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What Is a Digital Experience Platform and Why Should You Care?

Digital Experience Platform: A core set of software technologies that orchestrates the creation, delivery and optimization of personalized, content-rich digital experiences anytime, anywhere to delight customers, compel them to action, and enable a company to outperform its competition.

For centuries organizations have attempted to differentiate their companies by creating amazing products, establishing creative offers, using effective distribution channels, and/or going to market with competitively priced products. Many companies have succeeded in one or more of these strategies to drive business growth. However, over time competitive forces commoditize these opportunities for differentiation, leaving organizations searching for new ways to out maneuver their competition.

At the same time, the power of buyers has greatly increased with the advent of the internet, providing direct access to product insight, competitive information and buyer reviews. (e.g., analyst research continues to indicate that more than 60 to 70 percent of the buying decision is made before a buyer even speaks with a salesperson, if they even speak with a salesperson at all during the buying process). The best and most innovative companies have discovered a significant opportunity in this new environment to differentiate their products and services: customer experience.

"By the year 2020 it’s expected that customer experience will overtake price and product as the key brand differentiator."

-Walker

However, in order for companies to tap into the power of experience as a differentiator, they will need to meet very demanding customer expectations. For example, providing customers with instant access to information in a personalized manner, and providing this information to any channel in a synchronized manner. Jake Sorofman of Gartner correctly indicates in a recent report that customer experience is the new competitive battlefield.

Wikipedia provides a simple, yet effective description of this term:

“Customer experience (CX) is the product of an interaction between an organization and a customer over the duration of their relationship... All of the events experienced by customers before and after a purchase are part of the customer experience.”

Delivering this experience involves participation by all functions organization-wide, such as marketing, sales, customer success, engineering and operations.

Delivering an exceptional customer experience starts with the critical first step of interacting with and acquiring a new customer and/or upselling an existing customer. This step is ultimately responsible for driving new revenue for companies. The digital interaction of companies with their buyers, partners and influencers prior to and during the buying process, specifically including the roles of marketing and sales along with associated support by IT, is defined as the Digital Experience. This experience includes the interaction of companies with buyers, partners and influencers across any and all touchpoints to generate awareness, demand and revenue.

What is a Digital Experience Platform?

Delivering this digital experience requires the complex interaction of people, processes and technologies across an organization, working in complete harmony to capture the attention of buyers, build trust and compel them to action. The explosive growth of innovative marketing technologies has put this vision in the grasp of organizations both large and small: There has been an over 95 percent compound annual growth rate (CAGR) in marketing technologies over the past 6 years with over 5,000+ vendors today. (Figure 1)Growth of Marketing Technologies over time

This growth of innovative technologies coupled with the increasing digital experience demands of buyers has created both challenges and opportunities for marketing and IT teams who must:

  • Harness the force of innovation to delight customers and differentiate a company’s products and services

  • Deliver an individualized experience for each and every buyer in real-time

  • Deliver this experience across any channel in a synchronized manner

Even more challenging, is accomplishing all of this in a scalable manner for enterprises to support thousands or millions of buyers and touch points across multiple countries, websites, languages and business units, all while maintaining the flexibility to adapt to changing customer needs and advances in technology. This is the ultimate mission and objective of a digital experience platform (DXP).

More specifically, e-Spirit defines a Digital Experience Platform as follows:

  • Digital Experience Platform: A core set of software technologies that orchestrates the creation, delivery and optimization of personalized, content-rich digital experiences anytime, anywhere to delight customers, compel them to action, and enable a company to outperform its competition.

Other industry definitions of a DXP include:

  • “Software to manage, deliver, and optimize digital experiences consistently across every phase of the customer life cycle.” - Forrester

  • “A composite, rationalized and integrated set of technologies and services on which modern websites, portals, mobile apps, and IoT apps can be built.” - Gartner

Core Components of a Digital Experience Platform

Key components of a digital experience platformSince a digital experience includes the interaction of companies with buyers, partners and influencers across any and all touchpoints, this experience would not be possible without the creation and delivery of personalized content to any and all channels. Therefore, core components of a DX platform include content management, personalization, and the ability to deliver this content to any channel in a synchronous manner at scale.

In addition to these core components, there are a vast array of technologies needed to support a comprehensive digital experience which a DX platform must be capable of operating with. These technologies, coupled with the above-mentioned core components, make up a company’s “digital experience ecosystem.” Examples of just a few areas in this ecosystem include:

Core components:

Additional components:

  • e-Commerce

  • Digital asset management

  • Translation

  • Customer relationship management

  • Marketing automation

  • Social media

  • Analytics

  • Data management platforms

  • Video management

The “glue” holding all of these components together and enabling them to interact in a real-time manner is enabled by a layer of interoperability. Key success factors in a DXP that enable this interoperability include:

  • Extensive, stable and comprehensive APIs: APIs provide the foundation to "play nice with others," be it the latest and greatest marketing software applications or legacy IT solutions.

