Few organisations have much chance of buying or selling effectively over the Internet without access to web catalogues containing standardised product information. In fact, web catalogue management is a prerequisite of collaborative e-procurement, collaborative selling and supply chain integration, according to catalogue management software specialists such as Requisite Technologies, Cataloga and Zygon.
But the truth is, uptake of catalogue management software has been much slower than these companies anticipated, and many organisations are reluctant to invest the time and money required to fully web-enable product data. Because of this, the short history of business-to-business (B2B) online collaboration is littered with failed ventures and projects that were scuppered by a lack of supplier participation.
To some extent, the issue is symptomatic of an immature market. Even when businesses are prepared to participate in B2B trading, they frequently take a blinkered approach to the available technologies, says Dave Dalton, vice president of marketing for B2B software vendor Ironside. One customer, he says, implemented Ironside's order management suite, but against Ironside's advice, made no plans to web-enable its product catalogue for use with the system. The result, says Dalton, is an almost useless order management system. While many companies are happy to build a business presence on the Internet, he adds, few will take these plans a step further until they are confident of a clear return on investment (ROI).
It is true that digital content and catalogue management systems are notoriously complicated to plan and deliver, involving a large investment of time and money. But the problem goes deeper than just ROI. Suppliers fear that they will lose control over product marketing if they make their product details available over the Internet, because of the restrictions imposed by online catalogue systems. For example, independent e-marketplaces and supplier hubs often limit the amount of product information each supplier can display. This is done to speed up the data input process and implementation time – but it also means that suppliers have little means to differentiate their products from those of their competitors.
Some software vendors have tried to address the problem of supplier reticence by placing the onus for organising product data on the buyer, rather than the supplier. For example, supply chain management software vendor i2 Technologies offers a service that enables buying organisations to aggregate supplier catalogues and product data into a single catalogue management platform. However, it is questionable whether the cost efficiencies to be gained by buyers taking procurement online will be as great as they might have been if the suppliers had taken responsibility for catalogue management.
Despite the lack of web-enabled supplier catalogues to date, suppliers claim that the market is showing signs of a turnaround. Twenty per cent of retailers are already implementing multi-channel product catalogue management software – used to manage web-enabled and other catalogues centrally – according to market research carried out by content management software vendor Zygon. Once fully implemented, these early adopters will quickly leave the laggards behind – not only because of the competitive advantage these systems can provide, but due to the fact that new implementations can take up to two years, says Zygon's CEO Stephen Edwards.
Certainly, e-marketplaces are taking a more proactive stance. Covisint, the automotive e-marketplace, has appointed catalogue management software vendor Requisite to provide its platform as a service to all the e-marketplace's suppliers. Meanwhile, Transora, the consumer packaged goods e-marketplace, has gone further, announcing that it has connected its catalogue management system to its collaborative planning, forecasting and replenishment application. It has taken the e-marketplace two years to get to this level of complexity, however. And so far, only one customer, Proctor & Gamble, has actually entered all of its products into the catalogue system.
Unfortunately, small businesses may find it hardest to embrace web catalogue enablement. According to Ironside's Dalton, there is still a lack of low-end, low-cost systems available. Suppliers such as Requisite offer hosted versions of their systems, targeted at smaller businesses, but in exchange for lower implementation costs, customers are likely to sacrifice "control over the information architecture that governs product classification and relationships, and the ability to quickly adjust to shifting market and user demands", according to analysts at market research company Forrester Research.