Ecommerce / MarTech / Technology / User Experience / Web Development

What is an API and How Does it Work?

Simon Dell
Simon Dell
Reading Time4 minute read

APIs, or Application Programming Interfaces, are a powerful piece of technology that many people may not even know about. But in fact, we’re all using them every single day. 

What is an API?

APIs and the technology behind them has actually been around for quite a while. Essentially, an API is the link between one software system and another. Whether that’s from a mobile phone app to a company’s data server, or even just two business software programs talking to each other. 

An API is like a messenger, or a translator, which allows two programs to talk to each other. On a more technical level, developers use APIs all the time when creating software. This is because the defined set of protocols on most APIs are the same, and developers only need to change certain parts in order to build and integrate applications.

How Does an API Work?

APIs use a certain set of rules that determine how computers and machines talk to each other. This allows the easy and secure flow of data between systems without the need for bulk transfer of information. One extremely common example is Twitter. Now, you have the Twitter app on your phone, but all of your history and data isn’t actually on your phone. That’s held on Twitter’s own data servers. When you open your app, the API tells the data server that you want to access your information, and send it to the app on your phone.

Another example is an API between a retail chain’s inventory and individual store computers. Rather than install expensive software on every computer in every store, a staff member can use an API to check stock availability with head office. They simply key their request into their operating system, and an API sends the request to, and retrieves the information from the main data server.

Public, Partner or Private APIs

APIs can be broken into three different types, being public, partner or private APIs. There are benefits to all.

Private APIs

These are used internally, giving businesses maximum control over their data. Only authorised personnel can use this API for easy data access. For example, it could be the situation above, where a retail store can check stock availability but members of the public can’t.

Partner APIs

Many businesses use partner APIs when partnering with other companies. It’s a great way to generate extra revenue. For example, a hotel chain may partner with a car hire company. The car hire company would allow the hotel to include a car booking function on their website. Customers booking a hotel could then also book a car at the same time. This is made possible by an API allowing the hotel’s website to talk to the car hire company’s booking systems.

Public APIs

With public APIs, of course businesses lose some control over their data. It’s not that the data can be used or altered, but it can be viewed. When using public APIs, security is paramount. The benefits for public APIs are certainly widespread though, which is why many businesses use them.

Sticking with a tourism example, if you’ve ever used sites like Trivago or Hotels Combined, they’re using several APIs. For these ‘finder’ sites to feature your hotel in searches, then your booking system needs to have an API it can talk to. 

As you can see, the benefits of APIs are far reaching. They’re a key part of many of the apps we use today, and the reason why apps can run so smoothly. From a business perspective, they open up the door for a lot of innovation and additional revenue streams. Using APIs can improve your integration infrastructure considerably, while also making owned apps and products more appealing.


Simon Dell
Simon Dell

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