As customers interact with brands earlier in the buying cycle, and their needs continuously change and expand, it is critical for companies to service the full customer journey by providing a unified customer experience across all of their digital touchpoints. Delivering that compelling digital experience is what is going to allow companies to differentiate themselves from their competitors and drive more customer awareness, engagement, and revenue in the long term.
To manage that full digital experience, there are a set of emerging software solutions known as digital experience platforms (DXPs). But the DXP, the centralized and integrated software framework for managing end-to-end digital experiences, and the extended software suite called a DX ecosystem, is not a one-size-fits-all solution for all business and industries.
There are three core DXP vendor strategies that are currently being offered, and knowing the advantages and disadvantages of each is the first step to making a good DXP decision for your particular organization, ensuring ROI for your investment.
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The All-in-One DXP Solution
The All-in-One software solution is the Holy Grail of software development, akin to the unified field theory of physics. From enterprise resource planning software to emerging digital experience platforms the quest for the perfect all-in-one platform continues, with mixed results, as expected. Whether a true, all-in-one, single vendor DXP that provides all needed capabilities in a single package actually exists is debatable. But let’s assume for a moment this solution is out there and in market, what would the benefits and drawbacks of such a system be?
The first obvious advantage is that a company would have only one vendor to buy from and work with for support. Anyone in a medium to large enterprise knows the majority of their days can be spent managing multiple dispersed partners and vendors. With only one vendor to deal with, a company saves on procurement time and resources; reduces communication time with multiple vendors; and there is only one company to hold accountable when the inevitable tech and support issues arise. Another important advantage to an all-in-one system is that there are potentially fewer integration issues than if you were trying to stitch together a variety of point solutions.
There are several potential downsides to having the Holy Grail all-in-one solution. First, as mentioned, it is debatable whether any vendor currently provides every solution a business needs; and if they do, whether or not they have good integration across their own different sets of products.
Second, getting locked-in to a single vendor can limit your future ability to update with emerging tech solutions as they come along and business needs change. Next, if other vendors pick up the same package as you do, how will you differentiate from your competition who offers the same solution with the exact same features? Finally, anytime you go with an all-in-one solution, you lose the potential to get best-of-breed software that specializes in a particular core strength. There is a big difference between the expertise and background needed to build a CRM system vs. a CMS platform vs. an e-Commerce solution. Some vendors have been developing best-in-class solutions in their own particular niche for some time.
“60% of companies prefer the option of a DX platform that integrates core, best-in-class components and integration capabilities” - Michael Gerard, CMO of e-Spirit.
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A DXP with Core Best-in-Class Components
According to Michael Gerard, CMO of e-Spirit, a DXP vendor, “60% of companies prefer the option of a DX platform that integrates core, best-in-class components and integration capabilities.” The advantages of a system like this is that a company can build its own unique DX ecosystem that is tailored to their unique business strategy and customer needs. In addition, you get a single vendor to be responsible for your main core DX platform, without having vendor lock-in across all DXP or DX ecosystem components. As the market evolves, this type of setup allows your company to remain flexible, allowing you to keep or swap out components as new ones are introduced to the market or as business requirements change to stay competitive and future-proof your digital experience ecosystem investment.
Some drawbacks of this type of solution is that if you are going through the effort to integrate those core components, you want to ensure they really are best-in-class. Make sure you do your research and assess the core components are best of the best.
Second, your interoperability with each core component is only as good as the last piece of technology you set-up. If the latest component isn’t fully interoperable with the other best-in-class solutions, the interoperability of the entire system can be put in jeopardy.
Lastly, this concept requires that groups like IT and marketing work with more than one vendor, potentially increasing procurement time, vendor support and time spent on communication, and multiple vendors to hold accountable.
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Build Your Own DXP as an Aggregate
The final option for a DXP development strategy is to just go ahead and build your own DXP and DX ecosystem as an aggregate of point solution vendors. A mix-and-match approach has some nice advantages, but some significant drawbacks as well.
The first advantage is it gives a company the ability to pick and choose which particular technology vendor and solution is right for your company and customers. A second advantage is this is a good way to get negotiating leverage over vendors in the procurement process, according to Gerard.
There are several issues that should be of concern when trying to implement this type of strategy. First the ability to integrate point solutions with DX platforms doesn’t always exist. Without that integration, you may not be able to build the type of complex solutions that are needed to manage the full customer digital experience. Point solution integration challenges can also inhibit the ability to update tech when the business strategy changes or customer needs evolve.
Another issue with this strategy is that there are more than 5,000 point solution vendors out there, and will all those companies really be viable in the long term? Surely some will succeed and some will fail, do you really want to spend months and large investments on a solution that may be gone in 2 years? Finally, very few point solution vendors can support an enterprise-class international business across multiple languages, business units, channels and touchpoint. For a company to employ this strategy, they really need to be digitally native to have the skills and processes internally to deploy this type of strategy.
The benefits of DXPs are numerous and like content management systems (CMS), they are quickly becoming mission-critical software to future-enable your company for changing business demands and customer needs.
A DXP can help to retain and upsell your customers with personalized content and messages, engage your prospects to build trust, and provide the ability to deliver personalized digital experiences in order to leverage your customers as brand advocates.
Ensure the DXP strategy you employ will be the right one for your business and your customers, with the right amount of flexibility, scalability and future-proof to show ROI and return for your time and effort.