Benefits of Building An API Economy With Mobile Apps

API economy is an evolved term that has come around from being just a link to an added functionality in an app to a whole paradigm capable of highly connected, functional, and intuitive apps. In this blog, we will have a look at how APIs have transformed the whole app development avenue paving the way for a surge in the thriving API economy. We will also touch on how enterprises can capitalize on this economy. Let’s begin by understanding what an API economy is:

APIs refer to a set bundle of functionalities packed in code and customized for reuse in any other application as needed. According to Gartner, APIs enable connectivity amongst people, places, data, systems, and algorithms, and create user experiences. It also helps share data, information, authentication information, and facilitate transactions, and leverage third-party algorithms, in a bid to create new products or services as well as business models. The API economy has come out to be an opportunity that helps create new services, capabilities, etc. which shall ultimately give rise to new sources of revenue.

Types of APIs 

There are four main types of APIs:

• Public APIs: For these APIs, there are no restrictions and they can be publicly accessible by organizations and developers. 
• Partner APIs: These types of APIs require rights or a license to be used. Some APIs might just need a step as simple as signing up as a partner others may need developers to offer details of their ideas. IBM for example has a partner API under its Watson platform, needing developers to contribute their ideas and get approval before they can access them.
• Private APIs: These kinds of APIs are made for internal systems. These are designed to be used internally internal within a company. The company uses this type of API among the various internal teams to improve its products as well as services.
• Composite APIs:  These APIs combine sequence of services and tasks that execute synchronously. It is mainly used to expedite the execution process and make performance improvements in the web interfaces.

Monetizing APIs

APIs can help businesses rapidly scale up by accessing third-party services and data. It can help them transform their services into a platform that empowers others to build upon and use it. For instance, a communications company can offer its chat API on a subscription fee to its clients, who can further customize it to integrate into their point-of-sale systems for customer interaction. Similarly, a fintech or a payment gateway company can offer retailers its API as a way to accept payments online. APIs are the building blocks of IoT too because they allow IoT devices to communicate together quickly without a human user present.

Instead of building all the APIs that IoT and mobile devices use from scratch, developers have the provision to pick APIs from various sources, enabling interoperability, customization, and efficiency to match increasing consumer demands. For example, weather details can be sourced on a maps app on a wearable device, from a third-party API or a weather company, and this data can be built upon to offer customers a more authentic and holistic user experience.

Benefits of the API economy

A primary benefit of the API economy is, that it encourages people to collaborate with API providers and deliver engaging as well as efficient user experiences. APIs and microservices can be improved and changed faster. This enables organizations to integrate business processes and access previously unavailable business ecosystems via enhanced flexibility, agility as well as data access.

Other benefits include:

• Continuous improvements: APIs are opened to third parties such as customers and shareholders to be customized and altered.
• Enhanced customer experience: Due to their inherent room for customization, users can tweak them into various use cases to optimize the customer experience.
• Accelerated product delivery:  The economy offers a gamut of industry-approved tools which developers can use rather than creating them from scratch.
• Added revenue stream: APIs help products get into the market faster, and offers companies time and freedom to find ways of increasing revenue.
• Non software organizations also get an opportunity to improve their processes with APIs rather than hand coding a proprietary software.

Conclusion

As the API Economy continues to mature, more companies will realize that APIs can help them successfully launch new services and transform their business, relationships, and experiences. Leaders need to understand their value and how selecting a trusted API development company can deliver these key building blocks and measurable results for your business.

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