The Economic enefits of the Postman API Platform
Transcript of The Economic enefits of the Postman API Platform
© 2020 by The Enterprise Strategy Group, Inc. All Rights Reserved.
This ESG Economic Validation was commissioned by Postman and is distributed under license from ESG.
By Aviv Kaufmann, Senior ESG Lab Analyst and Stephen Catanzano, Consulting Analyst
May 2020
Executive Summary
As the demands from modern applications continue to increase, organizations move rapidly toward being more software-driven and digital. Effective API development, collaboration, and maintenance are essential enablers for applications looking to provide a consistent and seamless end-user experience across a number of constantly changing underlying services.
ESG validated that the Postman API platform provides an essential toolkit for organizations that helps to streamline and accelerate the development, collaboration, delivery, and maintenance of APIs. Two core benefits include faster time to value, which creates earlier revenue streams, and quicker resolution of issues, resulting in lower risk, fewer bugs, and increased customer satisfaction. ESG found that Postman customers have seen significant gains in productivity, security, and collaboration through the ability to consolidate and manage all of their APIs’ collections in one central place. ESG predicted that a modeled organization could reduce the cost of API testing by 3.6x and API development by 1.9x by using Postman. By using Postman and also implementing an API-first development strategy, organizations could save even more by reducing development time and cost by 4.7x. With Postman, organizations can develop new APIs, monitor existing ones, and perform ongoing testing to eliminate any possible downtimes or slowdowns that could lead to a loss of revenue or customer dissatisfaction. A strong confidence factor was also witnessed in individual developers and development teams using Postman.
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ESG Economic Validation
The Economic Benefits of the Postman API Platform
Economic Validation: The Economic Benefits of the Postman API Platform 2
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The Importance of Application Programmable Interfaces (APIs)
We all transparently use APIs every day. APIs have become the building blocks of all modern software and form a network
of technical, people, and business relationships. The demands of digital transformation and the related need for platforms
and ecosystems make it essential to automate the management of APIs throughout their lifecycle. When working properly,
API consumers don’t realize that these networks even exist, but when there are flaws, they appear in the form of reduced
productivity, customer service issues, downtime, poor site performance, and the potential for lost revenue. This is
especially true in online businesses, banking, and ecommerce, where transactions are happening in real time.
Figure 1. Modern Applications Rely on Solid APIs to Deliver Positive End-user Experience
Source: Enterprise Strategy Group
REST APIs have abstracted away much of the complexity of working with system APIs, enabling the value of APIs across
distributed hypermedia systems and removing much of the burden of developing for a specific platform or protocol.
RESTful APIs power the majority of today’s modern applications from Stripe APIs for payments, Twilio APIs for
communication, and Uber APIs for transportation, to Google APIs for mapping and other functions. The simplicity around
almost all of the modern applications that we interact with every day from Netflix and YouTube to Amazon and Facebook
are made possible through the use of modern RESTful APIs.
APIs are crucial in allowing disparate systems to exchange information, and developers no longer need to build all
functionality from the ground up, instead leveraging quality APIs developed by companies that specialize in specific tasks
that otherwise could take months or years to develop. This improves the security and reliability of new products, and gets
new products, features, and functionality into the hands of consumers faster than ever before.
APIs have become the critical catalyst that drives modern businesses. Consider that most travel sites generate more than
90% of their revenue through APIs by connecting buyers with hotel, airline, and rental car inventory. This is also true of
eBay and Alibaba as leading marketplaces and nearly every type of ecommerce site. Further, most organizations are
leveraging external APIs while simultaneously exposing key business value via public-facing APIs. This allows them to focus
their development and business efforts in areas where they have the most expertise and value to deliver, while leveraging
best-in-class solutions in areas that are not their core competence.
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The Challenges of Traditional API Development, Testing, and Support
As the API economy continues to expand, more challenges are created for developers. The old methods of manually
creating and testing APIs no longer scale as today’s software and services can interface with hundreds of APIs within a
single application. Development, testing, and delivery teams must work together to make sure that applications work
seamlessly with APIs to provide a business advantage, rather than cause a business obstacle. Collaboration and operational
efficiency are the keys to delivering modern API-powered applications. As IT organizations look to modernize through
digital transformations efforts, it comes as no surprise that ESG research reveals that the most common objective for
organizations’ digital transformation initiatives is to become more operationally efficient (see Figure 2).1
Figure 2. Most Important Digital Transformation Objectives
Source: Enterprise Strategy Group
At the same time, security remains one of the main concerns for any organization. ESG research shows that the most
common consideration for justifying new IT investments reported by organizations in 2020 is improving security/risk
management.2 Many security breaches can be traced to exploitation of APIs that are designed improperly or not updated.
