerce technology. While PLM and PIM sound similar, they serve very different purposes in new product launches. Product lifecycle management is a software-enabled system that oversees the entire product ecosystem, from conception and design to production, sale, and disposal of unsold units.
PLM brings together designers, developers, product managers, merchandisers, and marketers into a single system to enable collaboration and accelerate business processes. PLM deals with product information as it relates to developing a new product.
A product information management, or PIM, solution acquires and manages all the new product data, shares it across the enterprise, and distributes it to e-commerce partners and channels. PIM operates as a single source of truth for every piece of product data, integrating information from your ERP, PLM, and other business and financial systems for a holistic and harmonious product view.
Together, PLM and PIM create the ultimate information supply chain, a central hub that empowers collaboration between developers, designers, marketers, and other stakeholders in the product launch process.
PLM vs PIM: Do you need both?
PLM deals with internal information; it doesn’t handle customer-facing product information. It optimizes design, development, supply chain, and production functions, giving product teams visibility and transparency across multiple processes, speeding the development time from concept to launch.
PLM is heavily focused on design, engineering, and manufacturing. It’s used to:
- Consolidate and organize product data in the product development process
- Promote collaboration between business units involved in production
- Develop and manage connected product portfolios
- Manage and manipulate product development data such as CAD files and bills of materials
If PLM manages the data necessary to create new products, PIM manages the information necessary to market, syndicate, and sell it. Faster product development won’t boost your bottom line if you can’t get your new products on the digital shelf. PIM makes it easy for your product teams to enrich product information with images, videos, text, and technical data and publish it to your market channels in any language, in any channel.
PIM consolidates internal and external product data in a central hub where it can be accessed by cross-functional teams. It can be used to:
- Improve product data quality and enforce data governance rules
- Align product content with marketing and distribution goals
- Enrich, contextualize and syndicate product information using technical specifications, localization, product descriptions, digital assets, and user reviews
- Power adaptive merchandising™ and personalization to provide high-quality product experiences
Together, PLM and PIM solve new product data quality and content management challenges, synchronizing the syndication and development processes. This holistic approach enables the strong cross-functional collaboration necessary to execute new product launches as a unified team—the core competencies McKinsey identified as key to achieving business targets.
Better business decisions
Teams with integrated PLM and PIM systems have end-to-end transparency of information which allows them to make faster, more informed decisions and capitalize on time-sensitive market opportunities. Faster time-to-market, increased selling days, and better utilization of human and content resources makes for a better bottom line. And, a better customer experience.
Product development and marketing teams work together more effectively, improving sales and margins. Marketers benefit from early and ongoing access to PLM data to help them better understand how and why the product was developed, and how best to bring the new product to market. Developers leverage PIM and market performance data to better understand customer preferences and demands as they conceptualize the next new product.
Ultimately, companies that embrace an integrated PLM and PIM approach achieve more agile go-to-market processes, speeding time to market, lowering costs, and driving sales. If you’re doing the same thing over and over again with new product launches—and getting the same mediocre results—combining PLM with PIM can optimize your go-to-market process and give you an edge over your competition. PLM and PIM are better together.
What defines the right PIM solution? Read more here about selecting the right PIM today to excel in tomorrow’s commerce.