API Battle Plans: Fighting for Next
We have reached maturation point with APIs where the three core components of the web experience – content, utility & data – are becoming readily available via API delivery. The implication of this growth is nothing less than the next web. A smarter web that delivers improved relevance, a better experience and expanded revenue generation opportunities. As the ramifications of these benefits become understood businesses now have no choice but to support an API superstructure, the pillars of which are content, utility, development and analytics.
But where do forward thinking businesses begin?
Though APIs have been around quite a while for information we are still in a nascent period of growth for content and utility. Amazingly we’re even earlier in using APIs to optimize digital media and experiences. Can you imagine a fully dynamic web? I know it may seem hard when in some respects we're guilty of leaving the mashup behind with the rest of Web 2.0.
An ambient web calls for strategies that leverage that ubiquity. APIs are they key to this. Semantic web (or the new & improved term, linked data) will also have a big role. As best I can I am sharing my thoughts on how start-up, legacy digital, and traditional businesses should approach an API strategy for their digital business. I welcome your thoughts in the comments. The only thing I know for sure is the ramifications of not having a battle plan are as large as the opportunity for those that do.
Bitly: A Model API Army
There are many approaches to using open content and data however unless you create something that blends the core API components (content, utility, development and analytics) you will always be vulnerable or at a competitive disadvantage. The best example might be in URL shortening.
There are quite a few URL shortening solutions however only bit.ly marries content (linked page), utility (URL shortener & link), development (Calais) and analytics (click data). The sum of bitly's parts are greater than it's whole but even the parts on their own are valuable at different times depending on the goals of the user (and the biz dev goals of bit.ly). This layered approach is why bit.ly is a homerun and should be a case study for how create new solutions using APIs.
So let’s dive into using each of the API components of the web experience together in the manner bit.ly is doing and see what we can learn.
CUDA: The API Stack
Everyone likes to talk about stacks these days so I’ll frame what’s involved in successfully creating API battle plans within your organization in that manner.
I'm calling it CUDA because, well I'm a marketing guy and it sounds cool.
Layer 1) Content APIs: Text, Images, Audio & Video
Since the web is an information medium content APIs present the biggest opportunity but also the biggest challenge. The thing holding back success for content providers might just be themselves. Creating an API is but just one layer of the stack.
The New York Times believes its API will deliver 2.5X the amount of eyeballs on their content. But how? Depending on unknown third parties to bring you revenue from your API is akin to a salesman sitting around waiting for the phone to ring. The content API is your raw material but how you mine it and what you chose to make with it can be the difference between diamonds and coal.
One problem for publishers is that they have never been very good with digital marketing or technology innovation. To make matter worse technology innovations have been publisher agnostic. The fact that the Kindle brings Amazon higher margins on Wall Street Journal subscriptions than the WSJ gets (not to mention the direct loss of revenue and customer relationship to the Journal) should be all the motivation needed for in-house solutions to take priority. When it will happen in earnest is anybody's guess.
Layer 2) Utility APIs: Messaging, Payments, Pricing
It’s becoming clear that messaging, payments and other API based tools &utilities will ultimately lead to the most creative use of APIs. We have already seen this around the API fueled Twitter ecosystem with numerous products being developed off the API and some even being acquired by or partnering with Twitter. I think this area is going to explode in the next year. Integrating utility is a one-time deal with long payoffs for core platforms. For entrepreneurs and VC this biz can also presents a quick flip opportunity.
We’ll soon see more transactional APIs in place with the much-anticipated Facebook payment leading the way. At my own RAMP Digital we’ve incorporated mobile carrier transaction APIs into a display ad to facilitate a subscription purchase from within the ad unit. Solutions like this are just the beginning of the next wave of API fueled utilities.
Layer 3) Development: API Services
In many ways dev is always the core layer. On the path to a true web of services it will be the innovation that can be built on top of it all. http://camelbuy.com/ is a great example. Created using the BestBuy API it delivers a wealth of information and value. It’s a great start but businesses can’t be lulled to sleep believing their API’s success (and ultimately their own) will be taken care of by developers earning affiliate commissions or contest winners.
Creative and media agencies will be of little help. Not until service businesses are built that uniquely understood the technology and have developed methodologies (with results) will the promise be fulfilled. Without services I’m afraid that there will be no case studies, no evangelists, no competition and ultimately no performance improvements for the web. But why build these businesses if there are no customers? Or why not just DIY if you're so smart about it?
If anything is holding back the next web it's not optimizing the content delivery -- it's optimizing the content presentation.
Layer 4) Analytics APIs: Data Profiles, Parameters,
API fed data has already had a profound impact on the web. Google is making 4 billion calls a day on its APIs (think for a second about the competitive advantage they have in place in order to do this).
The first decade of the commercial web saw counting. This new second wave seems to be about insight. This game changer is realtime data. RT is going to change everything from content delivery to dynamic pricing models for ads and traffic.
We are also moving from a browser web to a web where anything can make a request, not just a browser. This requires new ways of collecting and analyzing data along with new ways of optimizing. Good thing that is what we’re using APIs to make it all easier.
The winners in the first decade of the commercial web were sites like Amazon and Google that focused on performance, user experience, testing and optimization in order to deliver relevance and revenue. The winners over the next decade will be those that take those same tenets and apply them to how they aggregate and develop the content, utility and data that APIs will deliver. We are at a point in time where we are optimizing how we incorporate what the web has to offer. Unlike before, it now offers us everything.
Some Previous Thoughts on APIs: