Open APIs: An indispensable link to customers

Public APIs let customers connect to you in new ways, but the interface must be easy for outside developers to work with.

When Neil Fantom, a manager at the World Bank, sat down with the organization's technology team in 2010 to talk about opening up the bank's data to the world at large, he encountered a bit of unfamiliar terminology. "At that time I didn't even know what 'API' meant," says Fantom.

As head of the World Bank's open data initiative, which was announced in April 2010, Fantom was in charge of taking the organization's vast trove of information, which previously had been available only by subscription, and making it available to anyone who wanted it. The method of doing that, he would learn, would be an application programming interface, or API.

The API would put thousands of economic indicators, including rainfall amounts, education levels and birth rates -- with some metrics going back 50 years -- at the disposal of developers to mix and match and present in any way that made sense to them. The hope was that this would advance the bank's mission of fighting poverty on a global scale by tapping the creativity of others. "There are many people outside the bank who can do things with the data set we never thought about," says Fantom.

One developer, for instance, created an app that married the bank's rainfall data to Google Maps to estimate how much rainwater could be collected on rooftops and subsequently used to water crops in different parts of the world. Another app provides facts about energy consumption and shows individuals what they can do to fight climate change.

Fantom and the World Bank aren't alone in such pursuits. A decade ago, open APIs were a novelty, but in the past few years they've been put to use at an accelerating rate. ProgrammableWeb, a website that tracks public APIs, listed more than 8,800 in early April. According to the site, it took eight years, from 2000 to 2008, for the number of APIs to reach 1,000, and then just another 18 months to hit 2,000. The jump from 7,000 to 8,000 took just three months.

The APIs cover a wide range of categories, including business, shopping, messaging, mapping, telephone, social, financial and government, according to ProgrammableWeb. They're becoming as necessary to an organization as a website. "In business today, an open API is more or less table stakes. It's something you have to have," says Stephen O'Grady, an analyst at RedMonk, an analysis firm that focuses on developers. "Increasingly, your traction is going to be driven by how open and how programmatically manipulable your product is."

An Evolving Model

When Best Buy first launched its API, BBYOpen, in 2009, it gave developers access only to the chain's products catalog, with descriptions and prices for all the items it had on sale, in the hopes that doing so would bring in more customers. That was part of a deliberate strategy to start slowly, says Steve Bendt, director of emerging platforms at Best Buy. "We had to prove these things over time," he says. "We started to prove out that this is a very vibrant and viable area to pursue."

But external developers wanted more, so the company added the ability to access reviews and ratings for products, find nearby stores, check whether certain products were available at particular stores, and purchase items through the website via mobile app, perhaps with a single click if the user had linked a credit card to the app.

It's been a hit. The mobile apps ShopSavvy, RedLaser and Milo all use BBYOpen. The makers of the app get a commission on sales through Best Buy's affiliate program. Shoppers can search for an item, or scan a bar code, and get information on pricing from various sellers.

Of course, that could mean that a customer using the app might wind up buying from a Best Buy competitor, but Bendt says that since websites and mobile apps have changed how people shop, what's important for Best Buy is to be in the mix. "If we're not in the consideration set, that's a missed opportunity." And the fact that the API makes it possible for people to find out if products they've purchased are available for pickup at nearby stores helps give Best Buy a competitive edge over online-only retailers, he says. "Now you can search for, buy and pick up within a matter or 20 to 40 minutes," says Bendt.

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