The DXP Catalyst Update - Apr 17, 2025

INTRO
Welcome to This Week’s DXP Catalyst Update

In this edition of the DXP Catalyst Update, we’re focusing on how to advance digital experience initiatives when budgets are flat and financial scrutiny is high. Whether you’re making the case for consolidating tools, enabling smarter personalization, or unlocking operational efficiencies, customer experience (CX) investments still have a role to play, but only if they’re framed the right way.

Let’s dive in.

LEADERSHIP GUIDANCE
Making the Business Case for CX Platform Investments in a Flat Budget Year

Economic pressure doesn’t stop digital expectations.

While fiscal year timelines vary, some organizations will begin planning for their next cycle over the summer - at a time when many are still managing flat or reduced budgets for the remainder of 2025. At the same time, the pressure to improve digital CX has not let up. Customers expect seamless, personalized interactions across every channel. Internal teams are being pushed to deliver more with less.

Yet across industries, digital platforms are underperforming. Legacy systems are fragmented, data is siloed, and teams are spending too much time manually stitching together customer experiences at a moment when speed and efficiency are more critical than ever.

The opportunity? With the right framing, CX platform investments can still move forward, even in a flat budget year. But the case has to go beyond “digital transformation” and focus on tangible business outcomes, cost efficiency, and future readiness.

What’s at Stake: The Hidden Cost of Standing Still

When budgets tighten, mar-tech optimization efforts are often the first to be deferred. However, delaying these initiatives can come at a significant cost.

Companies with weak CX tend to see higher churn, lower engagement, and declining loyalty. Internally, operational inefficiencies stack up: campaign velocity slows, personalization falls flat, and manual work eats into team bandwidth. Meanwhile, the competition is modernizing.

Even modest gains in retention or operational efficiency can lead to outsized improvements in revenue and profitability, especially when applied across high-volume channels or core segments.

This isn’t about optional digital upgrades. It’s about whether your business has the foundation to compete in the present and future.

Reframing CX Investments as Efficiency Plays

Customer experience initiatives are often viewed primarily through the lens of improving customer interactions. However, the right investments also create meaningful operational advantages. Rather than positioning CX improvements as a future-state vision, they should be framed as a practical way to drive speed, reduce overhead, and unlock greater agility across teams.

• Unifying content platforms eliminates redundant tools and license fees

• Real-time customer data enables smarter decisioning - without adding headcount

Especially in flat budget years, these kinds of efficiencies matter. Strategic CX investments, whether it’s consolidating tools, improving workflows, or enabling personalization, aren’t just about customer-facing improvements. They can unlock real operational efficiency and revenue impact when thoughtfully implemented.

Show the Math: What the Business Really Cares About

CFOs and business leaders don’t buy platforms - they invest in outcomes. To get buy-in, show how the investment connects to metrics that matter:

• Consolidation of multiple tools and the resulting cost savings

• Decrease in time-to-campaign or cost-per-acquisition (CPA)

• If applicable, increase in retention or average order value (AOV)

Even modest ROI modeling can reframe the conversation. Rather than emphasizing platform features like personalization or orchestration, focus on the measurable impact like streamlining operations, increasing conversion rates, or reducing manual effort. Incremental improvements in these areas often translate into meaningful financial gains, especially when scaled across teams or high-volume channels.

At the same time, it’s important to account for the cost of doing nothing. Poor CX can lead to lost revenue, higher service costs, and internal inefficiencies that quietly compound over time, often at a greater cost than the investment needed to modernize.

Tailor the Story to Your Stakeholders

A one-size-fits-all pitch rarely works, especially in a flat budget environment. Each stakeholder has their own lens, and your case needs to flex accordingly. Consider:

• Finance: ROI, cost consolidation, reduced license bloat

• Marketing: Faster campaign launches, improved conversion, better attribution

• IT: Integration, reduced tech debt, security and governance

• Sales/Ops: Higher quality leads, more efficient handoffs, better visibility

Ultimately, you’re not just advocating for a technology upgrade; you’re addressing a cross-functional business challenge. Framing CX investments this way creates alignment across stakeholders and increases the likelihood of long-term support.

Use Cases That Resonate

Across industries, organizations are making targeted, phased CX platform investments that deliver measurable results because they focus on solving high-impact problems first rather than trying to do everything at once.

In higher education, many universities are modernizing their digital stacks to better support decentralized content publishing across departments. By moving to more flexible CMS platforms and layering in personalization, they’re improving engagement with prospective students while reducing reliance on central IT.

In the CPG sector, global brands are consolidating legacy systems and adopting composable architectures to streamline regional content operations. This shift is reducing campaign cycle times and enabling real-time personalization based on product availability, customer behavior, and regional preferences.

Among PE-backed and growth-stage services companies, CX platform investments are often tied to scaling customer engagement without ballooning headcount. A common pattern is pairing a CDP with journey orchestration tools to improve upsell and retention, while also rationalizing overlapping mar-tech tools inherited through rapid expansion.

These initiatives aren’t large-scale replatforming efforts. They’re deliberately scoped, outcome-driven projects designed to demonstrate near-term impact while laying the groundwork for longer-term transformation.

Making the Case with Strategic Framing

Even with a strong case, how you present it matters. Especially when everyone’s scrutinizing every line item, the tactics you use to frame and sequence the investment are key.

Here are a few that can help:

• Start small: Focus on a pilot project, a single use case, or a single department

• Phase your investment: Roll out capabilities in stages, with clear KPIs for each phase

• Offset costs: Decommission legacy tools or reallocate underused budget lines

• Explore vendor incentives: Many vendors offer incentives like onboarding credits or other discounts

And above all, tie the ask to measurable milestones. Easier said than done! If you can show quick results, it becomes much easier to justify the next wave of investment.

Final Thoughts

Flat budgets can feel restrictive, but they often lead to greater strategic focus. They compel teams to examine what’s delivering real value, what can be streamlined, and where meaningful impact can be achieved.

Customer experience investments, when thoughtfully prioritized, enable organizations to improve engagement, accelerate delivery, and operate with greater efficiency. Those that invest with a clear strategy, rather than reacting to short-term pressures, are more likely to build lasting advantage and emerge stronger over time.