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October 9, 2018

Learn about APIs Direct Monetization Models

Nicholas
Growth & Product Marketing Leader

You are aware that APIs provide many indirect methods for reducing costs and increasing revenues, such as creation of an agile and integrated IT architecture, construction of an ecosystem for partners and clients, scope of new channels, brand expansion, obtaining of metrics and generation of insights, and shorter time-to-market, among others.In addition to these benefits, APIs can also be monetized and generate revenue directly. Have you considered that in your strategy?

Learn more the main models that can be used to directly monetize the APIs:

Developer Pays

Here, the developer pays to use the API, which should provide them with a use value or the possibility of obtaining income from their users. This model can be divided into a few sub-models:

Pay as You Go

Dev pays proportionally for the amount used. Generally, the value is calculated in API calls or data volume and charged on a monthly basis.

Freemium

Some basic functions are free. To use more advanced resources, higher values ​​are charged separately.

Tiered

Different layers of access and available features (e.g. Basic, Advanced). The developer is usually charged for the selected layer, regardless of use. The lowest layer can be free for the developer to test the API.

Points-based

Different features of the API have different points or credits. The developer buys a defined amount of credits (prepaid) or pays for the credits used (postpaid, similar to pay-as-you-go).

Transaction Fee

A fixed or percentage value of the transactions made is paid by the developer.

Developer gets Paid

In this model, the use of the API is very important for the provider, and the developer is paid as an incentive for it to happen. It can be divided into:

Revenue sharing

The developer receives a fixed or percentage value of the transaction made with the API.

Affiliate

The partner includes their content / ads to direct the traffic of potential customers to their company, which can pay for clicks, impressions, commitment, conversions, etc.

Referral

Similar to the affiliate mode, but the partner is paid only when the potential customer buys something from their company.

The Sensedia API Platform includes modules to support the creation of APIs with application of modern security mechanisms (such as OAuth 2.0), access plans, billing hits, advanced analytics, technical and business dashboards, Dev Portal (for dev commitment), complete tracing of calls, creation of environments, governance tools, and many other features.

In addition, Sensedia has a consulting firm specializing in APIs and microservices, professional services and a Customer Success team, dedicated to helping your company achieve its objectives and use the best practices in its API strategy.

Thanks for reading!