API monetization can drive significant business growth. It ties back to curating and monetizing your APIs in a marketplace that you build to simplify and increase API adoption.
But all API marketplaces aren’t built the same. To drive API monetization — what you can think of as revenue growth — you must bundle and create digital products in a way that simplifies and improves their consumption. When you get these elements right, you’ll succeed.
Step #1: Link multiple API products to create a business service for monetization
When organizations consider APIs as technical interfaces, the focus is on functionality. With a product-oriented perspective, the emphasis shifts to the user experience.
Ask yourself this question: What do I need to get my APIs to fit my target market? One of the most critical factors is the bundling of APIs. Developers traditionally create APIs from a logical set of linked digital assets. This linkage provides a more robust solution to consumers and streamlines management.
Connecting your marketplace APIs to business objectives helps you build a linking strategy. Think about how consumers will use your APIs. From there, you can develop a relevant value proposition and documentation.
Consider the case where an insurance company combines internal APIs for policyholder information, claims history, and risk assessment. Linking these APIs supports a single product for enhanced underwriting and minimized risk. An API marketplace can showcase this product to fintech providers and loan companies.
The idea is to link together APIs as assets that are complementary to one another or work together. In an API marketplace, you can group these API products by domain or target audience for easy discovery.
When you have insights into API usage, this task becomes easier. That was the case for BNP Paribas Personal Finance, a leading provider of consumer credit. With a complete view of all their APIs and usage information, they could back up their insights with hard data. From there, they were able to kick their API monetization strategy into high gear.
Step #2: Create and manage API products with subscription plans for monetization
API monetization models can come in different forms. The most obvious of these models is direct monetization. In this scenario, users pay-to-play through defined API product subscription plans.
Alternatively, there are also indirect monetization models. In this case, APIs may be free to use. Yet their use helps to improve company market presence and business revenue.
When you have a pay-to-play case, you have a few plan options for an API pricing strategy. There’s a standard option where consumers pay a base price for a guaranteed quota. There’s also a pay-per-use option where consumers pay a fixed amount for every consumed transaction — with no limit. Standard subscriptions work well in cases where API usage is predictable. A pay-per-use subscription is ideal for instances where API usage vary widely, perhaps due to seasonal spikes.
That said, there is value in making API product subscription models flexible. A tiered pricing structure lets you offer your services at various price points based on the volume of consumer transactions. This approach can help you expand your marketplace audience and increase revenue opportunities.
For example, here’s what a tiered subscription could look like:
|# of transactions
While thinking about these plans, consider what the workflow looks like after someone subscribes. Are consumers granted access automatically, or does there need to be a workflow for manual approval? Whatever the case, the goal is to make subscribing to marketplace APIs as intuitive as possible.
Step #3: Publish APIs to your marketplace to speed up adoption and time to market
Whereas an API portal treats APIs as a technical interface, an API marketplace treats them as business assets. It’s where you connect APIs and expose them to internal and external audiences for consumption.
To successfully promote your APIs, you need a well-designed, well-developed infrastructure.
- Are APIs arranged in a way that makes them easily discoverable?
- When a consumer clicks on an API product, is there documentation about its value and technical implementation?
A marketplace user experience should account for these kinds of variables. That way, consumers can locate and start using these digital products faster.
You’ll find this kind of flexibility with a private marketplace. With a public API marketplace, you can publish APIs and charge for them. A private API marketplace functions more like a branded storefront. While you can align the look and feel of the marketplace with your company, you also have more control over how you present and promote APIs. This functionality can help you achieve marketplace monetization faster.
With a Universal management platform to support your API marketplace, you’ll have visibility into key metrics. You can access data on API usage and performance insights. Drilling down into these details helps you continue to refine and improve your digital products and API monetization strategy for the future.
Start capitalizing on API monetization
Research shows that the API economy is a top priority for organizations. In fact, API monetization has increased by 16% in the financial services industry alone.
Pairing these three strategies with Amplify Enterprise Marketplace sets you up for success. Our marketplace unifies all your APIs in a single place. This creates a more seamless experience for your consumers.
As an API provider, you can automatically discover all your APIs. You have the building blocks to support faster product development.
Meanwhile, consumers can quickly find validated, documented, and secure API products. That helps drive the consumption of your digital initiatives.
Take it from a leading pharmaceutical company that moved from standalone APIs to clearly defined, packaged APIs in Amplify Enterprise Marketplace: “We’re confident that this approach will help us ramp up API adoption quickly.”
Learn more about leveraging our turnkey API marketplace in this 30-minute, on-demand demo.