APIs in Retail Part 1 – What are Retail APIs and How do They Affect Me?

There is a lot of buzz around “APIs” but what are they exactly?   An API, which stands for application programming interface, is meant to integrate two software components together to share functionality of data.  It’s usually a point to point intentional integration available only to people with the right key.

So how do they impact the retail industry?  How do they affect you as a customer?

API is more than just a technical solution.  API in short is something you offer up as a brand, or service, as well as a means to programmatically integrate two formerly unlinked data sets.  This allows retailers to build new business models outside of their original intentions.

Retail APIs include catalog, product search, order submissions, inventory, recommendations, in addition to a multitude of retail specific business lines.  Traditionally a retailer would not have shared this information.  There was no need, as brick and mortar shopping was the primary channel.  As online shopping developed, retailers’ IT departments were overloaded creating their own closed door APIs to serve customers.

Open API allows retailers to open their inventory and data to the whole world.  Anybody can become an affiliate and query any of the products retailer has in its catalog – provided that retailer shares its API key.

So when you shop online, you are using multiple APIs simultaneously.  When you search for an item, you are using the catalog and inventory APIs.  If you scroll down on that page, you see “items you may like” thanks to the recommendations API.

When you click “place an order,” you use the order submissions API, which uses a geographical API in conjunction with a courier service’s API to calculate your shipping fees.  When you enter your payment information you use a payment API which communicates with your credit card company to check for sufficient funds.  All of this happens in near real time.

Without retail APIs, online shopping would not be the seamless transaction it is today.  The APIs work together as an ecosystem to deliver the “point-click-order” process we have grown so accustomed to today.

Want more? Click here for part 2

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