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Understanding the Differences Between APIs and Webhooks in Modern Data Integration

In supply chain and logistics ecosystems, data-sharing between applications is essential for efficient information flows and effective operations. At Splice, we apply technologies like APIs and webhooks to provide our customers with real-time, actionable data. APIs and webhooks are related, but what’s the difference between APIs and webhooks, and when should you use one over the other?


Let’s dive into the distinctions and use cases for these powerful tools.


APIs and webhooks are related, but what’s the difference between APIs and webhooks, and when should you use one over the other?

What is an API?

An API (Application Programming Interface) acts as a bridge between two systems, allowing them to communicate. APIs enable one application to request data or perform an action in another application by making a call, often referred to as a "request."

  • How It Works: APIs function on a "pull" model. The requesting system asks for specific data or performs an action, and the providing system responds with the requested information or confirmation.

  • Example: Imagine your application needs to check the latest shipment status, like an export receiving date or the estimated vessel arrival. By calling a marine terminal’s API, you can retrieve the current status whenever you need it.


Key Features of APIs:

  1. On-demand data retrieval.

  2. Requires continuous polling to stay updated (which can be resource-intensive).

  3. Well-suited for use cases where you can control the timing of data requests.



Key Differences Between APIs and Webhooks

Feature

API

Webhook

Data Flow

Client-initiated (pull model)

Server-initiated (push model)

Timing

On demand

Event-driven, near real-time

Efficiency

May require polling (relatively heavier)

Lightweight (no polling required)

Complexity

Requires explicit requests

Requires endpoint setup and monitoring


What is a Webhook?

A webhook is an automated mechanism that sends real-time updates from one application to another without requiring continuous requests. It relies on API infrastructure to operate, but it operates on a "push" model, delivering data to a predefined endpoint whenever a specific event occurs. Typically, the push comes after an initial request to subscribe to the certain changes.  


  • How It Works: Webhooks are triggered by events in the source system. For example, when a container gates in or gates out of a terminal, the system automatically sends a message to the receiving endpoint.


  • Example: In our export tracking workflows, a webhook can notify Splice Exports whenever new data about a booking becomes available. This could include a booking rolling to a new vessel or having a revised cut-off date. Webhooks ensure that our customers have immediate access to the latest updates.


Key Features of Webhooks:

  1. Event-driven updates in real-time.

  2. More efficient, as it eliminates the need for constant polling.

  3. Ideal for applications requiring instant data synchronization.



When to Use APIs vs. Webhooks

Use APIs When:

Use Webhooks When:

You need on-demand access to data.

You need real-time updates triggered by specific events.

The frequency of updates is infrequent or irregular.

Reducing resource consumption is a priority.

Polling for changes is acceptable.

The integration involves high-frequency updates.



How Splice Exports Leverages APIs and Webhooks

Splice integrates APIs and webhooks to offer dynamic data flows that best suit the situation. APIs allow us to pull data from multiple systems to perform move data effectively based on needs, while webhooks enable real-time updates for shipment arrivals, bookings, and other time-sensitive events. By combining these technologies, we ensure our customers always have access to the most accurate and up-to-date information. 


APIs and webhooks are great in container shipping and logistics because they offer more timely data movements. Unlike older communication technologies like file transfer protocol (FTP) and electronic data interchange (EDI), APIs and webhooks have instantaneous qualities. When combined with Splice’s data translation capabilities and connectors, APIs and webhooks allow Splice to make many different systems act like one and maintain a library of over 150 connections. ‘One from many’ is the principal ambition of our data splicing abilities support by our API-first platform. 


While we have the ability to integrate with just about any legacy platform, we encourage our customers to deploy API and webhooks for the many reasons described above. In the long-term, API infrastructure offers the best return on investment as it is less expensive to implement and maintain. Another ROI-boosting characteristic is that APIs and webhooks share common infrastructure, providing flexibility in their deployment. While a September 2024 study by the Digital Container Shipping Association (DCSA) found that shippers are using APIs for only 6-9%, expect to see a rapid increase as more ocean carriers, terminals and logistics service providers lean into API and webhook advantages. 


Summary

Both APIs and webhooks are essential tools in the modern landscape of application integration. Choosing the right approach depends on the specific requirements of your use case. Splice uses these technologies to achieve varied objectives: to track export receiving dates; monitor container yard activities and intermodal asset geolocations; and build ecosystems. Whether you’re a freight forwarder with offices worldwide, a shipper looking to optimize your logistics and supply chain, or a 3PL wanting to connect your TMS, WMS and yard operations, understanding the strengths of APIs and webhooks will empower you to build smarter solutions.


Interested in learning more about how we use APIs and webhooks? Contact our team today or explore splice-it.com to see how we can optimize your export workflows.


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