The CRM market is booming
Every CRM market study agrees: the market for CRM has increased dramatically over the past several years. It wasn’t long ago that Gartner predicted a CRM market worth $36.5 billion by 2017.
Just last year, a 2017 study by Grand View Research upped the ante by predicting the CRM market will be worth $81.9 billion by 2025.
That’s a bold claim, and not everyone is as bullish. But even if the reality falls short of the GVR prediction, there’s no denying how lucrative the CRM market is right now. CRM market growth has been steady year-in and year-out, and we don’t seem to have found the ceiling just yet.
And frankly, business should be booming in the CRM world. Customer relationship management (CRM) systems can provide tremendous value to your business when well-implemented, and the rise of cloud-based and mobile systems over the past several years has made CRM more flexible and more affordable, especially for small and mid-sized companies that couldn’t afford the enterprise-level solutions of a decade ago.
As costs have come down, demand has gone up. And as demand has gone up, so too has supply. There are many, many CRM solutions on the market these days. Some of them have been around for years, and are household (ok, office…hold) names. Others are up-and-comers hoping for a shot at the title.
Finding the best CRM for your business
So with all these options before you, the question is this: Which CRM system is best for your business in 2018 and beyond?
CRM is certainly a lot more affordable than it was ten years ago, but it’s still a sizeable investment. You need to make sure you find a system that will generate maximum ROI for your business.
For most businesses, there are only two real choices: Salesforce, and Microsoft Dynamics 365 for Sales.
According to the 2017 Gartner Magic Quadrant for Sales Force Automation, Salesforce and Dynamics 365 are far and away the industry leaders. Both systems finished first and second in both completeness of vision and ability to execute.
Of the two, Salesforce has a much higher market share and far better name recognition. Even if you haven’t heard of CRM, you’ve heard of Salesforce. That’s because, as pretty much every study agrees, Salesforce has taken over more than 25% of the CRM market.
But for most businesses, the best bet for your business in 2018 and beyond is Microsoft Dynamics 365 for Sales.
Why you should bet on Dynamics 365 vs. Salesforce
Both Salesforce and Dynamics 365 offer enterprise-level functionality. But Salesforce pairs that with enterprise-level pricing. In fact, Salesforce isn’t just the most popular CRM on the market—it’s also the most expensive! As of June 2018, Salesforce Enterprise Edition ($150/user/month) costs over 50% more than Dynamics 365 for Sales ($95/user/month).
And that’s without factoring in the money you can save by using team member licenses ($8/user/month) in Dynamics 365!
Of course, you would get a lot of value from your Salesforce Enterprise Edition subscription. Salesforce CRM is a powerful product, especially for enterprise-level organizations, and anyone who says otherwise is fooling themselves.
But as Gartner reports, “Salesforce clients regularly identify issues with deriving value from their Salesforce implementations. Some clients object to the price paid, relative to the business results delivered by the system, and some object to the amount of customization needed to automate complex sales processes.”
Dynamics 365 offers the same benefits at a fraction of the cost, with far more flexible licensing and contracts.
Salesforce, meanwhile, has developed a reputation for being far less flexible. According to Gartner, “Gartner frequently speaks to existing and prospective Salesforce clients who are unhappy with Salesforce’s aggressive sales practices and licensing inﬂexibility, or who are dissatisﬁed with its contract negotiation techniques.”
Salesforce does offer more budget-friendly options. Salesforce Lightning Professional Edition is more competitively priced, but it is a stripped-down version of the software that does not compare to Dynamics 365 in terms of functionality. Again, Gartner tells us their clients were hesitant to opt in to Lightning editions due in part to “functionality gaps.”
Microsoft Dynamics 365 offers 3 license types: sales and customer service, sales, and team member. With Dynamics 365, you can get the exact licenses you need without breaking your budget.
Both Salesforce and Dynamics 365 are integration compatible with a huge number of business applications. This should surprise no one. Salesforce has been the industry leader in CRM for an eternity in technology years, and Microsoft has been the industry leader in general office software suites for even longer.
Where Dynamics 365 really stands out is (unsurprisingly) its compatibility with other Microsoft products. As of 2016, there were 1.2 billion Microsoft Office users. Without question, Microsoft Office is the gold standard for general office productivity.
