As a technologist, I have always discounted marketing hype. Frequently, I hear about "helping enterprises with digital transformation." However, every time I hear those words I start to wonder: what exactly is digital transformation? Isn't the entire IT spend already all about digital?
A discussion of "two-speed IT" helps clear this up. In this context, digital is about new user experiences--mobile, the IoT--basically new forms of interactions with enterprise systems. This, however, is still not measurable enough. What does digital really mean? To answer this question, let's start with something we all understand: mobile commerce.
The new digital retail
E-commerce reached its prime during the late 1990s. Since then, it has gone mainstream. Recent estimates of retail e-commerce put it at about $1.4 trillion, or about 22% of overall retail commerce. By 2019, this is going to be about $2.4 trillion, or about 33% of the overall retail commerce. E-commerce was "digital" for the 2000s. But m-commerce (mobile commerce) is digital for 2015. It's not just a new modality--it's a whole new experience. Enabling this experience requires a lot of new infrastructure: APIs, BaaS, big data analytics. This is the digital transformation our retailer customers talk to us about.
But something else is happening in this retail digital transformation. The channels (physical, web, and mobile) are blurring. Who has not seen the "Buy online and pick up in store" option in your favorite retailer's mobile app? This is omnichannel, and it's also the new digital.
Enabling this experience of course requires the APIs, BaaS, and big data we mentioned above to power every channel. In addition, it requires a consistency of experience through common APIs, and new business and data logic to sit in or near the API layer.
So mobile commerce + omni-channel = the new digital of retail, right?
Not quite. There's more. Retailers need to form new business partnerships. Rewards, points. Social. Payments. Photos. Name a physical function or a physical partnership, and it needs to become digital. This is all the new digital of retail.
So mobile commerce + omnichannel + new partnerships = the new digital of retail, right?
Almost. There is one aspect of retail that is the same as every other industry: IT. In order to deliver these new experiences, over time, backend systems need to transform. More DevOps, more microservices. This is the new digital backend, in support of new experiences in the front.
So in retail, mobile commerce + omnichannel + new partnerships + new services = the new digital of retail.
APIs: the key to all interactions
Guess what? The only constant in these four elements is APIs. They're the underpinning of all system-to-people, system-to-system, and business-to-business interactions. That's it. One common factor.
How big is this? Mobile commerce is supposed to be $2 trillion by 2019. So APIs will drive at least $2 trillion of commerce. With omnichannel, this number could easily be $4 trillion (all of e-commerce). Or even larger, if physical commerce gets transformed.
Now look at travel. When was the last time you walked into an airline booking center and booked a ticket? Or walked up to a hotel lobby and booked a room? It's all digital now, and, increasingly, mobile. Mobile travel bookings are growing at 3x the rate of web travel bookings, easily surpassing the latter to be at least $1.5 trillion by 2019. All mobile bookings, ratings, and browsing happen through APIs, so it follows that at least $1.5 trillion of travel sales (out of an industry total of $6 trillion) will happen through APIs.
Take financial services. Or health. Or media. Or real-estate. Or any industry (ok, not mining perhaps). A shift to digital. A shift to mobile. Trillions of dollars of activity through new digital. All powered by APIs.
The new digital is that big. APIs are that big.
And then look at the trend of microservices. How are the services talking to each other? Through APIs, of course!
Our 2024 Coverage Needs You
It's Another Trump-Biden Showdown — And We Need Your Help
The Future Of Democracy Is At Stake
Our 2024 Coverage Needs You
Your Loyalty Means The World To Us
As Americans head to the polls in 2024, the very future of our country is at stake. At HuffPost, we believe that a free press is critical to creating well-informed voters. That's why our journalism is free for everyone, even though other newsrooms retreat behind expensive paywalls.
Our journalists will continue to cover the twists and turns during this historic presidential election. With your help, we'll bring you hard-hitting investigations, well-researched analysis and timely takes you can't find elsewhere. Reporting in this current political climate is a responsibility we do not take lightly, and we thank you for your support.
Contribute as little as $2 to keep our news free for all.
Can't afford to donate? Support HuffPost by creating a free account and log in while you read.
The 2024 election is heating up, and women's rights, health care, voting rights, and the very future of democracy are all at stake. Donald Trump will face Joe Biden in the most consequential vote of our time. And HuffPost will be there, covering every twist and turn. America's future hangs in the balance. Would you consider contributing to support our journalism and keep it free for all during this critical season?
HuffPost believes news should be accessible to everyone, regardless of their ability to pay for it. We rely on readers like you to help fund our work. Any contribution you can make — even as little as $2 — goes directly toward supporting the impactful journalism that we will continue to produce this year. Thank you for being part of our story.
Can't afford to donate? Support HuffPost by creating a free account and log in while you read.
It's official: Donald Trump will face Joe Biden this fall in the presidential election. As we face the most consequential presidential election of our time, HuffPost is committed to bringing you up-to-date, accurate news about the 2024 race. While other outlets have retreated behind paywalls, you can trust our news will stay free.
But we can't do it without your help. Reader funding is one of the key ways we support our newsroom. Would you consider making a donation to help fund our news during this critical time? Your contributions are vital to supporting a free press.
Contribute as little as $2 to keep our journalism free and accessible to all.
Can't afford to donate? Support HuffPost by creating a free account and log in while you read.
As Americans head to the polls in 2024, the very future of our country is at stake. At HuffPost, we believe that a free press is critical to creating well-informed voters. That's why our journalism is free for everyone, even though other newsrooms retreat behind expensive paywalls.
Our journalists will continue to cover the twists and turns during this historic presidential election. With your help, we'll bring you hard-hitting investigations, well-researched analysis and timely takes you can't find elsewhere. Reporting in this current political climate is a responsibility we do not take lightly, and we thank you for your support.
Contribute as little as $2 to keep our news free for all.
Can't afford to donate? Support HuffPost by creating a free account and log in while you read.
Dear HuffPost Reader
Thank you for your past contribution to HuffPost. We are sincerely grateful for readers like you who help us ensure that we can keep our journalism free for everyone.
The stakes are high this year, and our 2024 coverage could use continued support. Would you consider becoming a regular HuffPost contributor?
Dear HuffPost Reader
Thank you for your past contribution to HuffPost. We are sincerely grateful for readers like you who help us ensure that we can keep our journalism free for everyone.
The stakes are high this year, and our 2024 coverage could use continued support. If circumstances have changed since you last contributed, we hope you'll consider contributing to HuffPost once more.
Support HuffPostAlready contributed? Log in to hide these messages.