  • Business level enablement: API level interoperability alone is not enough: A DXP needs to enable business users to interact with and benefit from third-party tools through seamless integration. That is, interoperability from a business user perspective with minimal to no IT involvement for example.

  • Microservices-based architecture: This architecture must support scaling and extension when needed, forming the building blocks of an agile digital marketing technology ecosystem. Read more about microservices-based architecture here.

A Digital Experience Ecosystem and the Role of a DXP

There are three main vendor strategies for building a DX ecosystem, including advantages and disadvantages for each:

Vendor Strategy Advantages Disadvantages
All-in-One, single vendor DX platform that provides every software capability
(questionable as to whether this even exists today)
  • Only one vendor to buy from and work with (i.e., save procurement time, reduce communication channels, only one vendor to hold responsible for problems)
  • Fewer integration issues (theoretically)
  • No vendor provides every solution today
  • Vendor lock-in could limit future technology changes
  • You have the same DX stack as other companies, hindering the ability to differentiate
  • All-in-one vendors rarely integrate across their own technology components, let alone other vendor technologies
  • Potential loss of specialization since one vendor can rarely provide the best software in every area (e.g., e-commerce software versus content management)
DX Platform with core, best-in-class components and integration capabilities
(60% of companies prefer this option)
  • One vendor responsible for the main “engine room” of your digital experience ecosystem without having vendor lock-in across all DX ecosystem components
  • Maintain flexibility to keep the applications you like today, and be future ready to enable integration with other applications that may arise in the future
  • Confirmation required that:
    • Core components are truly best-in-class
    • Interoperability is based on the last technology (e.g., REST API and microservices architecture)
  • IT and marketing will need to work with more than one vendor
Build Your Own DX ecosystem (an aggregate of point solutions vendors)
  • Ability to pick and choose which individual technology vendor is best for your organization
  • Greater leverage over vendors in the procurement process
  • Integrations of point solution vendors with other DX ecosystem solutions rarely exist to deliver complex solutions.
  • The challenges of Integration and upgrades may stifle improvements in technology or the ability to meet new customer needs
  • Long-term viability is questionable for many of the 5,000+ point solution vendors
  • Very few of these point solution vendors can support an enterprise-class, scalable business across multiple countries, languages, business units and touchpoints/channels.
  • Only digital native organizations have the capabilities to successfully deploy this strategy.

What is the Reward for Deploying a Digital Experience Platform?

As presented earlier, delivering a compelling digital experience offers companies the opportunity to differentiate from their competition and drive more engagement and revenue. Consideration of ROI for technology purchases to enable these digital experiences is no doubt still important, however, it is not a matter of ‘if’ you need to create these compelling digital experiences for your customers, but how soon you can deliver them. What’s at risk here? Survival. For example, the risk of losing your customers:

Salesforce.com researched customer behavior on websites recently and found that 52 percent of consumers indicated that they are likely to switch brands if a company doesn’t personalize communications to them.

Some benefits of deploying a DX platform to deliver digital experiences are as follows:

DX Platform Benefits Examples
Retain and upsell customers
  • Identify behaviors that reveal opportunities to:
    • Upsell customers
    • Prevent customers from defecting
  • Reward high value customers (e.g., rewards programs, special offers)
  • Engage customers with valuable content that may or may not be related to your own products (content marketing)
Help customers “shop” and not just “buy”
  • Educate buyers:
    • Provide do-it-yourself or self-help videos to educate buyers
    • Insert content alongside of online product catalogs
  • Provide channels and partners content that they can use to engage their audience (or provide this content directly to customers)
  • Provide community engagement opportunities
    • Product reviews
    • On-line communities
Compel customers to make their first purchase or increase average order value (AOV)
  • Deliver personalized content that will be most appealing to buyers in the moment
Increase brand value
  • Deliver engaging and personalized digital experiences that will increase the potential for your audience to act as brand advocates, both online and off-line
Improve internal productivity and reduce time-to-market to meet/exceed customer expectations
  • Efficient management of multilingual sites
  • Faster digital experience creation and delivery for marketers
  • Brand- and country-specific experiences can be maintained centrally while market-specific experiences are managed at the local sites
Reduce technology costs
  • DX ecosystem applications will interoperate more effectively and reduce integration costs
  • It will be easier and quicker to add new applications to an existing DX ecosystem
  • Deploying a SaaS-based DXP lowers fixed and variable technology costs and increases the innovation made available to business users (e.g., marketers)

The digital experience movement will no doubt continue to evolve with the changing needs of buyers, and companies will need to get more efficient and effective at meeting and exceeding those needs. The most successful organizations will:

  • Rapidly identify the explicit and latent needs of their buyers

  • Develop the culture and processes to harness the innovation and passion within their own employees and external teams

  • Tap into the power of new and innovative technologies


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