In an ESG survey, 24% of organizations reported that over the last 12 months they had experienced an attack that resulted
in the loss of data through the insecure use of APIs.3 Poorly managed APIs can provide pathways to data breaches or data
loss that negatively impact the company’s reputation and finances, not to mention harm their customers. Keeping your
connection with another system safe requires control and constant enhancing. Data breach methods are getting more
sophisticated, which means secure development and integration is required. This makes solid design, testing, and
monitoring crucial requirements for API development.
Flawless integration of an API module requires having a wide range of tech knowledge and keeping on top of the latest
trends in API building. This process requires the right skillsets and is highly time-consuming, since the task involves a great
deal of scrutinizing. There is a wide variety of software and API architectural styles. Given the fact that every system has its
own specific logic, every integration has its unique challenges. When it comes to integrating with multiple platforms, a lot
1 Source: ESG Master Survey Results, 2020 Technology Spending Intentions Survey, January 2020. 2 ibid. 3 Source: ESG Master Survey Results, Leveraging DevSecOps to Secure Cloud-native Applications, December 2019.
28%
38%
41%
49%
55%
Develop entirely new business models
Develop new innovative products and services
Develop new data-centric products and services
Provide better and more differentiated customer
experience
Become more operationally efficient
What are your organization’s most important objectives for its digital transformation initiatives? (Percent of respondents N=619, three responses accepted)
Economic Validation: The Economic Benefits of the Postman API Platform 4
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of time and broad expertise is required to learn each of the systems. With multiple integrations, each new endpoint will
not necessarily be integrated any faster or easier than the previous ones.
In 2019, ESG asked the question in a research survey, “Which of the following types of threats are of greatest concern for
your organization when it comes to securing the use of serverless computing?” 32% of the respondents replied that API
vulnerabilities were the most concerning, followed by 26% who said exposure of secrets and 22% who indicated the
unencrypted transfer of data was the most concerning.4 These replies present some of the challenges that were echoed by
our interviews with clients of Postman about why they chose to use Postman to manage their public, private, and partner
APIs. Other concerns uncovered from our interviews were identifying bugs in test environments before going to
production, eliminating downtime and productivity losses, addressing governance issues, and fixing broken workflows.
These are not just technology problems; they are collaboration problems. APIs tie internal teams and business processes to
resources. When workflows break, the business is affected.
The Solution: The Postman API Platform
Postman offers a complete toolchain for API development, management, and maintenance all in one secure place. This
saves developer time and encourages communication and collaboration.
Postman helps teams solve collaboration problems. The need for collaboration has grown and changed as APIs have
become more integrated with services and even become products themselves. API consumers are no longer just
developers. They are customer support, go-to-market, and developer relations teams who need to stay up to date on the
latest changes. Management of APIs through Postman has become a critical part of the value chain to deliver collaboration
by interconnecting private, public, and partner APIs with internal teams and partners. The Postman platform offers a full
suite of capabilities, as described in Figure 3.
Figure 3. The Postman API Platform
Source: Enterprise Strategy Group
4 ibid.
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The Postman platform consists of the following interfaces and services:
• Client interfaces: Allow users to explore and test their APIs using Postman’s web and desktop client, and use
Postman’s CLI to execute collections directly from the command line.
• Partners: Let users search and discover new APIs and integrations in Postman’s extensive API directory and
prebuilt connectors. Example partners include PayPal, Box, Twitter, Okta, and many others.
• Enterprise: Helps to create a secure and governed API testing and deployment environment with SSO, user-based
access controls, dedicated IP addresses, and audit logs.
• Collaboration: Allows users to share collections among their team and partners, and collaborate on APIs by
setting up user permissions, teams, and workspaces.
• Lifecycle: Postman can be used to manage the end-to-end API lifecycle, from design, mocking, testing, and
deploying, all the way to maintenance and deprecation.
