An API is, essentially, a link between two applications or pieces of software that enables them to communicate. It operates silently behind the scenes and is invisible to users, yet we use APIs as an intrinsic part of our digital activity. For example, when a consumer makes an online purchase and enters their credit card information, the product website then uses an API to send this information to another application for verification, and in turn receives confirmation of payment authorisation in order to issue the product.
The benefit of using an external API in this instance is that it allows the product website to outsource software and processes, such as payment verification, and circumvent the need to develop and manage non-core software. So instead, they can focus their resources on developing the core software they need for their business.
But this doesn’t just benefit the service receiver. Companies are using their own APIs as vehicles to expand their business presence exponentially, at significantly reduced cost and effort. By releasing the programming information, companies put their product or service in the hands of external developers, who can repackage and release their offering to a wider market. Developers then earn a share of revenue stream commission, while companies widen their business reach.
An example of this is companies, such as Amazon and eBay, who share their APIs with developers, who in turn host the purchasing platform on their own websites, circumventing the need to link to Amazon or eBay’s websites. Using the building blocks provided by the shared API, these external hosts are able to access and develop a more dexterous application that they can customise to suit their business needs – integrating enhanced information and add-ons, such as market research and custom searches – without being restricted to the pre-defined structure and capabilities of Amazon or eBay’s own websites.
Demand is growing, as both companies and developers seek to capitalise on this new flexibility. And as mobile devices and apps transform the digital experience away from websites, companies are reacting to the need to focus on their API development, to capitalise on a dynamism and market reach more immediate than that offered by their website presence.
APIs enable companies to distil and present the core element of their business without being hindered by the wider requirements of website development. According to Apigee, a digital business platform that helps companies build APIs, “APIs bridge the chasm between IT requirements and those of the new digital economy”.
But perhaps what makes them most relevant to your business future, is that they are a tangible vehicle for joint innovation and partnership. Denise Persson, Chief Marketing Officer of Apigee, explains that, not only do APIs let you showcase your business on mobile devices, but they also “open up access to millions of app developers around the world who are hungry to build the next big thing. Enabling those developers with easy and secure access to your data and services to create new business opportunities. ”
A recent example of the potential for collaboration is the US drug store chain, Walgreens, which released theirs for their QuickPrint photo printing machines. As a result, over 75 different mobile apps integrated this service, creating increased opportunity for customers to access Walgreens’ services and print photos to any of their 8000+ locations. These app developers earn a revenue share commission, while Walgreens benefits from increased business traffic and sales, with limited output.
For more information on Graydon's API and other related information, visit the API wikipage.
APIs are being used in a myriad of ways. And as companies and developers continue to find new ways to utilise them, their current incarnation may merely be the tip of the business development iceberg.
According to ABI Research, by 2020 it is estimated that there will be 30 billion wireless connected devices . The future certainly seems to be mobile. And in the words of Brant DeBow, Chief Technology Officer and co-founder of BiTE interactive: “If your company wants to be prepared to thrive in the mobile revolution, APIs should be a primary focus, not an afterthought.”
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