The Keys to Building a Successful API Product

The Keys to Building a Successful API Product

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In recent years, there’s been a shift to discussing APIs as products. This fundamentally changes everything from how an API is marketed to the documentation and even the architecture itself. One of the most fundamental shifts is the transition from focusing solely on developers to convincing people from a business background to adopt your API.

“Over a four-year period, firms using APIs saw 12.7% more growth in market capitalization compared to those that did not adopt APIs,” says Jason Harmon, the CTO of Stoplight and host of the API Intersection podcast, citing research from MIT researcher Marshall Van Alstyne. That number grows to 38% when extended over 16 years.

For a little over half an hour, Harmon gave a talk on how to build and grow your API like a product manager at the 2023 Platform Summit hosted by Nordic APIs in Stockholm. Below, we compile numerous tips and words of advice from Harmon’s talk and share some thoughts of our own.

APIs Aid Composability and Adaptability

To begin, Harmon recommends what he calls the “MIT school of thought” if you want to see your API grow and prosper. This includes microservices, modular distributed architecture, single points of responsibility, and decoupling, among others. He also recommends adopting a composable business architecture, which is a microservices-based approach that combines various reusable technologies to create a unified system. This architecture should be built with business capabilities in mind, which are explained in everyday language.

Harmon describes the difference between a composable business model and a marketplace. A marketplace focuses on a traditional supply-and-demand business model. It also requires a more thorough understanding of network effects to be successful.

Think Of Your API As Just Another Product

Speaking on some of the lessons he’s learned as an API developer and hosting the API Intersection podcast, Harmon says that the API is just another product. According to Harmon, folks tend to overthink this aspect, probably because they are intimidated that APIs are such a technical artifact.

Harmon recommends three steps to help you better conceptualize your API as a product. The first is to recognize your relationship to your API, which will give you an idea of how your users might engage with your product.

Harmon goes on to provide some additional steps for identifying relationships. Adopting a customer-centric mindset is the first step, as it will help you determine how your API fits into the marketplace. Adopting a customer-centric mindset can even influence your API’s design.

Harmon points out that APIs are often more than simply a layer over your data. Most of the successful and popular APIs perform some logic in addition to acting as a front-end. He also recommends not trying to do too much with a single API. “Just get something shipped,” says Harmon, which is always sound business advice. It doesn’t need to be perfect, as there will probably be a V2 at some point.

Next, Harmon recommends conducting market research by studying data and interviewing your power users. “You measure what you treasure,” Harmon says. He goes on to share some tips on how to pitch your API when your audience has a business background. Before meeting with the C-suite, you’ll want to clarify your unique value proposition.

He goes on to share some additional tips on how to win over executives:

  • Ask yourself how your API fits in with their business model.
  • Understand the shift from traditional revenue models to integrated flows.
  • Demonstrate the value of your API.
  • Understand when you’re operating a marketplace.

When you’re pitching your API, don’t get mired down in technicalities. Instead, focus on the big picture and how it will help your customers grow and meet their challenges and business needs.

Automate Your Sign-Off

APIs rarely launch without a glitch. Harmon recommends creating an automated testing system so that the inevitable bugs can be added to the automation platform. This way, they’re only a problem once. When polled, only a few of the developers in attendance were using automated sign-offs. This is clearly an area that needs a bit of attention for many companies.

Documentation Is Important

API documentation is what developers use to know how to interact with your API. It’s also often the first point of contact for most users. Harmon recommends hiring dedicated technical writers instead of letting the engineers create the API documentation. The engineers will think of the API from a system-centric attitude, not a customer-centric mindset.

He goes on to give a few reasons why you need good API documentation:

  • It teaches your customers and prospects how to use your API.
  • To define, test, and secure product boundaries.
  • Documentation enables opportunities for customer support.
  • To support technical marketing efforts.

Finally, Harmon wraps up with thoughts on who benefits from good API documentation. For developers, API documentation prevents unnecessary work. It also helps create relationships between developers and potential users, which Harmon calls “shared leverage.” It facilitates a feeling of working towards a common goal. It also helps create a more cohesive organizational mentality, helping various stakeholders understand your API and how it can be used to meet their goals.

Good documentation also helps facilitate better relationships with your users, increasing adoption rates. Last but not least, API documentation boosts your company and API’s reputation, proving that you are thorough, dependable, and business savvy.

Final Thoughts on APIs-as-a-Product

APIs aren’t just for engineers anymore. Developers make up just a portion of the API ecosystem. At this stage, APIs are also an established and essential component of the business world.

This means you need to think of your API user not only as a developer or engineer but also as a product manager and marketer. This will set you and your API up for success, providing real value and delivering an excellent user experience. Your customers will thank you in kind, becoming loyal users and brand ambassadors, spreading the word-of-mouth recommendations that will help you flourish and grow in today’s crowded API marketplace.