What is product taxonomy and how to leverage it in ecommerce

Imagine this: You’re walking into a department store, and you want to buy a pair of boots. Naturally, you’re looking for the section with shoes. Once you get to this shoes section, you can easily find the boots you were looking for. However, what happens if the department store isn’t divided into product sections? What if, for example, they put your boots next to the midi dresses?

Would it be easy for you to find them? Probably not. Instead, you’d lose a lot of valuable time looking for the boots in the unorganized department store. You’d probably be annoyed because things are so complicated.

Why product taxonomy matters

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Online store experiences mirror real-life shopping. 

Even though it seems like everything’s much simpler online, when products are mixed up, it’s challenging for users to find what they need. Forrester’s study showed that "poorly architected retail sites" only sell half as much as better organized sites. 

Your site categories and navigation directly impact your bottom line. When shoppers visit your e-commerce store, they expect to see product categories and sections that will make it easy for them to know where to look for a particular item. If they are looking for a dress, they will look for it in “women’s clothing,” and then “dresses.”

It would be odd if you put dresses in “men’s footwear,” for example. That’s where product taxonomy comes in. Organized product taxonomy helps visitors navigate through categories and find the products they want.

Product taxonomy definition and hierarchy examples

The word taxonomy comes from the Greek word taxis, which means arrangement. Taxonomy stands for arranging, categorizing, grouping, and also recognizing the meaning behind the classified items. In other words, product taxonomy is a systematic way to categorize, organize, and classify products in ecommerce stores often referred to as ecommerce taxonomy.. 

A hierarchy in which items are classified by use or context (like women's clothing or party dresses) into narrow subsets is the most common taxonomic model in e-commerce.

Here’s an example: 

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Presenting the product catalog in segments like above makes it more manageable for shoppers to find what they want and promotes logical connections between subsets.
For example, if the desired product is a red dress, the categories would be:

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You can also have other sub-categories, like evening dresses, casual dresses, silk dresses, short dresses, long-sleeve dresses, etc. What is essential is that they are logical and based on your understanding of customer behavior. 

A good retailer should not just put a few categories that sound good together. Your product categories should make sense to the customers, making it easier for them to reach the checkout page.

How artificial intelligence affects product taxonomy

Data science and artificial intelligence (AI) are technologies that are making taxonomy better and smarter. AI enables ecommerce businesses to automate and simplify different processes.

Competitive companies have started to leverage AI in different ways, including implementing AI solutions for fashion resale to optimize product tagging and improve customer experience.:

• Identify user profiles and the products shoppers are interested in to serve recommendations based on buyer behavior

• Automatically generate product descriptions and content. For example, Facebook’s GrokNet has the ability to detect and describe the products in pictures and therefore help sellers sell them on the Facebook marketplace. 
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• Overcome the vocabulary gap, ensuring every shopper can find what they want, regardless of the differences in the words they use when describing the same product. 

The role of automatic tagging in creating a painless taxonomy process

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Online stores and fashion marketplaces with catalogs that have thousands of products need intelligent systems that can replace manual taxonomy creation processes. Automatic tagging is an AI-based alternative for manual product tagging. This is essentially a method that creates catalog asset metadata. It’s a crucial part of creating a structured and searchable catalog based on fashion taxonomy. The automatic tagging system’s foundation is trained AI algorithms that can recognize clothes in pictures just like we humans can do.