MDM – what is it and how does it work?
- MDM – you need to know this:
- MDM – what is it, what is the definition and essence
- How MDM Works – Processes and Architecture
- PIM system, or specialized "product MDM"
- Facts and Trends – Why Companies Are Investing in MDM/PIM Now
- Pimcore, or one platform, two worlds – PIM and MDM
- When to start with PIM, when with MDM, and when to combine?
- Two practical architecture patterns
- How to start – discover the implementation path that minimizes risk
- Summary
- FAQ – Frequently Asked Questions
In a modern organization, data flows through dozens of systems – ERP, CRM, WMS, e-commerce – with each of them often being a so-called local source of truth. This is a straightforward path to duplicates, discrepancies, and errors, which translate into business decisions. That is why companies implement master data management, a consistent way of managing key data that restores a single reliable view of customers, products, suppliers, or locations. From the perspective of a PIM systems integrator, we are particularly interested in the area of product data, where classic MDM meets specialized PIM (Product Information Management).
MDM – you need to know this:
- MDM (Master Data Management) is an approach to managing a company's key data (customers, products, suppliers), ensuring their consistency, quality, and availability.
- PIM (Product Information Management) is a tool focused on product content and its distribution – it can be considered as "product MDM".
- MDM and PIM complement each other: MDM creates a unified database at the organizational level, while PIM provides detailed product information ready for publication.
- Benefits of implementation include, among others, better business decisions, faster time-to-market for products, and lower costs of poor data quality.
MDM – what is it, what is the definition and essence
Master data management – what is it? By definition, it is a set of roles, processes, and technologies aimed at ensuring the quality, consistency, and availability of master data throughout the company. In practice, it involves establishing the so-called golden record for each key entity – customer, product, supplier, or location, and distributing this agreed version to all systems. The acronym MDM stands for the English term – master data management, which emphasizes that we are talking about basic, non-transactional data.
MDM – what is it? It's not just an application, but also data governance:
- domain owners,
- quality rules,
- control of changes and responsibilities.
- In mature organizations, these elements work together and are enforced throughout the data lifecycle.
How MDM Works – Processes and Architecture
Implementing MDM involves building a central hub that consolidates data from multiple sources and distributes it further. Such an MDM system integrates with ERP/CRM/WMS and other applications via API or ETL/ELT, cleans and standardizes data, removes duplicates, creates golden records, and then synchronizes consistent data to all recipients. As a result, changes (e.g., price lists or product attributes) are made once, and the business benefits from unified information.
The most important tasks of MDM in practice include, among others:
- integration and consolidation of distributed data;
- identification and merging of duplicates;
- standardization and enrichment (formats, units, dictionaries);
- quality validation (completeness, correctness, consistency);
- creation and distribution of gold records.
In terms of architecture, MDM can operate operationally (updates transactional systems), analytically (feeds the warehouse/analytics), or in a hybrid manner. The key is integration and governance – without them, no technology will maintain order.
PIM system, or specialized "product MDM"
In the area of product data, the role of a specialized hub is fulfilled by PIM. This tool is used for centralizing product information (technical attributes, descriptions, multimedia, translations) and distributing it to multiple channels (store, marketplace, catalog). One could say that PIM is a "product MDM": narrower in domain, but very deep in terms of content and publishing functions. As a result, it shortens time-to-market, enhances consistency, and reduces manual work.
Differences between PIM vs MDM – in a nutshell:
- Scope – PIM = products; MDM = multiple domains.
- Purpose – PIM – rich content and publication; MDM – harmonization and cross-sectional consistency.
- Users – PIM – marketing/e-commerce; MDM – management, operations, IT, analytics.
- Complexity – PIM is implemented more quickly; MDM is a broader transformation.
Read the full comparison! You can find it here:What is the difference between a PIM system and an MDM system
Facts and Trends – Why Companies Are Investing in MDM/PIM Now
The master data management market is growing at a double-digit rate – from approximately USD 16.7 billion in 2022 to USD 34.5 billion in 2027 (CAGR ~15.7%). Cloud variants are growing even faster (~18% year-over-year 2021–2026). Gartner estimates the cost of poor data quality at USD 12.9 million annually per organization, and Forrester points to improved team collaboration thanks to multi-domain MDM. In PIM, the importance of AI and analytics, the so-called digital shelf, is increasing, and Gartner/Forrester reports show a trend towards solutions supporting multiple data domains on a single platform.
