Calculating ROI — Return on Integration

Cloud services and open APIs are the darlings of the software world. A company can focus on a key service or solution and pull in complementary services from across the web. No need to try to displace an incumbent cloud storage platform when all you really care about is {insert-your-value-proposition-here} .

End-users have caught on too; expecting their services to talk to each other, even if they have to manually connect them via Zapier or IFTTT.

But if you’re a software provider, you have a plethora of possible integrations to enable. How do you determine the value of offering an integration?

Even what seems like a straight-forward integration takes effort to create, maintain and promote. Is it worth it?

Consider first what you’d hope to achieve with a successful integration. Integrations can serve as a tactic to help with many of Dave McClure’s Pirate Metrics (Acquisition, Activation, Retention, Revenue, Referral). So before you throw your developers at a technical problem, be clear on which business objective you’re trying to meet.

Objective: Awareness/Acquisition

Although this effect is fast diminishing as app stores explode, creating an app and launching it in a marketplace can be considered a form of technology-driven marketing. If an existing Slack user searches for time-tracking and you happen to have an integration, their barrier to trial is lowered as you already integrate with their workflow.

Works great if: your product is self-explanatory: easy to try and recognize the value of.

Not great if: your product requires a lot of configuration, or the user is not the same person as the buyer.

Objective: Retention

Again: by creating an integration within frequently used tools, you can help keep your product top-of-mind and “in-context”.

Many customer engagement tools like MixPanel and Intercom shine when the product is using your product, and they fall back to email, as an out of context contact mechanism. If your target custoemr spends his time in another workflow tool, you want to be there too.. This could take the form of onboarding via a conversational agent.

Objective: Revenue

Integrations can also be a way to capture value from your customer, as it helps them self-segment.

A few years ago, I spoke with someone who was working on a platform that integrated with Evernote Premium. His target customer was someone who already already committed to pay for Evernote, to be a power user. He recognized that willingness to pay for one productivity app rendered the customer more likely to use and see the value in his app as well.

Another example is having premium integrations (Salesforce, for example) only available at higher pricing tiers.

Introducing integrations may seem obvious, but the costs add up. Be clear on your goals for the project, so you can weigh the costs against the possible returns.

Sr UX Specialist with Canada Revenue Agency, former web dev and product person. 🔎 Lifelong learner. Unapologetic introvert. Plant-powered marathoner. Cat mom.

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