• Mock servers: Postman provides two different types of mock servers: public mock servers for open source or
individual projects, or secure private mock servers for testing responses from public or private APIs.
• Runtime: Postman’s Platform Runtime Services allow users to manage their API collections, workspaces,
examples, and environments.
ESG Economic Validation
ESG’s Economic Validation process is a proven method for understanding, validating, and quantifying the economic value
of an IT industry solution. The process leverages ESG’s core competencies in market and industry analysis, forward-looking
research, and technical/economic validation.
ESG performed an in-depth analysis of Postman’s value proposition and the impact of its technology on its customers to
understand hard and soft cost benefits. For the interviews and analysis, ESG looked at three use cases, which were API
testing and automation, developers’ experience, and API-first development. In all cases, ESG found customers using
private, public, and partner APIs in their networks.
Use Case 1: API Testing and Automation
Organizations are challenged with developing an automated testing process for their APIs. To effectively run a mission-
critical application, the health of every API is important to avoid any downtime, slowdowns, or security issues, which can
ultimately result in the loss of revenue. Relying on manual testing processes is risky. For testing, a developer has the
challenge of initially setting up the API test environment and then:
• Updating the API testing schema: The schema is the data formatting that handles requirements and requests for
the API.
• Testing all possible parameter request combinations: It is very crucial to test all the essential parameter blending
in the API for flaws about specific configurations.
• Validating variable parameters: Validating the parameters is one of the most essential tests to demonstrate how
fast you are serving all parameters.
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• Tracking system integration: Finally, this challenge ensures that the API system is working properly with the data
tracking system. This is critical to bring back correct responses on whether a call is working accurately. It is also
utilized to examine APIs’ performance.
• Monitoring and maintaining: For support, one critical support function is maintaining and upgrading APIs. When
a connection between a system is established, it is not the end of the story. You will need to monitor systems and
take care of integration maintenance and upgrading. Otherwise, any functional changes made can alter the whole
process of data access and manipulation, which may result in system downtime.
To validate the effectiveness of Postman’s automated API testing, ESG interviewed a retailer in the trendy online personal
stylist space. The retailer was challenged with moving from a manual testing process to full automation with a goal of
delivering higher quality and to free up the teams’ time for other activities. Its application allows both men and women to
work with online stylists, who design personal wardrobes that the retailer then delivers. The retailer receives more than
2,000 orders every day through the website and mobile app. The systems run on Amazon Web Services but are
transitioning to Microsoft Cloud. More than 80 microservices are running in the environment.
Our discussion focused on the online catalog, which is supported by a
team of software engineers and an analyst focused on bridging the
divide between the technology team and the business stakeholders in
the organization. The APIs are set up with 12 critical services, each with
different test scenarios. For example, the shopping cart service has 40
different test scenarios to determine if it is functioning at its highest
performance during a normal volume flow and when volume is
increased during the holiday seasons. This level of performance testing
is critical for the organization.
ESG validated that, after moving to automated API testing with
Postman, the organization can now test and validate APIs quickly and
easily through its QA testing process, which includes processing,
validating, and receiving API responses. The automated process is done
on the 12 critical servers and against hundreds of preprogrammed
scenarios. All of the guesswork is eliminated from the equation. If a
bug is found, it can be identified and resolved. In between testing,
monitoring and visualization tools are used to report on performance
and any security concerns.
The top four Postman benefits reported by the organization were:
• User-friendly collaboration: Between business stakeholders, QA,
developers.
• Transparency: Truth of what really works before it goes into
production.
• Confidence: Increased team confidence in technical skills.
• Time savings: Transitioned from a manual to a fully automated testing process.
Why This Matters
Quality control in a development environment prevents making and repeating mistakes in development. The optimal test organization runs a deeper test suite, runs more iterations of variables, finds more bugs, and helps developers minimize the time to remediate.
With Postman, APIs become the source of
truth, testing and monitoring can be
automated, and information and data are
shared between testers and developers in a
common workspace around the API. This
results in improved testing capacity and
effectiveness for the organization and a
higher quality API.
Economic Validation: The Economic Benefits of the Postman API Platform 7
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An added benefit was noted in cloud transitions. With Postman, the organization found it easy to move from one cloud
provider to another with no downtime. Using collections, the APIs are simply redirected from one place to another and can
then be quickly tested.
