Why your API may be a better investment than your App
Welcome to the Supermarket Age
It seems like just yesterday when the mobile app became the most important way in which humans interact with content, data, people, and technology in general. The numbers don’t lie; we are using our smartphones more every day.
But as we peel back more layers of the data, we find an interesting statistic— we’re spending more time in apps, but we’re doing it in roughly the same ones. Some would say we’ve reached “peak app.”
“The real estate war on your phone has largely been won. The next battle will be for shelf space.”
It’s fairly easy to demonstrate this trend anecdotally — do you use as many apps on your phone today as you did during your honeymoon with it? Nowhere is this app-athy (sorry, I couldn’t resist) more evident in the plethora of apps being introduced with the dawn of the Internet of Things. Do we really expect people to use a separate app to control each brand of Internet connected lightbulb they’ll own?
There are likely many reasons for this decrease in app diversity, but this trend is unlikely to change. The real estate war on your phone has largely been won. The next battle will be for shelf space.
Welcome to the Supermarket Age
Apps today are like boutique stores — each one striving to be unique, creative, bespoke, and memorable. And while many of us enjoy the boutique experience, it’s pretty clear they are dying while companies like Amazon thrive. Time has simply become too precious for the average person to spend all but a small amount of it outside their routine. During the mobile honeymoon we could justify that time as entertainment value, but the novelty is wearing thin.
Retail commerce began on the tailgate of a horse drawn carriage and ended in robotic warehouses large enough to create their own weather. The future will be no different for mobile. Apps like Facebook, Instagram, Slack, Twitter, Snapchat, and Messenger will continue to gobble up our time like Walmart gobbled up our local stores. You can try to fight them, but your time is better spent discovering ways to get on their shelves.
“… ask yourself: do I want to compete against supermarkets, or do I want to become their best selling product?”
This supermarket future may sound dystopian, but it doesn’t need to be. Good apps will continue to be wildly successful, but success will become increasingly difficult and at some point you will need to ask yourself: do I want to compete against supermarkets, or do I want to become their best selling product?
Most of the high value brands on earth are not boutiques. They are juggernauts because they have distribution. They come to customers rather than relying on customers to come to them. To put it simply: there is more opportunity for your business to grow as a well distributed product than as a boutique.
How do you get space on these digital shelves?
Enter the API
At a high level APIs aren’t really all that different from apps. APIs still provide functionality and services to users, but they do it in a more open and universal way. A well designed API is a lot like a shipping box— a cost-effective way to distribute unique things by taking advantage of an efficient, and sprawling infrastructure built to deliver things to people at any time and place.
APIs allow you to reach people in the routine of their daily lives. In fact this may be a large piece of the puzzle as to why chat, message and voice bots are all the rage. It’s debatable if voice and messaging interfaces are the best (or even good) user interfaces, but we do spend a large part of our day communicating with other people. So it would stand to reason that many people would prefer to interact with products and services in the same way. For example: Slack may appear like a communication service, but it’s pretty clear they are gunning to become another “operating system” with a thriving ecosystem of apps. With iOS or Android you use your fingers. With Slack you use your words. In either case, you’ll need an API to be a part of the budding voice and chat (r)evolution.
A great API also enables you to strengthen a product by combining it with others. Companies like IFTTT and Zapier have created powerful networks of APIs that when tied together result in user experiences where the whole is greater than the sum of its parts. You’ll be able to throw a lot of spaghetti at the wall to see what sticks when your users become free members of your R&D team.
An API as a business?
“My business won’t work as an API.”
At first it might seem strange or impossible for your business to function in whole or part as an API, but don’t let that discourage you. The business graveyard is full of obituaries that read, “Last words: my business won’t work on the Internet,” and APIs stand a good chance of being a modern analog. According to the Harvard Business Review, “Salesforce.com generates 50% of its revenue through APIs, Expedia.com generates 90%, and eBay, 60%.”
It will be difficult to give up the control and individual attention you get with a boutique, but if your product doesn’t attract attention when it’s on a shelf being passed by millions of people, how can you expect it to attract any attention when it’s only available in a single store?
“What about my brand?”
An API doesn’t mean having to sacrifice your brand identity. Coca-Cola helps countless supermarkets, convenience stores, restaurants, and movie theaters make billions without weakening their brand in the slightest— just like Expedia.com does for the travel industry. You don’t have to ditch your boutique either— there is nothing wrong with a flagship store on 5th Ave.
It’s about distribution
But let’s be realistic, an API does not equal success. Many companies are still struggling to monetize their APIs (coincidentally they are usually struggling to monetize mobile as well). You will fight the same battles for recognition and placement in a competitive market as you do with your app. But if you have something truly worthwhile and useful you’ll be well positioned to take advantage of an enormous network for distribution. You’ll reach users in places, times, and ways you never could with an app alone.
Contact the author: https://www.linkedin.com/in/jheising/
