Build Your ExperienceThe business case for APIs.

Communications platform as a service (CPaaS) solutions simplify the integration of communications capabilities into applications, commonly through the use of APIs. Once reserved for larger companies with more resources, communications APIs are now accessible to virtually any business. From doctor’s appointment reminders to delivery driver ETAs, CPaaS is everywhere.

Gartner analyzed the use of messaging tools in the retail sector, and the research shows use cases are becoming more sophisticated. Until this year, usage has predominantly been one-way correspondence like notifications and reminders. As the ’20s progress, retailers are¹ incorporating multimedia messages, new digital customer service channels and additional payment methods, all through APIs.

Given the dramatic change in how we do business over the last year, now is a perfect time to begin or expand your CPaaS journey. Many organizations have seen improvements in customer satisfaction scores, increased business agility, and a reduction in fraud issues through the deployment² of one simple API.

This chapter explores how to get started with APIs, the total cost of ownership (TCO) impact of build vs. buy, and provides three tips to help ensure success and a positive return on investment.

CPaaS services now abound, packaged as APIs, SDKs, packaged apps, and more. While these choices can feel overwhelming, there are some easy and low-risk ways to get started.

For the API newbie, SMS is a perfect place to start. SMS APIs are fast to deploy, secure, and have numerous tried and tested use cases.

Use Case 1: Appointment follow-ups

Missed customer appointments are costly for the service industry. Customers failing to make appointments is a major issue for any service business. Sending just 1 SMS reminder per customer could save nearly $300,000 over a 12 month period³.

Use Case 2: Two-factor authentication

Security has never been more important—and visible–than it is today, with data breaches affecting even the largest global corporations on a daily basis. Two-factor authentication is an easy way to provide customers with added protection and help reduce the risk of customer accounts being compromised. In addition to building customers’ trust, two-factor authentication also provides cost savings for your support organization. Assuming each support interaction costs approximately $25⁴, just a 20% reduction in support calls relating to security could save over $400,000 per year⁵.

Use Case 3: Delivery updates

Providing customers with delivery updates and notifications is a proven way to help improve customer satisfaction and reduce costs associated with delivery issues. For example, just a 10% reduction in delivery issues could provide a savings of over $200,000 per year⁶.

When deploying APIs, many companies must prioritize which projects their developers will work on. Performance monitoring for real-time communications (WebRTC) applications as an example is a little bit different, you have the option to build your own solution, or buy a ‘drop-in’ service.

Build:

If you have the resources, building a performance monitoring tool for your specific use case may seem like an obvious choice, giving you complete flexibility and control over the features and functionality. But don’t re-assign your developers without taking into account the total cost, time, risk, and complexity involved. If you invest more, the return has to be that much greater in order to justify the spending. The ‘cost’ when building a solution is in developer time, reprioritization of other projects, and of course financial.

We calculated the total 5-year cost of building a solution, including software, employee, and maintenance costs to be over $1.3m, and this is assuming a fairly conservative FTE (full-time employee) cost of just $19,500 per year. Depending on where your developer resources are located, this could be 10x higher. In addition to the cost consideration, a custom-built solution will be limited by the amount of test data available, vendors who provide data analytics tools or performance monitoring specific solutions can securely and anonymously use the billions of data points collected from their customers in order to refine algorithms and test new features.

Buy:

Tools built to independently analyze voice and video calls provide a unique view into your company's overall communications and any quality issues. Independent performance monitoring tools are designed to be easy to ‘hook up’ to any compatible endpoint, aggregate the information, and provide helpful outcomes, rather than just raw data. By including every potential point of failure in the analysis, such as an agent’s headset, local network, or internet service provider, the time it takes for IT administrators to solve a quality issue is greatly reduced, as the tool can provide specific details and solutions to the quality issues as they arise. In addition, the tool can grow with your company.

Data collected across your organization is invaluable, and by using an easy to integrate flexible analytics solution you can ensure the integrity and availability of the data, regardless of the endpoint or communications application you use. As your company grows and changes it is likely that so will your communication tools. The 10-seat out-of-the box phone solution you purchased as a start-up may no longer meet the needs when you're providing integrated customer service via communications API in your company application. By utilizing a vendor-agnostic data tool, it is possible to change the data source, while keeping the view, calculations, and reports you use to run the business.

The TCO of building a solution is approximately $100,000 more over a 5 year period when compared to buying, but with a much greater year 1 investment due to design and set up costs. Therefore it is important to understand the requirements and objectives of the project when deciding which option is best for your business.

Verbling.com, an EdTech company based in San Francisco recently had this choice to make. Verbling connects language teachers with students across the globe and being able to quickly diagnose video quality issues for their clients is key to the company's success. When evaluating performance monitoring tools, Verbling CTO Gustav Rydstedt considered building a custom solution, but ultimately decided to integrate callstats, due to its easy ‘drop-in’ integration and instant access to the data they needed. Read more about Verbling’s story.

Deploying an unbiased performance monitoring tool not only provides a lower TCO but also provides much greater financial flexibility, smoothing the path to a positive ROI. For your own analysis, use the callstats build vs buy calculator.

Due to the nature of CPaaS APIs, it is easy to end up with a substantial investment—particularly in developer resources and time—not matched by substantial return. Whether you are looking to deploy a performance monitoring tool, add video to your customer service channels or remind customers of their upcoming appointment via SMS, it is important to treat any CPaaS work as you would with a more traditional software or technology implementation.

CPaaS services can feel difficult to understand and deploy, but if you apply some typical project management principles, it can go a long way to being successful and realizing a return on your investment.

Getting started with CPaaS is easier than you think, and following a few simple best practices can help to ensure a successful outcome.

1. Create a plan: Before developers spend any time testing APIs, set out a clear plan including the business outcome you wish to achieve and define the APIs best suited to reach this goal. A plan could include how many hours per week your development team should spend on the project and when the new service needs to be in production.
2. Start small: These days, there is an API for everything. But that doesn't mean you need to deploy them all at once. By starting small, solving a specific business problem and then expanding the use case will ensure buy-in across your business.
3. Don’t forget the metrics: A successful outcome may be something like ‘Send 500 SMS messages reminding patients of their appointment, in order to see a 10% reduction in missed appointments’ When building a solution make sure you include a way to track and monitor metrics in order to measure success.

Now is the time to begin or expand your CPaaS journey with many organizations who have implemented in the past year, see improvements in customer satisfaction scores, increased business agility and reduced fraud issues.

Getting started is easier and cheaper than you think.

When examining whether to build vs. buy, deploy an unbiased performance monitoring tool for lower TCO and greater financial flexibility, smoothing the path to a positive ROI.

Helpful Resources

Build vs. Buy TCO Calculator

Self-assessment: Digital communication readiness, Ventana Research

Open Lab: View APIs and Docs

In the next chapter, we’ll share five tips to increase security when using APIs.They increase your ability to keep your and your customers’ data secure and safe.