apis and business model innovation, presentation at 1st dutch api community meetup at b. amsterdam...
TRANSCRIPT
Source: http://pandawhale.com/post/61574/something-interesting-is-happening-tom-goodwin-on-uber-facebook-alibaba-and-airbnb
“Uber, Facebook, Airbnb, Alibaba, PayPal. All of them drive their core operations on internet platforms and have astronomically high valuations without any notable physical assets. (…)
These companies are indescribably thin layers that sit on top of vast supply systems (where the costs are) and interface with a huge number of people (where the money is).
And every time a user interacts with these companies’ platforms, cleverly designed APIs absorb valuable information.
To the customer, the interface these companies offer, is the service.
There is no better business to be in.
Based on: http://techcrunch.com/2015/03/03/in-the-age-of-disintermediation-the-battle-is-all-for-the-customer-interface/
Source: http://pandawhale.com/post/61574/something-interesting-is-happening-tom-goodwin-on-uber-facebook-alibaba-and-airbnb
a. Unbundling of propositions
b. Rebundling in the API economy (listen to what your customer needs and see if there is an API you can use to improve your proposition)
The unbundling and rebundling of everything
Get rid of that Keep this
What you offerWhat your customer needs
What you offer
Add that
What your customer needs
a. Unbundling of propositions
b. Rebundling in the API economy (listen to what your customer needs and see if there is an API, you can use to offer a better proposition)
The unbundling and rebundling of everything
Get rid of that Keep this
What your customer needs
What you offer
Add that
What your customer needs
What you offer
Put on your business model canvas glasses and discover where APIs add value in your business model
“A Business Model describes how an organization creates, delivers and captures value for its stakeholders”
You are familiar with the business model canvas… right?
The business model canvas is a tool that helps you describe and discuss your Business Model
http://www.businessmodelgeneration.com/
Value proposition and APIsWhat are you offering them? What is that getting
done for them? Do they care?
b. Your proposition relies on APIs, APIs are the building blocks
a. Your value proposition is the API that others use for their value proposition
“TripAdvisor App Now Helps Travelers Get A Ride With Uber In More Than 40 Cities Worldwide”(Source: http://techcrunch.com/2014/08/20/uber-api-part-deux/http://ir.tripadvisor.com/releasedetail.cfm?ReleaseID=867037)
Location
Payment User authentication
Transport
Company DNA
Channels and APIsHow does each customer segment want to be reached? Through which interaction points?
More than 75% of Twitter traffic is API traffic.
Extend your online presence with Open APIs
APIs are the way to make data and functionalities available to customers and partners
Reach
Agility
Collaborate
Innovate
Internal/private/dark API
Partner API
Open API
Customer segment and APIsWhich customers and users are you serving? Which jobs do they really want to get done?
Businesses (BIG and small) that use your API
Developers that use your APIhttp://developer.<yourbusiness>.com
End consumers
Customer relationships and APIsWhat relationships are you establishing with each segment? What makes them come back for more?
Customer lock in
Personalization
Analytics
Key resources and APIsWhich key resources underpin your business model? Which assets are essential?
API capabilities are a strategic resource
Maturity of API capabilities
API management platforms offer additional capabilities, e.g.
• Security mediation• Traffic Management• Partner Customization• Mobile Optimization• Versioning
• Analytics• Monetization• Onboarding• API Documentation• Developer Authentication• Transformation
Key activities and APIsWhich activities do you need to perform well in your business model? What is crucial?
APIs have there own lifecycle and need to be managed API Management platforms can help you manage your APIs An API team matches APIs with developer and business needs
API TEAM
Source: http://apigee.com/about/resources/videos/digital-transformation-how-create-right-team-0
Key partners and APIsWhich partners and suppliers leverage your model? Who do you need to rely on?
APIs reshuffle value chains and redefine industries
Be an attractive partner!
Your Connectedness
Good Average
Your Quality of
assets
Good ATTRACTIVE Watch out!
Average Watch out!NOT INTERESTING!
GAME OVER
Partner to market new propositions fast
Choose your partners wisely
Collaborate to succeed
Revenue streams and APIsWhat are customers really willing to pay for? How? Are you generating transactional or recurring revenues
Salesforce.com generates 50% of its revenue through APIs, Expedia.com
generates 90%, and eBay, 60%. (source: https://hbr.org/2015/01/the-strategic-value-of-apis)
FreeDeveloper
paysDeveloper gets paid
Indirect
APIs
API revenue streams, e.g.: Freemium Tiered pricing Pay per use Unit based pricing Transaction fee Revenue share Affiliate As an upsell
Source: http://www.slideshare.net/jmusser/j-musser-apibizmodels2013
Source: http://www.slideshare.net/jmusser/j-musser-apibizmodels2013
Some more ways to monetize APIs
API capabilities have a price
API capabilities can greatly reduce costs
Shorter time to market
Lower development costs
Reusability
Productization of (backend) services
Self service
Cost structure and APIsWhat is the resulting cost structure? Which key elements drive your costs?
APIs, API team, API mgt platform
So…
APIs open up new channels
APIs enable new revenue streams
APIs extend partnerships or reshuffle your business ecosystem
APIs enable a better customer experience
APIs increase an organizations flexibility
APIs accelerates (open) innovation and shorten time to market
APIs enable Business model innovation
Business model innovation & APIs
GET STARTED
Understand your current business context and business model (including customers!)
Build your value proposition, looking at your own core assets and complementary partner assets.
Experiment with this proposition, is this what your customers want? (Build, measure, learn)
Define a strategy to capture the value most effectively and scale up
Let’s create!Thank you
ANY QUESTIONS?