API product tiering is a strategic approach to offering varied levels of API access, features, and usage limits based on customer subscription plans, which facilitates monetization and efficient resource management. Kong Konnect, a cloud-native API lifecycle management platform, supports this model by enabling organizations to define API products, set authentication protocols, and manage consumer access through consumer groups. By implementing different tiers, such as free, basic, and premium, companies can tailor API access and rate limits to different user needs, as demonstrated by a fictional financial services company offering market data, account information, and payment processing APIs. This approach not only allows for the efficient scaling of services but also enhances user experience and unlocks new revenue streams across various industries.