There’s quite a lot of attention now on digital transformation, the growth engine of the new economy. Competing with pure digital businesses like Netflix, eBay, and Google over the last decade has caused businesses in every sector to extend their use of digital channels. This transformation involves converting products and services to digital form so they can be used as digital services. Alternately, some products and services were scrapped entirely and replaced by new ones supporting an updated business model.
This digital shift is happening everywhere, but you might be missing just how pervasive the trend is. Take a look at some of the consumer brands you encounter in daily life:
- Your Under Armour running shoes may be digitally enabled and linked to your smartphone’s MapMyRun mobile app to record your workout. This data, stored in the UA cloud, lets your app track your fitness, and UA to track your mileage—and potentially put the right offer for new shoes in front of you in the right context, maybe during your workout.
- You might follow a Comcast’s Xfinity broadcast of a workout show, but often miss it at air time. No worries, the Xfinity app on your iPad can tune your TV remotely to record the show for later viewing.
In both cases, these companies have expanded and extended the customer experience through adding a digital component. They’ve found a way to share data and integrate physical and digital assets to attain a better understanding of customer use and preferences, while simultaneously delivering greater convenience and an improved experience.
The Power of APIs
What enables this shared data and integration is APIs. Under Armour’s MapMyRun APIs don’t just power the workout activity log, they enable the inclusion of third-party content such as running route maps from Apple, friends’ social posts from Facebook and Twitter, and group challenges from the NBA, Michelob, and other sponsors.
Content and interactions could grow even broader with tie-ins to sporting events and real-time sports data from the Stats API. This would require API calls, and as you might imagine, the scale can get HUGE. At CES last month, Under Armour CEO Kevin Plank stated that in the short time they’ve been building their community of healthy lifestyle consumers, they’ve amassed 160 million registered users, and in a single day last month recorded 190 million downloads of one of the MapMyFitness apps.
Multiplying 160 million mobile app users by all the API calls invoked for each action of the mobile app produces a tidal wave of data that must arrive instantaneously with very low latency, whether the user is in Hong Kong or New York. Likewise in the Comcast example, the APIs must scale and be secure to ensure the best customer experience.
TIBCO Mashery provides the globally deployed network and multi-tenant SaaS API management platform that enables customers like Under Armour and Comcast to achieve success with their APIs. But Mashery does not just provide scale and security. If you check out the developer portal for Under Armour you’ll find a beautiful extension of their brand and self-service key provisioning and registration for quick and easy adoption of their APIs by internal and external partner developers. The ease with which Under Armour APIs can be accessed fosters greater use and innovation by a community larger than the company and its traditional partners. It extends capabilities to any third party who might make use of it to create a mashup of their own. And to tie-in with Stats.com, the same API key can be used anywhere in the Mashery API network thanks to the multi-tenant SaaS platform. TIBCO Mashery provides these capabilities as a turnkey cloud service for API distribution.
The Power of the API Economy
Playing in the API economy, companies can leverage a very large community beyond the traditional market reach of their own direct sales organizations or distribution channels. They can use the confluence of social media, mobile technology, analytics, and cloud capabilities to target every app in every market and enable every developer to help grow it. In more than 10 years of SaaS operations, Mashery has served more than 350,000 developers, more than 300 companies, and today manages more than 30 billion API calls per month.
Companies are leveraging Mashery to transform their products, and sometimes their entire businesses, into platforms for the digital age. It’s one thing to sell a product or service, but when you allow those products and services to be extended by the larger community or used in unrestricted combinations by the community, you get a multiplier effect. Think of what you could do with cellphones 15 years ago. Now, think about what you can do with a smartphone and access to the app marketplaces of Apple and Google. APIs provide the channel to participate in the digital marketplace.
But what is the digital marketplace, and it is worth building an API to participate in it? Examining the characteristics of existing open APIs may provide part of the answer. Today, the number of public, open APIs is around 12,000, yet many more are private and only shared within private ecosystems. As many open APIs as Mashery powers, the vast majority of Mashery-enabled APIs are private and without a public portal.
An interesting visual analysis of the open API ecosystem was published recently by Peter Evans and Rahul Basole in Communications of the ACM, published by the Association of Computing Machinery. The authors examined the concentration of open API providers by industry sector, and the number of mashups built on those open APIs. They found the data clusters around ecommerce, social media, job search, online retailers, and other digital-native businesses; traditional brick-and-mortar businesses are more at the periphery of the network plot.
The use of APIs in mashups shows the level of interconnectedness of Amazon versus Wal*Mart, and the difference is astounding. It shows the dominance in the digital marketplace, and that it’s done through third-party use of the Amazon API in mashups. In another way, the visualization shows the powerful multiplier effect of the affiliate model in digital marketplaces. Who knows, standard financial reporting may soon include network graph statistics like degree of distribution, centrality, and cohesion to measure market reach and company performance of digital channels.
Where Do You Start?
Consumer brands like Under Armour and Comcast are well down the path of digital transformation and enablement of digital business platform strategies. They understand the force-multiplier effects of platforms enabled by APIs. But how can a business that doesn’t have an API yet embark on its own digital transformation?
It begins with leveraging the data and assets available within and outside of the enterprise. Each company has a unique starting point and a unique set of strengths and weaknesses because of their history, IT landscape, industry, and business model. Leveraging these assets will involve integrating data and events across applications, systems, and databases of all forms and structures such as tuple, document, relational, graph, and others. It will involve correlating real-time data and events to create a 360-degree view of your customers and their context to make in-the-moment decisions—and do this at the speed and scale of your business.
For example, suppose you’re a retailer and you’ve exposed your product catalog via an API. Your API traffic is building, and you see an opportunity to cross-sell products or increase engagement through targeting and discounting based on customer behaviors. Using real-time event processing to update a shared, distributed cache, your API can access more relevant and timely information, while also scaling to meet demand.
TIBCO’s event processing and distributed cache technologies have been used in precisely this way in many implementations over recent years. They offer a compelling solution for an API backend that must retain transactional integrity and simultaneously scale for reads and writes serving a torrent of API traffic.
The Fast Data Architecture graphic shows a conceptual view of how APIs are supported by a backend built with intelligent technologies (event processing) using an in-memory distributed-cache.
API creation is based on data within and beyond your enterprise. It requires access to enterprise apps as well as new SaaS applications, and it’s best done through proven technologies of integration and event processing. Once an API is created, it can be taken to the digital market through an API distribution platform for scalability, security, and rapid adoption using a self-service developer portal.
To learn more about the power of APIs in the cloud and the importance of API distribution, checkout the on-demand webinar, Agility and Value with API Exposure and Cloud Integration.