As more companies realize the benefits of an API-first mindset and treating their APIs as products, there is a growing need for good API product management practices to make a company’s API strategy a reality. However, API product management is a relatively new field with little established knowledge on what is API product management and what a PM should be doing to ensure their API platform is successful.
Many of the current practices of API product management have carried over from other products and platforms like web and mobile, but API products have their own unique set of challenges due to the way they are marketed and used by customers. While it would be rare for a consumer mobile app to have detailed developer docs and a developer relations team, you’ll find these items common among API product focused companies. A second unique challenge is that APIs are very developer-centric and many times API PMs are engineers themselves. Yet, this can cause an API or developer program to lose empathy for what their customers actually want if good processes are not in place. Just because you’re an engineer, don’t assume your customers will want the same features and use cases that you want.
This guide lays out what is API product management and some of the things you should be doing to be a good product manager.
Understand business justification
Before you can embark on your API product management duties, you should first understand what are the high level objectives with your company’s API initiative. Is this API a core driver of top line revenue such as in companies like Stripe and Twilio, or is the business goal to build an ecosystem of third party developers to build a competitive moat and expand your market like Dropbox or Box?
Developing an API for the sake of development may work as an independent study project, but will end in disaster for most companies that need to generate revenue. As an API product manager, you should be listening carefully to what your customers actually want, whether these are internal teams or external developers for a public API program. This can be especially hard for API platforms since there are many stakeholders involved. You have the individual developer deciding to adopt and use your API, but you also have the decision maker that has final authority on whether to move forward with an enterprise agreement. You may also have end-users of the final application which you may talk with also.
Become literate in API metrics
Your efforts as a PM would not hold any weight if there were no metrics and KPIs attached to them. Like any product management role in 2020, just shipping features based on gut feeling or a small sample of customers does not cut it anymore. Your metrics should be aligned to product goals such as engagement or retention. This avoids the trap of relying on vanity metrics like page views or requests per minute which are aligned with marketing and engineering teams, but not product teams. For more info check out What does API Monitoring Mean for API Product Managers and Growth Teams
Usually API product metrics are aligned to one of three areas:
- API adoption
- API engagement/usage
- API retention
Once you understand the high level business objectives, you can create your internal goals and focus areas for you and the engineers. I would then spend quite a bit of time understanding different use cases for both the existing or upcoming APIs. This can be a combination of looking into current API usage data you may have, but also interviewing customers directly. You want an understanding of both the different endpoints and features customers use, but also what their end goals are. Are these APIs used in a mobile app? Are they used mostly internally by partners or internal teams? This way you can start mapping out different customer personas. Is this an API that is sold/revenue generating? If so, ask the sales team for some phone calls or data on what prospects are asking for. If internal, have a few (WFH) lunch sessions with other teams to see what they are building.
Once that’s done, you’ll be able to start planning your platform strategy. Were there any trends you noticed during customer discovery interviews? Always happy to help more if possible.
Skillful at managing the backlog
Project management takes up a significant portion of an API product managers daily responsibilities. Most API teams are deeply technical in nature and will be working on countless bugs, feature requests from customers, and new product initiatives at any given time. Most customers of API products are other businesses rather than individual consumers. This means they’ll have specific requests like custom integration work, handling security and privacy requirements, and helping customers get set up with the platform. With this constant stream of requests, a product manager needs to balance wants from internal stakeholders and product development vs customer requests. If engineers spend too much time on Non-recoverable engineering (NRE), then the long-term product vision can never be realized, eventually loosing out to competition who does move product forward. On the other hand, if too much time is spent on visionary features vs the small things that can help existing customers out, customers are unhappy they are not getting the support they expect causing churn to creep up and lost revenue. Using tools like Jira or Pivotal Tracker can help manage these requests from various stakeholders and ensure product schedule doesn’t slip.
Understanding usage-based packaging and pricing
While not the same, APIs and SaaS are many times items heard together. Part of being a good API product manager is having a keen understanding of different packaging and pricing schemes used in SaaS products. Most APIs have some sort of usage based element whether that is number of transactions per month, monthly tracked users, or some other value metric your API is priced on. While some API products can employ a pure transactional pricing model like 5 cents per message, most API platforms package their product in tiers that contain a collection of features and usage quotas for a target audience. Good API product managers know the tradeoffs between pure transactional vs tiered pricing and what are good value metrics to price on. For more info on how to manage self-service pricing, review How to Launch a New Developer Platform That’s Self-Service
Being empathetic to developers
For most API products, either the end-customer or a stakeholder is a software engineer as most API products require some integration work to leverage it. Building and scaling an API platform can be a daunting task, but always focusing on the best developer experience is critical for a successful product. Having a good developer experience means adding features to your product that can nudge a developer along and enable them to be successful with your API and includes things like a low-friction onboarding flow along with up to date and easy to comprehend developer docs. Developer experience includes other items like a public changelog and status page to document changes and outages to your platform. Small things like embedding a developer’s API key in code samples during onboarding and providing debug API logs can go a long way to making your API developer-first.
Understand enterprise security and compliance requirements
Most APIs need to be secure and also be compliant with various privacy and industry-specific regulations such as GDPR and CCPA. This may require certain API features to ensure your own company is compliant, but also new endpoints to help ensure your customers can reduce their own compliance burden. For more info on compliance features, review CCPA Requirements And Compliance Checklist for API Programs
Behind many public and internal APIs is many times a database which could contain a large amount of customer or proprietary data. Balancing the compliance needs of large customers in regulated industries vs features that can help individual developers at a start up is critical to avoid having one customer have too much influence on your product road map. If you’re not familiar with the security and compliance features needed for an enterprise API product, take a look at enterpriseready.io
API product management is a new, but growing field in the software industry. Being technical in nature and aligned to SaaS and enterprise software, API product managers require certain traits that are usually not needed for consumer-focused companies. Working with a community of developers can be super exciting and fulfilling, yet requires great care and empathy.