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What are APIs?

APIs (short for “Application Programming Interfaces”) get built into applications in order to send data back and forth, so different software solutions can communicate and share data with each other. Whenever you use an app on your phone, log onto Twitter or Facebook, or use software to communicate with another software, you’re interacting with several different APIs behind the scenes. 

How APIs Work

Most APIs sit between the application and the web or mobile server. The user initiates an API call that tells the application to do something. The application then uses an API to ask the web server to do something else (though APIs are not limited to web services). In this way, the API is the intermediary between the application and web server and the API call is the message or request. The requested data is then populated in the user interface.

Common versions include:

  • REST APIs (short for “Representation State Transfer”) offer fast performance, reliability and ability to scale, and make up over 70% of all public APIs.
  • Browser APIs, which are capable of creating a wide variety of user experiences, depending on the functionality inherent in the browser instance.
  • Mobile APIs (iOS/Android), which facilitate diverse applications and user experiences for mobile devices. 

How Webhooks Work

Webhooks are a type of API that get coded into an application as a means to tell another application or platform when a specific action in the system takes place and allows it to respond accordingly. Webhooks send a message from one application to a unique URL that’s associated with the secondary application. This happens in real time, so the data is delivered immediately; this makes webhooks more efficient than traditional APIs.  Webhooks are useful for accessing data between tools, systems or platforms, especially in the absence of out-of-the-box integration tools. Some of their far-reaching benefits:

  • While APIs place calls even if there’s no data to update, webhooks wait to be called, which means your systems don’t have to process new data—which may not actually be new or updated. This saves processing power and can reduce latency issues.
  • Webhooks are useful to prompt instant notifications, including SMS messaging, reminders of late payments, updates on accounts, etc.
  • Webhooks deliver data immediately, in real time, so CRMs and other systems that employ webhooks for integration will generally stay more up to date than systems that rely solely on APIs.
  • Because webhooks can be set up to respond to events or prompts, such as receiving a payment, they can facilitate better customer service delivery. (An idea: Set up a webhook to let you know when a customer has reached the nth percentage of their performance-driven services with you, so you’ll know when to contact them to re-up their package.)

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