Does the term ‘Open API’ sound familiar? When developing strategies to grow, the most innovative companies are exploring a new field that promises to change the rules of the game within a short period of time.
The idea of “selling more” is being replaced by “selling different,” by addressing possible customer needs.
Companies such as BBVA or VISA are focusing on Open Source APIs to generate income through new services that offer their customers a greater flexibility, and as a result, a higher level of satisfaction.
And they are not the only ones. This is just the beginning of a trend that promises to be unstoppable.
The use and monetization of data and information opens up a business landscape that is extremely lucrative.
Facebook’s business model has made it clear. Knowing everything about the user means knowing his needs, and therefore, having the opportunity to satisfy them. Every marketing manager’s dream, don’t you think?
It is therefore worth taking a look at how Open API can help any business expand and grow.
What is an Open Source API?
First, let’s shed some light on a few concepts.
When we talk about APIs, we are referring to an interface that allows two different applications to communicate with each other and, while being independent, share information.
In a way, an API is like an instruction manual that allows an application to communicate with it, and be understood by it. And a benefit to the user arises from that communication and interaction, in the form of a value-added service.
An Open API is available to anyone that is able to use it, which leads to a wide range of possibilities, since it allows any company to add functionalities to their services.
This is why they are so important in relation to business development.
A company can take advantage of work previously performed by other developers to offer its customers a value-added option, without the need to invest money, time and efforts toward creating that functionality.
One example that is easy to understand is Google Maps, a geolocation service that can be used by any company to point to its location on a map.
Thanks to this, customers can find the physical location of a store in a much faster and visual way, which increases the chance of them visiting it to make a purchase.
In order to accomplish this, that business didn’t need to develop any application. It simply used the Google Maps API.
In the same way, companies can develop Open Source APIs to communicate with others and create partnership opportunities that translate into higher profits.
Make your business evolve with an Open Source API
Can you now see more clearly how an Open API can imply the creation of new business opportunities?
In an increasingly digital world where business transactions are performed with a click of the mouse with increasing regularity, understanding the business concept behind APIs is of significant importance.
This trend will not be reversed, which means that no matter the sector in which your company is doing business, the only possible landscape is an ever-increasing digitalization.
And if the clients interact with your company through a digital environment, the rules of the sales and marketing game completely change.
The creation of Open Source APIs is not limited to offering a new feature or characteristic to your product; it is a product in itself that should be conceived from day one as a tool that can generate income as a result of its use.
This means that, in addition to the feature that it offers to the user, you should take many other factors into account. Not only that – you should develop an entire strategy that allows you to define how you are going to monetize that feature, and the type of strategic alliances that may be built through it.
Those who are already walking this path are clear on this, to the point where it is quite common for a technical manager to be assigned to overseeing the development team, to make sure that the API is achieving the goals on the roadmap.
Therefore, the development of Open APIs implies an evolution in every sense: it does not only provide a higher satisfaction to the customer through new services or features; it also allows for new ways to profit that are not related to the sale of products or services to the end user, but to partnerships with other companies that can integrate them instead.
Open Banking API success stories: BBVA and VISA
One of the best examples of how APIs are streamlining an economic sector is banking.
As we already mentioned at the beginning, major corporations such as BBVA and VISA are going all in on this model, with great results.
The banking sector is a clear example of the evolution of services from a physical environment to a digital one.
Nowadays, most of the financial operations that we perform take place within a banking application rather than in an office.
This is possible thanks to the trust generated by digital banking, and to the fact that payment methods such as VISA are already applied to online purchases practically worldwide.
But the most interesting thing is how this impacts other sectors.
Since BBVA launched its Open Banking business, offering its APIs to other companies, the use of these APIs has multiplied beyond their initial conception.
And herein lies the magic. Because, no matter how broad the focus of an API’s design may be, it is business owners who can best imagine new applications, which generates a multiplying effect.
Therefore, Open APIs imply a major leap toward the future digital strategy of companies, and they can become absolutely surprising and unexpected sources of income.
Do you want to take your business one step further? Chakray, the first WSO2 partner, will offer you a solution tailored to the needs of your company. Contact us!