Dynamics 365 boasts seamless, out-of-the-box integration with Office, Outlook, Exchange, SharePoint, and an ever-expanding suite of Microsoft applications including Azure Machine Learning, Azure Data Factory, Azure Data Lake, and Power BI.
Microsoft doesn’t just offer integration compatibility; it offers an integrated product line.
And because Microsoft’s Office suite is so ubiquitous, the result is high-value, low-effort integration with the tools your team already knows and uses. Gartner notes that its Dynamics 365 clients “have reported positively on this integrated product offering,” which isn’t surprising in the least.
Salesforce is integration compatible with most Microsoft offerings, but requires third-party add-ons to do so.
First, the straight-forward comparison: Dynamics 365 is available on-premises or on the cloud. Salesforce is only available on the cloud.
For many businesses, this isn’t a big deal. But for businesses with legal or operational constraints that require full, on-site control over CRM data, on-premises is the only choice.
On-premises CRM can also be a good choice for enterprise-level operations with the infrastructure, personnel, and up-front spending power to run internal servers.
If you are considering on-premises CRM, Dynamics 365 is the clear winner.
But flexibility is also about customization, and that is where the waters get a little murkier.
Both Microsoft and Salesforce offer third-party app stores (AppSource and AppExchange, respectively), and both offer app-building tools (PowerApps and Salesforce Platform—formerly App Cloud). In both cases, Salesforce was first on the scene. That means more developers have been working longer to create Salesforce add-ons than Dynamics add-ons, which gives Salesforce a clear numbers advantage.
But Microsoft makes up for that advantage in a couple key ways.
First, Dynamics 365 is easier to customize. As Gartner notes, “Microsoft’s strength lies in its ability to create custom sales processes. Microsoft’s reference customers gave it very high scores for the ability to customize its application with custom ﬁelds, custom objects, workﬂows and a customized user interface, which includes the ability to customize the user interface for desktop users.”
Second, Salesforce can requires heavy customization to generate value.
Although Gartner found “customers gave Salesforce high scores for the ability to create and maintain opportunity sales processes,” a major hurdle to generating value with Salesforce was “the amount of customization needed to automate complex sales processes.”
For large operations with fairly simple sales processes, this won’t matter much. But for smaller or more complex operations, this can be a huge barrier to your ROI.
Perhaps the most important reason to bet on Dynamics 365 vs. Salesforce is Microsoft’s long-term vision for their products.
Salesforce is an excellent piece of software, but Microsoft offers a powerfully integrated suite of software solutions.
And that suite is constantly growing, both internally and through Microsoft’s high-profile acquisitions of Skype (2011), LinkedIn (2016), and GitHub (2018—just two days before this article was published). Those three acquisitions alone represent a $44.1 billion dollar investment.
Microsoft is all-in on creating a suite of business tools far greater than the sum of its parts.
It’s worth noting that not all of these tools are fully-formed as of this writing. In particular, Gartner gave low marks to Dynamics last year for its forecasting and advanced analytics capabilities. Dynamics also lags behind Salesforce in terms of artificial intelligence capabilities.
But Microsoft has demonstrated a consistent willingness to invest in improving and expanding Dynamics 365 itself. Gartner also gave low marks to Microsoft’s reporting and dashboard capabilities in 2017, but Power BI has significantly improved both less than a year later. And it wasn’t long ago when Gartner rightfully listed Microsoft’s clunky CRM UI as a major weakness of the product. Now, the Dynamics 365 interface is one of the sleekest on the market.
Deciding between Dynamics 365 vs. Salesforce
Betting against Microsoft’s vision for Dynamics 365 seems silly, but that doesn’t mean Dynamics 365 is right for your business. Salesforce does boast several legitimate advantages over Dynamics 365, and for organizations that can absorb the extra costs, those advantages can be absolutely worth it.
But for most small and medium-sized businesses, we’ve found that Dynamics 365 offers a much higher return on investment, and we are more and more bullish on the future of Dynamics 365 for Sales with every announcement and update.
Sell better, faster, and smarter with Dynamics 365 CRM
Microsoft Dynamics 365 for Sales CRM offers your business the tools it needs to improve process and profitability.
What can your business do with more powerful marketing, sales, service, and support?
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