New tools help suppliers create digital catalogs

Astronomical numbers are a mainstay in the business-to-business e-commerce arena. Analysts regularly forecast electronic transactions that will total in the trillions of dollars by 2004. Likewise, virtually every new Internet marketplace promises to bustle with big buyers who represent billions in spending power.

Yet conspicuously absent from all the hype are the tens of thousands of suppliers predicted to populate the marketplaces. The problem is that the primary selling tool for scores of suppliers remains a dog-eared paper catalog, which has yet to go digital, much less be uploaded for use on an electronic exchange.

“The thing that is missing from all of these exchanges is the critical mass of second- and third-tier suppliers,” said Joshua Greenbaum, an analyst at Hurwitz Group Inc. in Framingham, Mass.

“It can cost suppliers anywhere from 50 cents to a few bucks per product to get an [electronic] catalog going,” Greenbaum noted. Consequently, “content is a massive issue for all e-marketplaces. It’s something that should have been thought of a long time ago but wasn’t because things were moving so fast.”

But now, new software tools designed to help suppliers assemble electronic catalogs and keep them updated are beginning to hit the market.

The vendors offering these tools all specialize in software that can aggregate and standardize unstructured product data from diverse sources, then translate it into a format usable in an electronic marketplace. But there are also several differentiators.

Austin, Texas-based Liaison Technology’s tool, for example, is geared toward business users. It allows them to drag and drop product data from PDF files, Web pages and other sources for placement in an electronic catalog. The catalog can then be automatically updated based on business rules set by the user., an electronic marketplace that caters to advertising agencies, uses the Liaison tool to collect data from the Web pages of the 1,900 publishers included in its online catalog. Previously, SparkOnline had six to eight employees call publishers for the necessary data, which had to be keyed into the computer system and then updated manually on a regular basis.

“Now, we expect one person to manage content,” said Joel Davis, vice-president at the San Francisco-based electronic marketplace. “If there’s a change [in a publisher’s data], we’re alerted, and it updates our catalog automatically.”

Poet Software in San Mateo, Calif., takes a supplier self-service approach to electronic catalogs. Suppliers use the vendor’s tools to pull legacy data into a single master catalog, which can then be uploaded to an online marketplace and continually updated automatically via business rules set by the supplier.

Looking ahead, some analysts said they expect an increasing number of Internet marketplaces to offer suppliers electronic catalog services as a way to quickly build liquidity on their exchanges.

“E-marketplace software vendors initially went after the big pockets on the buy side. They’d sell their technology to major purchasers with deep pockets, then rely on the velvet hammer approach – which is access to those buyers – to get suppliers in,” said Jon Derome, an analyst at The Yankee Group in Boston.

“But that velvet hammer approach has so far worked only for the first-tier suppliers,” Derome said. “The point we’re at now is to take the next level of suppliers online.”

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