The retail industry is a bellwether for digital transformation: Traditional retail business models were amongst the first to be disrupted by digital alternatives. This maturity means that consumers have never had it so good: We enjoy a wide range of shopping channels and benefit from compelling data-driven experiences.
In 2016, the watchwords for retailers have been service, convenience and speed; and retailers who have failed to make the most of the opportunities offered by digital are at risk of being left behind. That’s why the retail sector is today characterised by continual transformation—transformation enabled by open Application Programming Interfaces (APIs). The opportunity here is not only to use API’s to connect the online experience, but also to be able to tie this back to the instore experience. Retailers know very well that great service irrespective of channel has to be fast and seamless.
Amazon was one of the first companies to digitally disrupt the retail sector. Yet it’s not once rested on its laurels and is continually looking at new ways to enhance customer service. This can be seen in its Amazon Now service.
Amazon Now takes its lead from food delivery services such as Deliveroo. But Amazon Now goes further, offering over 10,000 products for low cost, one-hour delivery. While the service is currently only available in selected cities, it’ll no doubt scale up quickly. As Amazon further expands the capabilities of Echo, its voice activated speaker/shopping assistant, there’s also the potential it will encourage more impulse purchases from the home: It’s never been easier to buy a product, and the time between purchase and delivery has never been shorter.
Innovation isn’t limited to online. Stores like made.com have realised that people still like to physically touch products before buying them, and so have set up bricks and mortar showrooms. The purchase is still made online, and the supply chain works in the same way as with a regular online purchase. The success of such approaches is to recognise consumer behaviour, and optimise the sales journey around this, rather than trying to force shoppers down a contrived path.
The role of APIs
Disruptive retailers like Amazon and made.com are successful because they gather data on customers and use insights from this data to inform business decisions. made.com, for example, not only sees which of its products are most interesting to customers online, but can also solicit more direct information instore. This data can then be used to improve service, convenience and speed.
If retailers are to use information in this way they need to have in place an essential link: APIs. APIs allow applications to seamlessly connect with business data, functionality and services. They also act as a fast lane that help speed up data connections across the retail enterprise, to ensure compelling products are developed (i.e., ones informed by analysis of customer data) and reach market faster.
Key to the success of embracing APIs and Open Business is ensuring an organisation’s back-end infrastructure and operating platform are fit for purpose, and ready to be opened up externally. Accenture has recently undertaken such backend work at an airline that needed a robust and future proofed architecture that would be the basis for their entire data transformation. This led to an entire re-engineering of their internal architecture in preparation for APIs, meaning they have now been able to on-board customer digital journeys much faster, with a more efficient process.
Retailers who understand the new economy lessons know that the speed with which you can pivot and react is key for survival. By connecting key parts of their business together using newer API driven technology, they are better placed to understand the changing market, and ultimately provide the products and services their customers want.