The Rise of APIs in Retail - Better Data, Better Business

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Mall representing APIs in Retail

Retail is a challenging industry. It is constantly evolving to reflect consumer preferences in product selection – but that is only part of it. As more people turn to online shopping, many retailers are using application programming interfaces (APIs) to remain competitive. Consumers have certain expectations of technology, so implementing digital transformation and APIs in retail has become less of an option and more of a requirement to attract and retain the modern customer.

In this article, we look at APIs in retail, explore the drivers for implementing APIs, and some of the benefits of using APIs and emerging trends in retail APIs.

APIs in Retail and Digital Transformation

Over the last 20 years, the retail industry has evolved to feature online shopping and e-commerce, but the progress has not been linear. Retailers embraced backend systems that fulfill specific needs, like a point-of-sale (POS) system, inventory management systems, and customer relationship management (CRM) – but these programs generally do not integrate with each other.

By consolidating data, APIs in retail bridge that gap and reduce disruptions throughout the buyer journey. They help businesses be more efficient, but they also make it easier for them to innovate.

Drivers of APIs in Retail

Generally speaking, retail companies are looking to resolve specific problems by leveraging APIs. Understanding these drivers can help you identify the roles that APIs in retail play and develop an API strategy that offers tangible benefits. According to research from IBM, companies that are most successful in implementing APIs focus on one or more of the following business drivers.


Speed is one of the top drivers for API initiatives; in any company, different aspects of the business run at different speeds. For example, IT may function outside of overall business operations, and marketing may exist separately from sales. When something in the system changes, it can overwhelm operations and introduce security risks. Through APIs in retail, you can control changes and prepackage certain assets so that each department gets the information they need.


Reach is also a vital driver of APIs in retail. The technology can expose opportunities for growth by tapping into new markets. An example of this could be an airline partnering with a luggage company to send targeted ads to customers with upcoming trips.

Internet of Things

The Internet of Things (IoT) has meant that devices can be sources of data in addition to the other information collected through online shopping. Integrating these data sources can produce interesting solutions, such as a targeted ad that displays on a shopping cart equipped with a screen or a company tracking how shopping carts move through its stores (e.g., where people walk, where they stop).


Within APIs in retail, domains – a word for interactions across business lines – can provide important data about customer buying behavior. They can determine whether certain products are more likely to be bought in-store than online, how often a customer visits an in-person store to buy something in their online cart, and analyze how this behavior changes by location.

Discover how the DreamFactory API platform helps beverage company Monin unifies the data it collects.

Benefits of APIs in Retail

APIs in retail can accelerate innovation when used correctly. According to recent research from Google, over half of all retailers say that APIs enable companies to scale digital assets, while roughly 36% say that APIs create business value – and that percentage will only grow as more consumers grow accustomed to the benefits ofAPIs in retail. Retail companies that employ API solutions often realize the following benefits.

Integrated Payment Methods

One of the most popular uses ofAPIs in retailis in payment methods, both in-store and online. While most companies can accept credit cards or cash, APIs enable customers to pay with less traditional forms of currency, like Apple Pay or Bitcoin.

Personalized Customer Experience

APIs can power personalized experiences by connecting customer data with store location and business intelligence. While this can include personalized recommendations based on consumer preference or past purchases, it can go much further to include smartphone alerts or special sales when someone enters a store.

Improved Communications

APIs in retail can streamline communications by pulling together internal data with external data. For example, an online retailer could offer customers real-time shipping statuses through its website, then offer a special deal if the package is delayed or provide recommendations for complementary products once the package is delivered.

Boosted SEO Performance

Retailers can improve their SEO performance by using APIs. For example, the right API could automatically collect keyword research and track the performance of specific phrases, then layer that information with consumer location data. Over time, this information can inform a retailer’s SEO strategy and possibly uncover growth opportunities.

Foster Omnichannel Shopping

APIs in retail can also improve the in-person shopping experience. Retailers can use APIs to provide recommendations as a customer moves through a store, answer product questions in real-time, or support self-checkout.

Employing APIs in Retail

When it comes to APIs in retail, the question isn’t whether you should implement the functionality – but how you can use APIs as part of your retail strategy.

Here are some of the top APIs in retail trends:

Borderless Channels

Implementing borderless channels, or creating a channel-less experience, makes e-commerce shopping effortless. Interacting with your brand becomes very natural when customers can do things like buy a product from your social media or give salespeople data on customer history and preferences.

Intelligent Merchandising

APIs can also make merchandising more interactive by informing business models and predicting customer needs in real-time. An example of this customer journey in practice could be targeting customers who have bought a coffeemaker with ads or sales for coffee pods.

Virtual Shopping Experiences

APIs in retail support virtual shopping ecosystems that go beyond a simple online shopping website to true customer engagement. For instance, a retail company could let consumers know what they have purchased in the past, recommend products that go with past purchases, provide sneak peeks at what is coming through the supply chain, or present customers with personalized homepages.

Getting Started with APIs

The future of retail is APIs. They play an increasingly pivotal role in meeting customer functionality expectations and preferences – but you need a partner who can help you develop an API strategy to get there. DreamFactory makes it easy to get started. DreamFactory has an easy-to-use platform for API creation that doesn’t require technical expertise to build APIs that provide a competitive advantage and fit your needs with built-in security controls.