Why are Companies Choosing Dynamics 365 Over Salesforce?
Are you wondering why companies are choosing Microsoft Dynamics 365 over Salesforce? Our Marketing Consultant, Cassandra Smith sat down with our Vice President of Sales and Marketing, Rob Triggs, to get a real life insight into what’s really happening in the market place.
Cassandra: Why are companies choosing Dynamics 365 over Salesforce?
Rob: Primarily the licensing model for Salesforce is too expensive. Sometimes what happens is a customer will buy Salesforce and they’ll start off at $65 a user, which gives them basic access. They’ll say, “Well this is going really well, let’s add the ability to see our customer service.” So, all the employees need to add this new functionality. Now the price goes up to $90. Each time the company adds additional functionality to their system there is an increase. This trend continues and can end up with licenses costing $250 per user.
Salesforce is very “a-la-carte”, whereas the Dynamics 365 licenses is “all you can eat.”
Cassandra: What can you tell us about the “all you can eat” that you get with Dynamics 365?
Rob: Microsoft recently restructured their licensing model based on user profiles. So if you’re a sales person, you can get a license that’s just for sales. If you’re a Customer Service person, you can get a license for that too. They also have a team license, which is great if someone just needs to view things in CRM. That’s under $20 per user to see what you need to see.
The last one is a full use license. The full use license is really the “all you can eat” license, and it’s a fraction of the cost of the Salesforce license.
“The full use license is really the “all you can eat” license, and it’s a fraction of the cost of the Salesforce license.”
Cassandra: When we work with clients how do we consult with them so that they are not overbuying licenses?
Rob: When we start a project we always try to figure out, to have a positive impact on the business, what license should each person have? So rather than just overbuying licenses, we actually suggest what the customer needs.
In the future if they need to increase the license, which rarely happens, they already know what the cost will be. There are no surprises.
Cassandra: What about the Salesforce licensing is encouraging companies to explore other CRM systems?
Rob: One of the reasons why Salesforce customers are leaving is: they may be 2-3 years into a contract, their costs have doubled or even tripled, and there doesn’t seem to be any stop in sight. More and more customers are feeling very frustrated that the cost keeps spiraling out of control to get more value out of the platform.
At the same time, the Microsoft solution has become so good that even Gartner has rated them the top choice now for enterprise class CRM systems.
Cassandra: What are the main differences between the Salesforce and Dynamics 365 license structures?
Rob: The problem with Salesforce is that you commit to a term. Right now they are looking for 5 year commitments. I’ve even heard instances where contracts are longer than that. I find that odd for a business to ask for that kind of long term commitment.
Microsoft asks for a one-year commitment and you can increase and decrease the number of users, you just can’t cancel the contract for 1 year.
So, the difference is Salesforce has a 5-year commitment, Microsoft has a 1-year commitment. With Salesforce you can increase easily, but it is difficult to decrease. On the Microsoft side you can increase and decrease at your will.
Cassandra: Should existing systems within the company influence the choice of CRM?
Rob: Dynamics 365 has been engineered to be an add-on to Outlook email client. So, when you’re receiving emails from your customers, and you have contacts, it automatically connects to Dynamics 365.
Other programs like Word, PowerPoint and Excel are also integrated into Dynamics. For example, you can go into a customer entry and turn it into a proposal right from CRM, and it will automatically populate a word template for you. Your salesperson can generate a proposal in minutes, and these are things you just can’t do in Salesforce.
Cassandra: What if a company already has Office 365?
Rob: Any company that already has Office 365 only has half the solution. All they need to do is add Dynamics and they’re set!
We advise our prospects who are leaning more towards Salesforce to make sure you thoroughly understand the contract.
Cassandra: What would your advice be to a business that’s considering Dynamics 365 and Salesforce?
Rob: We advise our prospects who are leaning more towards Salesforce to make sure you thoroughly understand the contract. Not just what you’re paying in year one, but what you’re contractually paying in year two, year three and so forth. They usually have these balloon payments and sometimes it’s hard to see that in the terms.
The second thing to consider is commitment to a contract. Salesforce is trying to get people to commit to 5 years. This should alarm people. Anytime anyone wants you to contractually commit to something for that length of time makes you wonder, “why are they doing that?”, and “what are they worried about?”
We believe that Microsoft is continuing to get better and stronger, be the more popular choice. What Salesforce is doing is looking for commitments because they are worried about Dynamics 365.
Cassandra: In your opinion what do you think will happen to Salesforce in the next 5-10 years?
Rob: As a company, they don’t make a profit. They make a lot of revenue, but they are not profitable. They spend a lot of money on marketing and sales, but we have not seen much innovation. There are different apps that you can add on, but not a lot of innovation.
Dynamics has been the opposite. Microsoft has been pouring tons of R&D dollars into Dynamics 365. They have just moved Dynamics into the main stream at Microsoft. This means that it has the attention of all the account managers at Microsoft.
We expect to see Microsoft leapfrog Salesforce in the next 18-24 months. The Dynamics value proposition is much stronger now than Salesforce. The costs are better. The long term roadmap is better. We believe that Microsoft will continue to pull away from Salesforce in the near future.
Cassandra: What do you think the future looks like for Dynamics 365?
Rob: The same thing that happened with desktop publishing and email, the same thing will happen with CRM. Most companies will use Dynamics 365 because it rounds out their Microsoft investment.
Cassandra: On average how much do you think we save our clients by moving them away from Salesforce to Dynamics 365?
Rob: For clients that we’ve migrated, we have saved them 50% of the cost. By moving to Dynamics from Salesforce they’ve received a positive ROI in the first 6 months, just from the cost savings on the licenses.