Self-Service and Freemium Are Important to the Success of APIs
20 Oct 2011
At a recent presentation at the Business of API conference in San Francisco, Twilio CEO Jeff Lawson argued that two of the ways APIs can be successful in courting new developers are by being self-service and by having a "freemium" option. Both of these features empower developers to start using an API right away, without entering a credit card, talking to customer service, sales or having to wait for budget approval. They can just sign-up, get a key and start hacking!
This shouldn't just be a model for APIs targeting the public developers; it can work with the enterprise as well. This model would allow enterprise developers to get up and running using an API quickly, building their own working prototypes, and in turn, using this prototype to make a case for why a company should use an API -- all without talking to their boss or getting approval.
Of course, an API can still have a traditional sales funnel, where developers can get support, pay for premium services, and engage to get appropriate SLAs. But by providing both a self-service and a freemium option, there is the potential to reach new customers -- customers that may not respond to a traditional enterprise software sales cycle.
I strongly believe that both self-service and freemium have a place with all APIs. These help expose what is needed for developers to see the value an API delivers so they can prove this value to their company; then later, they can engage sales and business departments to strengthen and harden the relationship.
This approach is gaining acceptance and can be seen across many of the successful APIs in the space, like Twilio Self-Service and freemium pricing are things that all the major API service providers (3Scale, Mashery and Apigee) endorse when they advise their customers during setup of their own APIs.
APIs open entirely new channels, attract new customers, and encourage the development of new ways of doing business you could never even imagine on your own! Right? Yet only 3Scale and Mashape actually offer truly self-service, freemium options for their API management platforms. At Mimeo I've deployed entirely new APIs I can't get internal resources for, and I've done so using both 3Scale and Mashape. With their platforms I've built new document printing APIs. I launched these without the help of IT. By doing so, I’m attracting new users and in turn evangelizing internally at Mimeo to get greater buy-in and budgets -- all without engaging with sales, spending money, or getting my budget' approval.
The enterprise can learn a lot from open APIs. Idon't think the traditional enterprise sales process is all bad; it has its place, but it doesn't offer the transparency that is needed in many cases, and where I think many businesses feel they are protecting their intellectual property and delivering a stronger product, they are actually missing the boat on a lot of new business.