As seen in Figure 4, the organization reported a 100% improvement in testing and quality assurance and greater than 50%
increase in overall productivity. All manual processes have been eliminated and the team now has 100% confidence in its
ability to deliver the highest performance (even in peak operating times) and avoid any downtime, which they estimate can
cost more than $90,000 per hour. The team is now more effective, and they can detect and remediate performance and
security issues quickly, and testing is automated and broad.
Leveraging the validated improvements reported by the customer as assumptions, ESG created a modeled scenario that
shows how a team of 40 test and QA engineers focusing on API testing can save a total of $3.1M annually in team
productivity by using the Postman platform instead of manual processes. This productivity savings can be redirected
toward performing more comprehensive testing and working better together with developers to help remediate issues
faster and maintain a better end-user experience for customers.
Figure 4. Modeled Productivity Savings Provided by Postman for a Team of 40 Test and QA Engineers
Source: Enterprise Strategy Group
One highlight that is difficult to show in a graph is the increased level of confidence reported by the team. By utilizing
Postman, team members are onboarded and brought up to speed quicker, have less concern that they will “break”
something by running a test, and were able to eliminate the stress and worry of going live with an API.
“We pull requests back to master collections. If we need to make changes, we have full version control
which is critical across the software development lifecycle.”
“For testers and developers, we like to say that Postman kind of reduces the fear or paralysis you have
before running something in production. With Postman we know it’s right.”
“Postman schemas act as the Source of Truth and combined with mock server testing give my less
experienced developers a real sense of confidence.”
Economic Validation: The Economic Benefits of the Postman API Platform 8
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Use Case 2: Developer’s Experience
API developers rely on quality APIs. Postman manages all APIs as collections, which become the “single source of truth”
upon which a developer can rely. This allows for teams to effectively work together, collaborate, and accelerate the
development process while maintaining the highest level of quality. Maintaining high-quality APIs is a challenge for any
online retailer or high-volume API administrator. To validate Postman in this environment and understand it through the
eyes of developers, ESG interviewed a Fortune 500 auto parts business with stores nationwide, an online catalog, and an
ecommerce business. The catalog is consumer- and partner-facing and is a
critical part of its business, with more than a million parts, configurations
for vehicle types, and standards to determine the right part for the
purchaser available. Buyers can have products shipped directly to them or
arrange for a store pickup. To support this operation, there are 50 people
on the team, which includes 45 developers.
The organization is challenged with managing hundreds of APIs in 18
different categories. If an API isn’t functioning properly, it results in
degraded performance on the site, potential downtime, and possible lost
revenue. The Postman API Platform is used extensively to manage the APIs. Before Postman, open source scripts were
used and many of the developers maintained their APIs on their own systems. This was very problematic and needed to be
controlled. Testing was also sporadic and not well organized. At first, the Postman Free plan was used, but quickly replaced
with the Enterprise plan after the organization was able to see its full capabilities and its ability to put strong controls in
place for managing and securing the volumes of APIs needed to run the business.
With the Postman Enterprise plan, the organization was able to take these important steps:
• Consolidate all APIs into a Postman Collection.
• Provide secure SAML login access for authorized users. This was critical since 50% of developers are contractors.
• Create Postman Workspaces for team collaboration and consistency.
• Implement QA testing and API management procedures.
With Postman in place, the organization can now:
• Ensure quality control.
• Test APIs in real time with mock servers.
• Enhance and modernize existing APIs.
• Build new APIs with confidence.
• Create fast documentation of every API.
“In our catalog, if the API is not
functional, it is very visible. I
would also say that even small
degradations in performance are
very visible to customers.”
“APIs and Postman’s API
management tools are critical to
our business operations.”
Economic Validation: The Economic Benefits of the Postman API Platform 9
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Postman helped this organization achieve its goal of improved quality and faster time to value. A 20-25% overall increase in
productivity was achieved with Postman along with far greater security
and more freedom to focus on expansion to meet the corporate
business goals.
Developers in this organization saw four core benefits of Postman:
• Increased team productivity and collaboration.
• Elimination of the threat of underperforming APIs and bad
customer experiences.
• Faster ability to identify and fix bugs with monitoring and
visualization.
• Quicker turnaround time to get new changes into the catalog.