Pimcore, or one platform, two worlds – PIM and MDM
Pimcore as PIM
Flexible data modeling (variants, sets, relationships), translations, workflow/versioning, DAM, mass editing and exports to channels (e-commerce, marketplace, catalogs). This is a center for product content ready for publication.
Pimcore as an MDM system
The same installation can store other domains (providers, locations, partners), maintain relationships between them, and synchronize data with ERP/CRM/e-commerce via API and integration extensions. In practice, Pimcore as an MDM system connects product data with other domains and maintains their consistency throughout the entire ecosystem.
Pimcore has very good user ratings (including Capterra, G2) and has been recognized in Gartner Peer Insights (Customers’ Choice) in the MDM category. Although it does not always appear in the main Gartner/Forrester quadrants (due to revenue thresholds and the open-source model), in real implementations, it effectively competes as a flexible PIM/MDM platform with good TCO.
When to start with PIM, when with MDM, and when to combine?
- Start with PIM if the biggest problem is chaos in product data (attributes, descriptions, multimedia, translations) and publishing to multiple channels.
- Start with MDM if discrepancies affect multiple domains simultaneously (customer, product, supplier, location) and impact reports or operations.
- Combine PIM + MDM if you want to simultaneously maintain rich product content and cross-sectional consistency (e.g., reports combining product sales with customer segmentation).
Two practical architecture patterns
PIM-centric + integration to MDM
PIM consolidates and enriches product content, and selected "master" attributes go to MDM and are linked with other domains. Advantage – quick results and "depth" of content without losing consistency.
MDM-centric + Product MDM module + PIM for content
The MDM system maintains the "skeleton" of data (ID, classifications, basic attributes), PIM is responsible for rich content and publication. Two-way synchronization maintains the pace of changes and order.
How to start – discover the implementation path that minimizes risk
- Audit of domains and priorities (where the greatest pain and business risk are).
- Data model and governance (what is a master, quality rules, roles and responsibilities).
- Quick victories (visible flow: e.g., implementation of a new assortment "from source to publication").
- Integrations and automation (API/connectors; manual CSV only in emergencies).
- Quality metrics and ROI (completeness, consistency, time from change to publication, conversion).
Summary
MDM and PIM do not compete – they complement each other. Master data management provides a unified base of trusted data across the entire company, while PIM ensures rich product information ready for publication in all channels. Together, they translate into better decisions, faster go-to-market, and consistent customer experiences. And if someone asks about mdm – what it means in practice – the answer is short. It is the foundation of informational order, without which a scalable, digital business is difficult. The mdm system often acts as the glue of the entire architecture, and Pimcore allows the implementation of both PIM and MDM in one flexible environment.
FAQ – Frequently Asked Questions
The PIM (Product Information Management) system is specialized in managing detailed product information (e.g., descriptions, photos, translations) and distributing it to sales channels. On the other hand, MDM (Master Data Management) is a broader approach that harmonizes multiple domains of master data across the company (e.g., customer, product, and supplier data). PIM is best when the main issue is chaos in product data, whereas MDM is needed when discrepancies affect many business areas.
The MDM system affects performance by creating a so-called golden record, which is a single, consistent, and reliable version of data that is synchronized across all systems (e.g., ERP, CRM, WMS). This eliminates duplicates and errors, reducing the time needed to implement changes (e.g., in price lists) and ensuring that all departments work with the same, up-to-date information.
Pimcore is a flexible platform that combines PIM, MDM, and DAM (Digital Asset Management) functions in one environment. This allows companies to manage not only product data but also other domains (e.g., supplier or location data), maintaining their consistency across the entire business ecosystem.
Gartner research estimates that the cost of poor quality data averages 12.9 million USD annually per organization. Investments in MDM and PIM systems aim to reduce these losses, as they ensure consistency and accuracy of information, which translates into better business decision-making, improved collaboration between departments, and faster product launches.