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How product-level traceability meets consumer and regulator demands

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November 29, 2023

From DPP legislation to product origin stories, discover why product-level traceability is so influential.

With more consumers prioritizing sustainable purchases, product-level traceability is quickly becoming an essential aspect of product sales. IBM found that 79% of customers look for guaranteed markers of authenticity when shopping. Of that group, more than 7 in 10 would be willing to pay up to 37% more if companies offer full product transparency and traceability. 

It’s not just a matter of customer demand, either. Digital product passports (DPPs) will start being implemented in the European Union (EU) in 2024. This means manufacturers and retailers soon need to be transparent about everything from raw material sourcing to their supply chain’s carbon footprint. 

Gartner’s 2023 PIM market guide offers several useful insights on DPP and product traceability. Here’s what you need to know about how PIM can help you master these increasingly important product aspects. 

Read the Gartner 2023 PIM Market Guide

See what the analysts have to say about PIM and product traceability.

Understanding new legislation around traceability 

Gartner’s market guide outlines the impact that regulations like DPPs will have on businesses based in or selling products within the EU, explaining that they’ll change the volume of product data businesses need to hold. DPPs and more stringent sustainability reporting could also necessitate a shift in how businesses manage, record, and analyze data. 

This increased demand for data isn’t a fleeting trend, either. As time goes on, the requirement to create and update DPPs will penetrate more of the market. Gartner Analyst Helen Grimster predicts that “by 2027, 50% of the top 10 consumer goods manufacturers by revenue will implement digital product passports for at least one of their product categories.” 

Even if a business operates outside of the EU, other global regulations are pushing for greater product transparency. For example, the FTC’s Green Guides aim to stop greenwashing in marketing by preventing companies from making product sustainability claims they can’t substantiate. 

Preparing for digital product passports 

Apparel, batteries, and consumer electronics are the first three sectors the EU will implement DPP requirements for, starting in 2024. Other industries will no doubt shortly follow. Indeed, only food and pharmaceuticals are excluded point-blank from DPP regulations. But as businesses prepare for the digital product passport, how can they easily and consistently provide ethically minded customers with essential product-level traceability? 

Gartner explains, “Putting DPPs into practice requires a technical solution to collect all data about manufactured and distributed products.” The analysts position PIM as a practical way to bring sustainability data into one, accessible place that can accelerate activities around DPP compliance, as well as other regulatory requirements as they evolve.  

logs being stacked onto machinery in forest

PIM and product origin stories 

Consumers are actively seeking out more sustainable options. If your business is targeting this audience, understand they’re not just going to accept your sustainability credentials at face value. Edelman’s Trust Barometer found that just 34% of consumers trust the brands they buy from and as few as 20% trust brands’ sustainability claims. This means your products’ origin story could be key to engaging climate-conscious consumers. 

Gartner defines a product’s origin story as “the backstory or account of how a product came into existence”. It’s designed to tell the buyer where the product is from, who made it, how it was made, and how it arrived at the point of purchase. Your products’ origin stories could include data such as: 

However, creating these origin stories starts with securing a single source of supply chain data that forms the basis for rich, compelling product information. That’s why a growing number of brands and manufacturers are turning to PIM to fuel this important part of their sustainability story. 

Using PIM to share consistent traceability data 

Sharing origin stories can strengthen your sustainability credentials, as they lift the curtain on an ethical or low-carbon supply chain. Even if DPPs don’t impact your sector, there’s still a lot of demand for businesses to make their products more traceable. 

Gartner explains that demand for transparency is particularly high for products that are ingested or used in close contact with end consumers. This includes food and drink, cosmetics and personal care products, and clothing and accessories. The biggest issue? It can be tricky to find a standardized way to record and share this valuable data. 

To consistently create strong product traceability, you need technical solutions that make data capture and sharing easier. Gartner calls PIM the “foundational layer” that allows businesses to gather and sync up product data so it’s consistent and ready to be shared with consumers. PIM lets you input data into a centralized database which can then be relayed in a huge range of formats. This includes everything from DPPs to marketing comms to in-store informative materials. 

How product-level traceability supports sustainable purchases 

It’s not enough to state that your business is carbon neutral or to make blanket claims about the sustainable provenance of your goods anymore. Leading climate-conscious brands know that being transparent and traceable aren’t the same – and they should be taking tangible steps to move towards the latter. 

Tom Woodham, Partner at IBM, explains the difference between the two: “Traceability provides verified, granular supply-chain tracking data that connects any individual item directly back to its sources. Traceability is one category of information that supports a policy of transparency.” 

Even if your sector or business doesn’t yet have a timeline for DPP implementation, Gartner’s PIM Market Guide makes it clear traceability is here to stay. This highlights the importance of securing the right tech-driven strategy today to ensure you’re ready to meet the inevitable future state of product-level traceability. 

female shopper looking at wooden table in store

inriver: The PIM for product-level traceability 

The inriver PIM solution is the only PIM platform on the market capable of providing brands and manufacturers the capabilities you need for comprehensive product-level traceability. The fully extensible inriver data model offers the flexibility to capture, manage, optimize, and distribute product data from across the value chain. Inriver’s model also provides the elasticity required to meet evolving legislative demands, giving you complete peace of mind that your products will never fall foul of the regulators. 

The inriver platform is the complete solution for your entire product journey. The inriver PIM has built-in API-based syndication technology, advanced data sharing, and digital shelf intelligence through our two in-built digital shelf analytics (DSA) capabilities. These are just some of the inriver capabilities that combine to empower brands and manufacturers to offer comprehensive product-level traceability for every product at every stage of the omnichannel product journey. 

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Schedule a personalized, guided demo with an inriver expert today to see how the inriver PIM can get more value from your product information.

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