Exploring the Confluence of Composability, SaaS and AI

Exploring the Confluence of Composability, SaaS and AI

The Gist

  • Rapid growth and key trends in Digital Experience Platforms (DXP). The global DXP market, poised to grow from $12.2 billion in 2022 to $27.2 billion by 2028, sees an evolution with emerging trends like Digital Experience Composition (DXC), integration with Customer Data Platforms (CDPs) and the rise of Software-as-a-Service (SaaS) models.
  • Significance of composability, low-code and no-code solutions. Composable, modular solutions are on the rise, with Front-End-as-a-Service (FEaaS) playing a critical role.
  • Influence of AI and CDP integrations on DXPs. The integration of CDPs with DXPs is changing how customer data is viewed and managed across platforms, and AI is gradually integrating into DXPs.

In the swiftly evolving landscape of Digital Experience Platforms (DXP), marketers and customer experience professionals must keep pace with emerging trends and shifts in technology.

The DXP market is big business. The Global Digital Experience Platform (DXP) market is expected to experience significant growth between 2023 and 2030, according to a forecast. As of 2022, the global Digital Experience Platform market was estimated at $12.2 billion, and it’s anticipated to reach $27.2 billion in 2028.

According to the CMSWire DXP Market Guide, a DXP is defined as an integrated set of core technologies whose goal is to support the creation, management, delivery and optimization of customized digital customer experiences (DCXs).

Emerging DXP Trends: Composition, Composability and CDP Integrations

From the emerging trends of Digital Experience Composition (DXC) and low-code and no-code solutions to the significance of composability and the rapid shift toward SaaS models in the DXP market, buyers need to navigate these transitions with care and thorough consideration.

The integration of Customer Data Platforms (CDPs) with DXPs is reshaping how customer data is viewed and managed across various platforms. Meanwhile, a “CDP light” approach is emerging as a viable strategy for users grappling with the implementation of comprehensive CDPs.

In a post-pandemic world, the lessons learnt have led to more resilient and reliable DXP solutions. And as AI begins to stake its claim in content management and DXPs, we discuss the importance of understanding and addressing the legal and ethical implications that come with it.

Composable, modular solutions are on the rise, and the role of Front-end as a Service (FEaaS) is becoming critical in this sphere. From the trend toward low-code and no-code solutions to the increased focus on Digital Asset Management (DAM) and Content Marketing Platforms (CMP), it’s clear the DXP landscape is undergoing a profound transformation.

Let’s dive more in-depth into these DXP market trends and their implications for marketers and digital customer experience professionals.

Related Article: Digital Experience Platforms (DXPs): What to Know

Digital Experience Composition (DXC): An Emerging Market Trend

Irina Guseva, senior research director at Gartner and author of the “Magic Quadrant for Digital Experience Platforms,” points to the growing interest in Digital Experience Composition, particularly among vendors on the periphery of the DXP market, as well as headless CMS vendors.

According to the Gartner “Magic Quadrant for Digital Experience Platforms” published earlier this year, “Digitally mature prospects are looking to compose their own DXPs from modular, independent capabilities, and DXC is positioned as the point of composition for digital experiences.” The term essentially refers to the process of creating a digital experience using a variety of components from different technologies. Guseva emphasizes that this approach requires careful management of APIs, integration and orchestration.

“Digital Experience Composition, it’s really interesting because it’s not only no-code, but it’s also all that orchestration that goes in between the different technologies,” Guseva said in an interview with CMSWire.

According to Guseva, the DXC market is not fully developed or tested. As such, she advises buyers to approach it cautiously, considering factors like their organizational and digital maturity and the skillsets available to them. She also highlights the importance of governance in the customer experience and content realms.

“Be very, very careful as to how you go about this because it is a nascent, just the very new kid on the block kind of sub segments of the market,” Guseva said. “It’s not fully developed, it’s not fully tested. The footprints may vary. There’s not that many vendors who can be defined as Digital Experience Composition vendors.”

Related Article: Is Digital Experience Composition the Answer to Martech Madness?

How Front-End as a Service (FEaaS) Is Influencing DXPs

When speaking about hosting when it comes to DXPs, Gartner notes in its magic quadrant that “prior disruption in the DXP market by headless architectures has led to increased support of JavaScript frameworks natively within the WYSIWYG editor interface.” Many DXP vendors now offer Front-end-as-a-Service (FEaaS) because of the decoupled trend and offer support for the “packaged hosting and management of those JavaScript front ends in the same cloud service to serve clients looking to adopt this delivery method.” 

FEaaS is playing a critical role in the development of digital experience platforms, according to Gopinath Manimayan, lead architect of digital experience at Moonraft Innovation Labs.

“FEaaS provides pre-built UI components and frameworks that accelerate development and deployment of digital experiences, benefiting both vendors and customers by offering greater flexibility and customization options,” Manimayan said.

The Journey Toward Composability and SaaS in the DXP Landscape

The journey toward composability is still in its early stages, and there is a strong demand from buyers for true Software-as-a-Service (SaaS) solutions. 

For now, buyers are on a journey to decompose the monolithic applications and make them more manageable, agile and malleable, according to Guseva. But further, she noted, they’re also on a journey of modernizing the entire cloud infrastructure.

“That’s why the majority of vendors in this market have gone or still are going through this kind of ‘Saasification’ paradigm of their platforms,” Guseva said. “One, to get rid of their technical debts, because most of them are coming from the 20-plus-year-old, highly-commoditized and highly-mature CMS background. But two, to really respond to the demands of the buyer; it has to be a true SaaS.”

Guseva notes a discrepancy between buyer expectations and vendor pricing models. The challenge with composability and SaaS, she added, is pricing is not truly consumption-based, and that disturbs pricing negotiations in the DXP space. “Because the expectations of the buyer do not align with pricing and packaging. It’s just very expensive,” she added.

Dan Barak, CEO and co-founder of Stackbit, said monolithic DXP suites are finding the transition to a composable stack challenging due to the need to untangle many dependencies to become compatible with other solution vendors.

Related Article: A Decade of Dramatic Change in Digital Customer Experience

The Importance of Low-Code and No-Code Solutions in DXPs

Guseva identifies low-code and no-code solutions as critical tools for managing the complexity of the DXP market. These tools can simplify the process of creating and integrating different components, making it easier for business users to create their desired experiences.

Why so essential? DXPs are not meant to be out-of-the-box tools because of its level of complexity. Remember, it was Gartner that found that 85% of effort and cost in a DXP program will be spent on integrations with internal and external systems, including the DXP’s own, built-in capabilities.

“Low-code, and no-code comes in really handy, especially for business users,” she said, citing they can use them for experience composition such as drag and drop, testing, optimizing and ultimately the goal of personalized experiences.

“But it is also helpful on the integration side of things, and that’s again where composability comes in,” Guseva said. “Because one of the main pillars of composability is having that application integration catalog and marketplace … for all these other systems in the martech architecture stack out there in the world. So low-code and no-code is essential, especially if you look at it from the point of view of fusion teams. So before there was IT on one side of the table, and then there was marketing. Now that was it from like total experience perspective, and a multi-experience and customer experience and employee experience and user experience all coming together and looking at it from a central lens.”

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