Continuing the API Economy Business Drivers series this blog addresses the second business driver in the series – “Reach”.  By “reach” we are referring to reaching new customers or new markets.  The customers I find have the largest success with their API initiatives think of APIs as a new channel.  Let’s take a look at how APIs can help.

How do your customers do business with you today?  The vast majority are coming to you.  They either come to your physical location (if you have one), come to your web site, or perhaps have your mobile App (but in this case they most likely were already a customer).  Possibly they did a search on a product or service they want and were directed to your store or web site.  They come to you.

But what about reaching out to the potential customers that aren’t coming to you?  Would that be attractive?  Of course.


Businesses are looking to expose their assets – data and transactions that drive sales through APIs exposed to third parties, social networks or other scenarios.   Customers using these external resources might then become potential customers of yours.

There are several common scenarios:

  • Comparison Apps – in some industries this has become the de facto method of obtaining customers. In travel, only a small number of potential customers search through individual airline, hotel or car rental sites.  Most use a comparison app or tool such as Kayak, Expedia, Orbitz, Travelocity, etc.  These comparison sites need up to date information on availability and pricing and access APIs from the providers to get it.  Comparison Apps are certainly not limited to the travel industry and are growing at a rapid pace.  Retail, Banking, Product Manufacturers, Insurance, and many other industries all have comparison engines today.  If you want to be an option, you need to supply an API or run the risk of being ignored.
  • Partners – of course every business already has partners (see “I already have partners…”) so why APIs? The on-boarding process for partners is very time consuming for both your business and theirs.  After your companies agree to become partners, the technical efforts to access each other’s systems can take weeks or months to set up.  This is simply not scalable.  Through APIs and a self-service developer portal, the partner on-boarding process can be drastically simplified and your ability to reach new customers through a larger number of partners can occur much faster.  With a wide range of partners both from an offering perspective and geography you can multiply your customer reach.
  • Public – you can think of public as an extension of partnering. These are external businesses you just don’t have a partnering relationship with yet.  The on-boarding of a public consumer for your APIs is part of establishing the partnering relationship.  The monetization models that you implement are imbedded into the developer portal and sign up process for API consumption.
  • Social – aside from your friend’s posts, what do you see on Facebook? Advertisements based on something you have investigated, searched or otherwise shown interest.  Companies are using APIs to push advertisements onto social media for their offerings.  The simplest form of this comes when someone searches on your specific product and/or company name.  However, searches on competitor products or other scenarios (see below) can also generate potential customers.
  • Device scenarios – Cars, ATMs, security cameras, and many other devices can provide opportunities for your business even if you are not in the industry that owns these devices. Cars travel along routes on a regular basis.  Insurers, Automobile manufacturers, mobile phone service providers, etc. can all obtain data from their devices as to where your potential customers travel.  Partnering with one of these companies to access their information can lead you to additional attractive customers for your offerings.  And car travel is only one example.  ATMs can be enhanced to identify when customers (who opt-in) are in the area.  This information can be shared with local retailers who might want to make an offer for this new potential client.


As you decide to focus on Reach as your business driver, I encourage businesses to think about what I call their “Business next door”.  A “business next door” is another business probably in another industry that is related to yours such that when a customer wants what the other business offers, your product would also be of interest.  Every industry has an industry next door.  Here are a few examples:

  • When someone is buying a car or a house they may need a bank loan or insurance.
  • When someone is planning a vacation, besides the obvious travel linkage, they may need climate appropriate clothing.
  • When someone has a baby, there are many opportunities – clothing/baby toys, healthcare, food/nutrition, investments for education, insurance, etc.

Identifying your businesses next door provides you with the target market for your APIs.  By either partnering with companies that are your business next door or acting upon searches for these items on social media, you can reach out to additional customers and markets.


Reach is the business driver that I most closely associate with the term “API Economy”.  Reach is about forming a cross-industry ecosystem
that benefits all.  It is a win-win-win situation.  You win by obtaining new customers. Your partner wins by providing a better offering when combining your offering with theirs.  And, your joint customer wins because they obtain a more complete solution to their needs than they would have previously.  Next up in the Business Drivers series – “Innovation”.


To understand more about IBM’s thoughts on the API Economy visit the IBM API Economy website.  IBM API Connect is IBM’s complete foundation to Create, Run, Manage, and Secure APIs.  You can find more information about IBM API Connect at the API Connect website.  And you can also experience a trial version of API Connect.


If you have questions, please let me know.  Connect with me through comments here or via twitter @Arglick to continue the discussion.

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