To illustrate the effect Postman can have on API development, ESG
created a modeled scenario based on an organization of 10 developers,
spending roughly a third of their time on API-related tasks. Using the
improvements reported by real-world customers, ESG’s model predicts
that the modeled organization would spend 47% less time dealing with
APIs and be able to develop solutions faster at a cost savings of $230K per year. As seen in Figure 5, the time to perform all
testing, debugging, publishing, and documentation have been dramatically reduced through the use of Postman as a full
API management platform.
Figure 5. Modeled Development Time Savings Provided by Postman for a Team of 10 Developers
Source: Enterprise Strategy Group
Use Case 3: API-First Development
By building APIs before writing code, developers can collaborate with efficiency, and produce and ship higher quality
applications. Postman has created a four-phase process designed to accelerate development through parallel processes,
mock servers, and elimination of many of the dependencies that slow down the validation and testing processes. The four
phases are:
Why This Matters
Ecommerce organizations depend on APIs to interconnect inventory with purchases as the lifeblood of most web-based businesses. Broken or slow APIs immediately result in lost revenue and negatively impact the customer experience.
With Postman collections, the API can be
monitored, alerts triggered, and
problems easily identified and resolved
earlier and faster. This makes developers
far more efficient and results in a more
stable and feature-rich platform.
Economic Validation: The Economic Benefits of the Postman API Platform 10
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1. Specification phase: In this first phase, a new API is created, written, or imported in Postman, which supports
RAML, WADL, OpenAPI, or GraphQL. A developer can track and communicate changes to the API design by editing
and versioning schemas in one central location without having to switch between tools. The schema becomes a
source of truth for API design and development and ensures all teams are working toward the same goals.
2. Development phase: The schema is used to begin development on mock servers as a means of developing without
any dependencies. In this sandbox-like environment, a developer has the freedom to validate the API, create
documentation, and debug the API.
3. Testing phase: In parallel to the development phase, testing can happen to explore APIs through the Postman API,
write tests in Postman using JavaScript, and verify test results in the Postman Collection Runner. While working
with development processes, developers can continuously share updates, along with test results and debugging
information.
4. Deployment phase: The last step is deployment, where tests are integrated into build systems using Newman
(Postman’s command line tool). The artifact is then deployed to production using your chosen development tool
and Postman is set up to monitor and be alerted by email or integrations.
To verify the value of Postman as a platform for API-first development and collaboration, ESG interviewed a large financial
software company, which specializes in accounting and tax preparation software. The company was challenged with
integrating with thousands of banks to collect banking records and other data needed by clients to manage their finances.
As banks have become more automated and security practices have
proliferated, the old way of collecting data was no longer acceptable. To
resolve this, an API expert was brought in and immediately adopted
Postman as the platform to develop an API for the company to be used
as the secure connection to each bank. In addition to needing their own
API, each bank had an API that needed to be linked. In the old method,
there was no way to validate and test the connections to these banks
and issues were found as problems were presented. Once Postman was
introduced and the API was created and stored as a schema, the API
became the “source of truth” and provided the ability to scale
connectivity to each bank. The next step was validating with each bank.
The typical process took 200 days per bank and anywhere from 30-100
issues were found. With Postman, collaboration was increased by
leveraging the API schema and requiring each bank partner to adapt
their API to the new proven schema and then validating in real time and
testing using mock servers. The time for the banks to adapt decreased
by 50%, and with the mock servers, the company no longer needed to
wait for the banks to provide test environments, which was a major
source of delay.
Why This Matters
Traditional API development consists of inefficient and iterative cycles of planning, developing, testing, fixing, and rearchitecting. Developers need to have both client and server functionality developed before any testing can be done.
Postman eliminates the need to build the client side to interface into the server side. With Postman and an API-first strategy, planning, testing, and rearchitecting can happen before development, resulting in one spec that allows development, product testing, and collaboration to move quickly in a very clear direction with confidence. It’s a major time saver.
Economic Validation: The Economic Benefits of the Postman API Platform 11
© 2020 by The Enterprise Strategy Group, Inc. All Rights Reserved.
