A Closer Look at Microsoft Dynamics 365 vs Salesforce: CRM Comparison

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A Closer Look at Microsoft Dynamics 365 vs Salesforce: CRM Comparison

Both Salesforce and Microsoft Dynamics 365 dominate the CRM market, each with similar robust features that can propel business growth.

As a Microsoft partner, we can’t claim to provide an unbiased comparison between Dynamics and Salesforce. However, in this post we will give you an honest and straightforward evaluation to explain the frequent reasons why companies choose Dynamics. These factors may also be significant for your business.

Dynamics 365 and Salesforce: Background

Dynamics and Salesforce are consistently recognised as the leading CRM providers, lauded by prominent analysts Gartner and Forrester for their product offerings and strategy.

There are minimal differences between the respective positioning of each product in these reports. Also, as demonstrated by the Gartner-verified reviews below, there isn’t much to separate them based on customer ratings.

Gartner Comparison Table Between Dynamics 365 and Salesforce

As the creator of cloud-based CRM, Salesforce maintains its market dominance. According to recent reports, Salesforce commands a 23% share of the global CRM market, while Dynamics 365’s market share is estimated to be around 7-8%.

These figures highlight Salesforce’s early mover advantage as a pioneer in cloud CRM. They also reflect its decade-long head start before Microsoft launched a cloud version of Dynamics in 2008.

However, in recent years, Dynamics 365 has closed the gap.

This is partly due to Microsoft’s investment in R&D. In the 2023 fiscal year, Microsoft reported a colossal R&D expenditure of $27 bn compared to $5 bn by Salesforce in the 2023 financial year.

Through this investment, Microsoft has unleashed a wave of innovation, leading with cutting-edge AI advancements. The Microsoft Copilot digital assistant stands out among these. Now an integral part of Dynamics 365, Copilot delivers valuable time-saving features and intelligent assistance.

Copilot also integrates directly with Salesforce. Also, with the anticipated step up in Salesforce’s Einstein platform, AI could soon evolve into another CRM feature category where both providers offer comparable propositions.

Commitment to Partnership

Here’s where the narrative shifts. Dynamics 365 and Salesforce may share similar features and ratings, but their respective routes to market and ecosystems are fundamentally distinct.

Salesforce operates a tightly controlled, centralised approach to its products and services. In contrast, Dynamics is supported by Microsoft’s vast network of partners.

This decentralised approach fuels a wealth of options for customisation and guidance across various industry specialisations.

Microsoft’s commitment to its partner channel provides customers with a diverse selection of consultants, resellers, and integrators who offer localised support and specialised skills.

We believe the partnership culture fostered by Microsoft allows for greater customer choice through customisation, expertise and support tailored to each organisation’s needs. This contrasts with Salesforce’s more direct approach, which can limit personalised experiences.

Integrating Your CRM

Dynamics 365 is designed to simplify CRM adoption and maximise productivity efficiency with its seamless integration into the Microsoft ecosystem.

Built atop the Microsoft Power Platform, Dynamics natively integrates with productivity tools such as Power BI, Power Apps, and Power Automate. This empowers businesses of all sizes to harness data-driven insights, deploy custom low-code apps, and streamline workflows, all within a unified platform.

In addition, Dynamics 365’s seamless integration with everyday applications like Teams, Outlook, and SharePoint makes it a highly practical CRM choice. This enables users to collaborate and communicate effectively without the hassle of toggling between interfaces.

For organisations already invested in Microsoft technology, this is often an instrumental factor in choosing Dynamics 365.

There is no denying Salesforce’s adaptability and customisation capabilities. Through its AppExchange marketplace, Salesforce enables extensive adaptations, providing many options to integrate and tailor their CRM solutions.

Enterprise-grade security

When it comes to protecting customer data, Dynamics 365 and Salesforce both stand as the leading contenders.

With the might of Microsoft’s Azure security, Dynamics offers an expansive shield, giving an edge to organisations handling sensitive data.

The difference lies in integration. Dynamics 365’s intrinsic connectivity with Azure enables a unified and formidable security posture. In contrast, Salesforce has carved its own path of trust, emphasising multi-layered protection and real-time security policies.

Choosing between Dynamics 365 and Salesforce is about aligning with a security model that fits your business and compliance requirements.

Both prioritise data integrity without compromising functionality. However, Microsoft’s security reputation and substantial investment in enterprise-grade protection give Dynamics 365 an edge.

Navigating Dynamics 365 and Salesforce CRM Licensing

Dynamics 365 and Salesforce, while similar in their capabilities, offer contrasting licensing structures.

Salesforce is known for its straightforward entry-level licensing model, providing an accessible starting point for businesses implementing CRM.

For instance, its Sales Starter CRM plan starts from £20 per user/month, which can be easily upgraded when users require more functionality.

As the Starter edition doesn’t include workflow automation, forecast management, or access to the AppExchange, upgrading may be an early imperative.

At this point, it’s a steep hike to the Professional edition at £64 per user/month for these capabilities. Alternatively, the Enterprise plan at £132 for unlimited flows, approval processes and opportunity scoring.

To accurately determine the long-term cost, it’s crucial to evaluate how quickly a basic Salesforce subscription may need to scale. This will avoid any disruptions caused by limited functionality in case upgrading is unaffordable or switching to another CRM platform for a lower cost.

By comparison, Dynamics 365 offers fewer licensing plans across its modules, and these have a consistently higher starting price point. However, the basic plans come with more features and capacities than Salesforce starter editions, with smaller incremental costs between editions.

For example, D365 Sales Professional is priced at £53.40 per user/month. This includes Power Automate workflow automation, lead/opportunity management, quotes and integration across Microsoft 365 apps.

Stepping up to the Sales Enterprise edition at £78.10 per user/month adds Copilot capabilities, forecasting, territory management and unlimited capacities for processes and custom tables. At these comparative levels, Dynamics competes highly with the mid-range and upper licensing tiers of Salesforce.

Licence Billing

Dynamics 365 licences are typically billed by partners, offering flexibility in frequency and subscription terms. This includes the option to lock in pricing for up to 3 years while benefiting from monthly billing. This structure also allows for adaptability, allowing customers to reduce the total number of licences billed on a monthly basis if required.

This approach helps organisations to manage their cash flows efficiently by providing flexibility and only paying for the necessary licenses and functionality.

In contrast, Salesforce generally bills its customers directly on an annual basis. Businesses pay a lump sum for the year for the chosen Salesforce edition(s) and the required licenses.

Selecting a licensing model is a critical strategic decision that should be carefully considered before deploying either product. Undoubtedly, Salesforce will suit organisations seeking a low-cost entry into CRM with the flexibility to add features. Dynamics 365 licenses start at a higher price point but are packaged with more capabilities, potentially reducing the need to upgrade and resulting in a lower total cost of ownership.

Next Steps

In your journey towards digital transformation, choosing the right CRM system is crucial. With Dynamics 365, you can benefit from a seamless integration across Microsoft business apps and a partner-centric approach that adapts to your evolving needs.

Explore further with ServerSys to discover how Dynamics can enhance your operations and create exceptional customer experiences. Please get in touch with us today to start the conversation and discuss your requirements.

February 9, 2024

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Warren Butler

Warren Butler

Warren is the director of marketing at ServerSys. He brings over 20 years of experience covering business transformation, CRM and Microsoft Dynamics to help organisations grow by embracing technology.

If you have any questions, please get in touch with us at hello@serversys.com

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