How Best Buy, Netflix Overcame the iPad Challenge

By  Oren Michels, Mashery CEO
The iPad is not just a hit device. It changes the Internet, with new challenges and opportunities for retailers to be successful. The iPad is personal, portable, and pretty, with rich graphics, wireless connection and location services. It offers lots of third-party applications, like videos, news, games, even recipes you can access while shopping. Instead of one big Internet, everyone gets their own Web of stuff, people, expertise and thrills they want, right now.

While the introduction of the iPad is great news for consumers, it brings a host of new challenges for retailers who thought they had this Web thing licked. With an abundance of new applications, the Web is no longer something you build for "out there," it's brought into your store, via the iPad (don't be surprised if wireless signal strength becomes part of rental agreements). Suddenly, multi-channel takes on a new meaning as online and physical morph from two parallel channels consumers hop between to one mixed channel accessed simultaneously.

The new Web means retailers need catalogs that show full product availability and styles, for immediate in-store gratification. Savvy customers will link to product review pages, or even write their own, and message their friends for advice. Stores can stand by and let this happen (do not pretend it is not going to happen) or participate. In-device videos can be used for product display, employee training, or navigating the mall to find friends.

Objects are linked in this evolution of the Web too, offering all kinds of new retail strategies. Without skipping a beat, retailers can offer group service plans for tech devices popular in a social network. For example, once a customer purchases a dress, they may receive a link to fashion accessories or coupons for a nearby store. Retailers can even offer custom Web applications, like linking a hotels review guide with a luggage purchase, or an in-store 3D video combining different furniture choices with pictures the consumer took of her living room. While many of us have been painting pictures of this futuristic scenario for some time, the advent of the iPad brings realization that much closer.

But now that everything is available everywhere, how will retailers get their message, products and services to consumers? Most companies won't be able to do it -- at least not the way they have been traditionally.

As part of their business, companies like Apple work with millions of software developers around the globe who are skilled at building new products and services in coordination with existing businesses. While these developers all offer expertise within certain platforms, programming languages, devices and/or markets- success requires access to corporate catalogs, product information or data. While some developers work internally, others are partners, and many of them are people that the retailers may never meet face-to-face.

Web-savvy developers and retailers looking to get to the "anytime, anywhere" Internet meet through something called an API. Also known as an Application Programming Interface, an API provides a secure environment for facilitating content between retailers and developers to enable them to build innovative applications that drive sales and offer enhanced consumer interaction on the Web. Third-party sites, like Mashery, broker these relationships to ensure retailers' information is protected, while delivering content the developers need to bring retailer content to consumers in new ways. The broker site gives both parties reports on things like performance, availability, and what's hot.

Best Buy used Mashery to find an unheralded in-house developer, who remade their store catalog to show what products are available for immediate purchase at nearby stores. Accessing the same API, another third-party developer with no connection to Best Buy spent a sleepless night coding a video sharing directory that links directly to Best Buy's products.

Netflix also opened up its catalog via a Mashery powered developer portal and had applications ranging from catalog access via the Xbox to leading iPhone applications all created in record time. Etsy, a marketplace for connecting buyers to individual sellers of handmade goods leveraged an API program resulting in tools for both buyers and sellers- everything from color matching buying apps to seller integration with leading social media applications.

The iPad is just the beginning. Expect tablet-like products from Hewlett-Packard, Dell, and Google's allies by the end of the year. The personal, portable and pretty Web will keep evolving. Smart retailers will figure out how to harness millions of new partners, and e-commerce as we know it, will never be the same.

Oren Michels is the co-founder and CEO of Mashery, provider of API management tools and strategic services that help retailers connect with customers and partners in a changing digital world by extending reach across devices, markets and the Web.