Variables can reference other variables. The syntax is #{Variable.Name}. References resolve recursively at deployment time, so a chain of references collapses into a single final value before the step runs.
Three variables, one resolved value
Reduces the duplication in connection strings and URLs.
Db.Host = "prd-sql-#{Region}.internal"
Db.Name = "app_#{Environment}"
Db.Connection = "Server=#{Db.Host};Database=#{Db.Name};Trusted_Connection=yes"
Region (env=Production) = "eu-west"
Environment (env=Production) = "prd"
Resolved value of Db.Connection in Production (eu-west):
Server=prd-sql-eu-west.internal;Database=app_prd;Trusted_Connection=yesWhy this matters
Without composition, every connection string in every environment is its own variable, and changing the database server name requires editing N values. With composition, Db.Host is one variable scoped per environment, and the rest follows.
Token replacement in files
The same #{Variable.Name} syntax works inside config files. A package deployment step with substitute variables in files enabled walks the listed files and replaces tokens before the package is placed on the target. Useful for appsettings.json, web.config, custom INI files, and similar.