In 2006, brands, marketers and agencies exploring the concept of open APIs–from Best Buy to Netflix, Tesco to GAP–brands began to experiment with just what empowering third-party data could do. According to Programmable Web, at the end of 2012, there are just over 7,600 companies with open APIs; brands are putting APIs on the top of their actionable to-do lists in 2013.
Before APIs, the only way a company could access another company’s data was by going to a company itself. The exponential growth in data and cloud capabilities, coupled with complex user expectations and behaviors that drive consumer transactions, companies are finding that the continual innovation is necessary in order to maintain competitive advantage; access to open data allows that.
What is an API?
API is an acronym for “application programming interface.” An open API is a data system that possesses an interface that lets third-party software interact with a company’s data and enables those third-parties to remix that data to potentially build useful new tools on top of or increase its functionality or augment content. Currently, there are two types of APIs–open and closed–which are sub-classified into commerce (of which there are sub classifications) and public.
Think of an API as an innovation tool. APIs also provide the ability to scale with minimal investment by simply providing data that your third-party developers can use to develop their own software and applications. These softwares and applications could ultimately lead to the development of new technologies or more commercial (profitable) uses of something the company already has.
Hesitation With APIs
While cost-effective scalability and an army of developers may be extremely appealing for some, there are others that are not so gung-ho on the accessibility that APIs offer. Earlier this year, both Facebook and Amazon clamped down on access to their APIs, Google started charging for its Google Maps API and Twitter’s stricter rules in regards to its API that caused massive backlash online. The changes in the API models left some developers wary about building on another company’s platform.
Also, some companies feel that by releasing something they’ve long considered proprietary, namely use of company images and logos for brand interpretation, they put their brand image at risk. Solutions for both of these come through research and planning:
- How dependent is your business going to be upon building on another company’s platform?
- If they make changes, whether to the pricing model or the services provided, how will you adapt your product in order to accommodate?
- Can your brand create a tiered API program that opens different services to different partners, under different terms or rules in order for you to maintain brand values and requirements?
Create an API that Allows for Experience and Utility
When creating successful APIs, brands “must meet the demands of content and utility that audiences crave, but that are readily consumable in bite-sized chunks so audiences can devour them on their own terms—and developers can serve them on theirs,” says Adam Klienberg.
Websites and mobile apps are not the only places where consumers seek to purchase goods from retailers. When companies develop APIs, they must focus on creating unique experiences while discovering new potential places to connect to consumers and discover additional revenue streams. All must be have smooth, frictionless transitions across all devices, platforms and touch points. APIs will help us create the new opportunities while retaining control of the brand.
How To Successfully Launch Your API
Like any good strategist worth her salt, I believe timing is key to releasing anything, I also believe that a release can’t strictly have hype value; it has to have genuine value. APIs have immense value and potential, so when you launch one, you should aim to be successful from day one. This starts by making sure you haven’t based it on dated API models. Why shoot yourself in the foot as soon as you’re out of the gate?
Timing is everything. Chuck Freedman, Director, Platform Strategy at Mashery (recently acquired by Intel for $180 million dollars), recommends timing the release of the API with major industry-related conferences (like the Business of APIs Conference) or other events where your competitors—and potential partners—are looking directly at your company. “At these events you have developers from startups or big companies that have freed themselves up to creatively work with your content in the context of what their company does,” he said.
It’s important to remember that your company wants to provide the building blocks for innovation. You want to enable application designers the tools and information that lets them create things that you probably could never, ever imagine. – Macala Wright
This opens the field up for very interesting consumer-led collaborations and initiatives. It entices them to take your datastream and reuse it in a number of different media environments: mobile, internet-enabled TV, the real-time web and other places where customers are increasingly hanging out. It’s also important to remember that if you want your partners to be able to create the things you’ve never dreamed of, you’ll have to provide the right amount of developer support, documentation, as well regulation, in order to be successful. In other words, make sure your API strategy is solid. A solid strategy will allow your staff to focus on the brand goals that power your digital strategy without distraction.
There are also more creative ways to experiment with partners and APIs. At SXSW this year, Path announced that it would be opening its API with Nike as its first partner and Nike held a FuelBand hackathon. Both of these are great examples of how one initiative can serve three goals; in this case, strategic partnerships, marketing events and providing technological advancements within a company.
Creating and Maintaining Successful Partnerships
With the launch of an API, your relationship with you partners becomes just as important as your relationship with your core customers. The developers leveraging the company’s API become key stakeholders in the company’s future, and could make or break it in terms of increasing innovation, revenue and reach (customer acquisitions and retention). Like any other initiative, it’s important that you allocate the proper staffing resources, with the right levels of authority, in order to make API programs successful and scalable.
“Open API initiatives will not make you glamorous overnight.” – Salim Hedami, Razorfish, Group VP, Experiences and Platforms
When providing access API access, some companies provide access free of charge (Amazon, Google, Facebook, Twitter, Foursquare), recognizing the value of the partnership as equal to the data value; while other companies only provide access to data after charging a fee, and then charge more based on how much data is needed.
A recent example of a company wanting to create successful relationships with its developers would be Jawbone, which repositioned the UP fitness tracking wristband as a development platform with new partners, with an open API coming soon. Jawbone wants users to do more with their activity data, and it plans to collect even more of it in the future. “A lot of these platform announcements like API releases are more PR than they are actual real developers on a platform building value for users,” said Hosain Rahman, Jawbone CEO. “We spent a lot of time sitting with developers, looking at what they can enable, what their data structure was, how to pull their experience back into UP, how you really create robustness around them, how to build APIs that work dependably and how we can make sure users can get this stuff.”
According to senior technologist Basil Farano of Fresh Concepts Lab, open communication and honest feedback on results with an emphasis on what’s working and what’s not is imperative. Some brands have considered charging for their APIs, but Farano advises that brands not charge for their APIs. Instead, brands should offer their APIs free of charge with a commission paid to partners by the brand.
If you’re looking for creative ways to use new media environments in conjunction with your API, Farano advises brands to look for voids in the brand’s market position such as mobile and tablets. You may also consider reaching out to a new demographic. Brands want to find ways to add value to what they’re already offering through their platform, and gamification offers a lot of opportunities in this area.