You have probably heard the acronym. But what exactly does it mean and how does it affect ecommerce and our everyday lives?
API stands for Application Programming Interface. An API streamlines interactions between applications by giving them a set of protocols and directions on how to exchange data, or “communicate,” efficiently. They serve as instruction manuals for web developers to build applications so that they can sync with other applications. Without them, the online experiences modern consumers have come to expect would be impossible.
Servers and clients need APIs to exchange information in a compatible way. A server is a powerful computer that unifies and manages a network. The server has a specific API through which it provides data to clients, or systems that want to interact with the server. The clients can request and retrieve data from the server, interpret the server’s API “instructions” and then translate the data instantly so that it’s readable on their side to end-users. While APIs facilitate software-to-software interoperability, they remain hidden to people who initiate the data exchange by surfing the web or using applications.
More and more companies are publicly sharing their API codes to allow developers to create software and programs that work in harmony with existing ones. Both benefit from increased brand visibility and site traffic. For instance, Google Maps and YouTube APIs let web developers embed interactive maps and videos, respectively, on outside websites.
Product information APIs. These allow websites to use product information—descriptions, product IDs, prices, buyer reviews, images and more—from other ecommerce websites. Amazon’s Product Advertising API is one example. It gives developers access to Amazon’s product database so that they can display and even sell Amazon products on other websites.
Social proof APIs. Social proof is a persuasive marketing tool that utilizes the bandwagon effect. Businesses can show potential customers that what they’re about to buy is trusted and liked by others. Testimonials, celebrity endorsements and impressive numerical data, such as amount of units sold, are common ways to amplify the perceived value of whatever the business is selling. To boost social proof, websites can link to social media applications through APIs and promote easy sharing between the two. For instance, Facebook’s “Share” button is integrated into many other websites through an API, so users can transfer information from different websites onto their Facebook accounts with one click rather than copy and paste a URL.
Site search APIs. An example of a site search API is a travel booking site that collects information from a variety of sources and displays it instantly to a viewer. When a customer is trying to book a flight or hotel, a travel site’s API allows it to fetch data from a range of different hotels and airlines to give the customer options quickly in one place based on their search criteria.
Personalization APIs. These pull content from a variety of sources to customize an individual’s account based on personal interests. Applications can gather insight by tracking trends in user activity, even across multiple applications, and then use predictive ways to present or recommend information or services to that user.
Marketing automation APIs. APIs are the foundation of marketing automation, which can take the form of an automated live chat to answer questions a viewer has when visiting a website, email and text marketing, or other strategies that expedite mass communication with customers and conserve resources in the customer service and marketing departments.
Shipping APIs. By bringing together different players involved in the shipping industry, shipping APIs allow customers to compare carrier rates, buy labels, track packages, confirm addresses and more in a simple visit to one website.
Price comparison APIs. These give customers an avenue to search for the most cost-effective option of whatever they’re buying without having to visit lots of different websites. Price comparison APIs are able to extract information from different retailers and display prices of the same or similar products or services in one place.
Recommendation engine APIs. Buyers can review products, services or businesses and share their thoughts easily through recommendation engine APIs. Websites like Yelp and TripAdvisor can share customer reviews and ratings on other websites and present them in an order that makes sense to viewers.
Affiliate APIs. A merchant can transfer information to its affiliates (branches or business partners) in real time through an API. It allows affiliates to automatically integrate product information, updates and anything else from the merchant’s website onto their own without having to do any manual linking. The merchant’s products can be advertised without having to redirect the customer with a URL.
Anti-fraud APIs. Businesses can use APIs specifically designed to thwart fraudsters and prevent chargebacks. Anti-fraud APIs can detect fraud by showing alerts for suspicious account activity across multiple locations and checking order information against databases of known fraudulent accounts.
API technology benefits anyone involved in ecommerce. It allows businesses to develop applications that integrate with other systems to give end-users an efficient, convenient shopping experience. API data exchange is accurate because it eliminates the margin for human error when linking two applications and it happens in real time. It centralizes resources and creates automated connections between websites that would otherwise be complicated to manage. Simple Object Access Protocol (SOAP), Remote Procedure Call (RPC) and Representational State Transfer (REST) are a few different web API models.
APIs factor into the functionality of payment gateways by allowing businesses to interact with customers in more than one place. Any customer who accesses a website on a mobile device or desktop can use the same payment gateway API to securely make a transaction. Instead of redirecting a customer to another website to make a payment, an API allows a website to host a payment form that’s directly connected to its secure payment gateway. In addition, the payment gateway’s API integrates with other website plug-ins, such as shopping carts, creating one seamless checkout flow for customers. Simplifying the payment process with API technology leads to a higher conversion rate of shoppers into buyers.
On the other side of the sale, the business can receive real-time customer data, such as buying habits, from the API to guide smart marketing decisions. By expanding application access and efficacy for consumers, APIs have revolutionized ecommerce solutions.