Several key areas were identified in the interview that highlight the value of API-first development for this customer. At the
core is the API schema as the “source of truth.” Having this to rely on removes guesswork and provides a baseline to
always return to. Next was workspace collaboration, where the company and its bank partners could transparently work
together. This was further emphasized with the ability to use workspaces to simultaneously develop and test with two
different teams and use mock servers as sandboxes rather than relying on partners to provide resources. This increased
the time to value by 2x over the prior process. In the
Postman environment, many APIs could be validated
and tested with no outside dependencies. Finally, the
process to produce documentation once everything
was validated and tested was quick and easy.
Using the same model, methodology, and assumptions
shown in the development case (see Figure 5), ESG
examined how Postman could provide an even greater
level of savings had the same modeled development
organization implemented an API-first development philosophy. By starting from an imported specification that is close to
what they want and creating the API first, the organization could immediately create a mock server to test, refine, and
document the API standard before any code is developed. By creating the API specification before developing code, ESG
predicts that the organization could spend far less time actually developing the code, as developers will be working from a
fully tested and vetted API specification. This saves the developers and testers valuable time in nearly every aspect of API
development, testing, and documentation. As can be seen in Figure 6, our model predicts that the very same organization
that improved development productivity and reduced development costs by 47% by using Postman could optimize this
productivity by developing APIs up to 4.7x faster while saving up to 79% by using Postman with an API-first development
philosophy.5
Figure 6. Additional API Development Time Savings Provided by Postman with API-First Development
Source: Enterprise Strategy Group
5 Improvement and savings reported for Postman with API-first development philosophy compared to the baseline “before Postman” results.
“Postman helps both sides of implementing an
API, the client and server. It’s impossible to
define one without the other. With Postman,
one spec defines it, and now both sides can
work on it without depending on the other side.
It accelerates the whole process. It’s fantastic.”
Economic Validation: The Economic Benefits of the Postman API Platform 12
© 2020 by The Enterprise Strategy Group, Inc. All Rights Reserved.
The Bigger Truth
Over the past years, we have seen an astounding rate in the increase of APIs to connect public, private, and partner
resources. This has resulted in the retooling of many organizations, the introduction of new business opportunities for
existing customers, and the formation of new entities focused on utilizing APIs to become a marketplace or ecommerce
store, or to even deliver media content on demand. Without the use of APIs, these applications could not exist. This
growth and massive adoption rate create the challenge of how to effectively manage this business lifeline in a secure way.
Postman has emerged as a leader in this space with a full understanding of the challenges and need for a solution to
consolidate APIs, securely manage them, and build cross-functional teams for collaboration with all stakeholders, as well as
all of the tools needed to test and deliver APIs with the highest performance and security.
ESG went into the analysis looking for hard cost benefits but found that the real benefits of Postman are measured based
on productivity and quality API output. The common theme we heard from interviews was the increased confidence of the
DevOps teams when they used Postman from knowing that what was produced would be of the highest standards
possible. Their lives have been made easier with Postman, their confidence has been increased, and their ability to expand
more rapidly without fear has been improved. For all our test cases, APIs act as a lifeblood of the organization to connect
buyers with sellers, inventory with demand, and internal stakeholders with data and resources. Postman has also proven
itself with 10M+ developers, 600K+ workspaces, 280K+ APIs created, 50K+ schemas imported in APIs, 300K+ teams
collaborating on Postman, and 1.2M+ Newman downloads per month. They clearly have market acceptance.
While it takes time for teams to fully understand the scope of the tooling and collaboration workflows Postman supports, it
truly is a set of well-thought-out tools that help in every area of API development. Many of the organizations that we spoke
with initially tried it with a single function in mind, but all saw tremendous value across all of the tools once they used
them, and many insisted on bringing the value of Postman with them to new organizations. Postman itself is hugely
valuable to speeding the development of APIs, but when combined with an API-first strategy, the API development process
was improved by 4.7x.
ESG’s models estimate that Postman can provide savings that are 26 to 44 times the cost of the licenses through improved
productivity and faster time to value every month. For growing organizations, this amounts to operational savings by
allowing you to avoid cost by doing more with a smaller team. For established organizations, these savings manifest
themselves in the capabilities of your teams, the quality of the product, improved customer satisfaction, and ultimately
increased revenue. If your business is looking to develop, deliver, and test modern, next-generation API-powered
applications, ESG recommends that you consider deploying the Postman platform to manage, create, test, deploy, and
monitor APIs to achieve business goals, higher productivity, collaboration, and scale for your organization.
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