How APIs are Changing the Future of Retail

One of the themes at last week’s APIdays in Paris was a look at the disruptive force APIs are having across a range of industries. Music, for example, is one vertical industry that is being fundamentally altered by technology, giving rise to new patterns of consumption. Now, with the potential offered with APIs, the music industry is evolving further and creating new ways of tunes connecting with our day-to-day lives.

APIs are having a similar impact across the retail industry.

Martin Möllmann, Product Manager at Sphere.io, spoke at APIdays about how retail is continuing to undergo a massive transformation — driven in part by APIs.

Commerce APIs

“There are already advanced APIs in the retail space,” says Möllmann, pointing to the 1,980-plus APIs listed in commerce-relevant categories of ProgrammableWeb’s API directory. Möllmann described how various API categories are all enabling retail businesses to grow:

  • Shipping APIs: enabling delivery tracking
  • Taxation APIs: enabling global retail as businesses automatically charge the right tax rates for customers, or help retailers file the right tax reports
  • E-commerce API platforms: enabling businesses to establish a direct channel to shoppers from their product catalog and shepherd them through to online sales and delivery
  • Payment APIs: enabling smart, secure, performant solutions for online checkout workflows

One of the key themes of Möllmann’s talk was that retail continues to change fundamentally, and that process of evolution will only speed up as APIs drive innovation. Already, Möllmann notes, “we don’t talk about web commerce anymore: retail needs to prepare for shopping devices.” Möllmann gives the “Internet of Things” example of an internet-enabled fridge that would automatically refill itself and order replacement products via API without humans needing to write out a shopping list or scan barcodes or make voice requests.

It is a turning point that Möllmann seems to indicate Sphere.io, as a company, is grappling with themselves. Principally, Sphere.io still identifies itself as an e-commerce platform that provides a series of composable widgets with the Sphere.io API that enables features that customers can use to build their own e-commerce store (along the lines of competitors like Shopify, Magento, and BigCommerce). But new wording has recently been added to the home page that notes that what they do is provide API tools to drive retail in any environment: on mobile devices and smart phones, on wearables, and at any point of sale. The Sphere.io website now reads: “You can call it Software-as-a-Service or Platform-as-a-Service. We call it Cloud Commerce OS.”

APIs to Facilitate New Shopping Trends

This is a reflection of the same trends that leaders in retail are trying to understand. Jim Crawford, Chief Experience Officer for Chute Gerdeman, a leading retail design and branding firm based in Columbus, Ohio, was recently part of a panel on retail engagement hosted by the Platt Retail Institute’s Margot Myers.

Crawford described the flux that is facing the retail industry at the moment. He described how the year 2000 started out with everyone thinking e-commerce would be the solution, that physical stores would practically dissolve in favor of the convenience of online shopping. Instead, a more complex and culturally sophisticated view of retail has emerged, as retailers have discovered that while shoppers enjoy the physical shopping experience, their expectations have changed. Shoppers can do their own research online but still feel an emotional connection to a brick-and-mortar store; retail has become more an interactive experience, which is enabled by online and mobile, but still involves a physical environment.

“We still don’t have designers who understand how to integrate technology alongside other different elements of design,” Crawford told the retail engagement panel earlier this year. Crawford continued:

“We have watched our business evolve over the years from designing stores — being set builders — to now where we’re putting on the whole play. We’re responsible for working with the retailer to write the story, to create the script, to cast the roles, even down to figuring out if it is a short one-act play or something that’s going to be on Broadway for 10 years. It has really changed the nature of our business because figuring out how to pull all these pieces together, measure the right things, and adapt accordingly has become the wave of the future.”

Sphere.io wants to be the resource platform that enables retailers to reconceptualize the experience they create for shoppers.

Wearables as “Customer Interface Technologies”

Möllmann sees wearables as being the next wave that will hit retail in the quest to better understand how to design in-store and mobile services that leverage the power of APIs to create the new experiences that Crawford talks about.

The Platt Retail Institute also released a research paper on future retail trends, co-written by communications firm Two West. The Future of Retail: A Perspective on Emerging Technology and Store Formats Report groups wearables alongside kiosks and other in-store devices as “customer interface technologies” and identifies eight ways — powered by APIs — that they will alter retail:

  1. A shopper’s access to information will be unlimited and provided in context by stores able to sync with the shopper’s wearable device(s) at any time.
  2. Big data will use shopping histories, personal preferences, and contextual information alongside consumer trends to deliver a personalized experience to every shopper.
  3. Some merchandise items will be suited for mass-personalized production and provided on-the-spot.
  4. Some products will be sold via price bidding and influenced by customization of the product, rather than having set prices.
  5. Products and packaging will include interactive technologies themselves similar to shopper’s wearable device(s).
  6. IoT sensors will better track movements and analytics that will feed into understanding the retail experience at a nuanced depth.
  7. Technologies that allow recognition of individual customers — like facial recognition APIs — will be used in-store.
  8. Payment, voice, and social media APIs will be adopted broadly, facilitating payment processing anywhere in a store.

“We are building new shopping experiences in weeks, not years,” Möllmann said. He spoke of a recent API hack that took six days to build the whole demo: a Google Glass API-driven integration that enables any product to be scanned by QR or barcode for an automatic order. Using Angry Birds Star Wars Edition toys as an example, Möllmann showed on the APIdays stage how he could look at a product, scan its barcode, and request to buy it. This would automatically update a backend product catalog, noting the purchase and the buyer.

While the demo at APIdays was a bit clunky, it did serve to show how many of the above themes identified by the PRI report come into play. Instant information, the ability to customize and order, using personal identification technologies, and payment APIs could all come into play to create this type of retail experience in the future. To hasten that new dawn, Sphere.io has released the demo source code on GitHub to enable other projects with a similar value supply chain to be imagined and created quickly.

“This is the future, this is what it is all about: embedded devices that are connected to our daily life,” Möllmann told the APIdays audience.

Mark Boyd is a ProgrammableWeb writer covering breaking news, API business strategies and models, open data, and smart cities.

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