Know the Difference Between Lead and Contact; CRM by Microsoft Dynamics

2020-06-06T09:25:10-06:00 By |

CRM leads vs contacts? There is a piece of software for anything you could imagine. And if what you are looking for is not already out there, you can build one. You may find yourself suffering from decision fatigue by just thinking about the plethora of applications, additions, and features you can choose.

We understand this.

As the phrase ‘CRM’ may sound like another acronym floating around in the six inches between your ears. But customer relationship management software is how you facilitate cohesion within your business, streamlining the customer lifecycle and creating interagency connections.

Let us explore the difference between a lead and a contact in a CRM and how you can harness the power of technology to create a personalized experience for hundreds, thousands, even millions of customers that much easier.

But first let’s clarify what contact and lead terms are.

What is a Contact

According to Microsoft, users “use contacts to keep track of the people you do business with.” So basically, a contact is a customer you already have qualified and are doing business with. Being qualified and doing business with them is what is key here, if you have not yet qualified them they do not belong in your system as a contact.

What is a Lead

Again, as Microsoft says, people “use leads to keep track of business prospects that you haven’t yet qualified through your sales process. You might get leads from different sources, such as advertising, networking, or email campaigns.”

A lead is someone you meet at a trade show, a person submitting a form on your website, or any other person that has the potential to become a customer but who has not been qualified yet.

Building Your CRM with Microsoft Dynamics 365

Microsoft Dynamics 365 is a group of business applications that help you run every aspect of your business. Dynamics 365 enables your company to build a customer relationship solution that can meet the unique needs of your business. This AI-driven, predictive platform consists of five main applications and a comprehensive list of additional tools that you can utilize to unite your company and connect with your customers.

The five main applications within Dynamics 365 include Dynamics 365 for Sales, Dynamics 365 for Marketing, Dynamics 365 for Customer Service, Dynamics 365 for Field Service, and Dynamics 365 for Project Service Automation. Each application can integrate with the others as well as other Microsoft products and platforms, giving you a 365-degree view of your customer lifecycle.

First-class product features such as the Relationship Insights Tool and Dashboards allow you to track and record every user interaction with a customer, which is essential in closing leads. But impossible to use if you do not know the difference between a lead and a contact.

Your CRM and Its Many Moving Parts

It is essential to understand the moving pieces within your CRM, especially the difference between a lead and a contact. The difference between a lead and contact is a defining factor in obtaining accurate data; it can be the difference between making a profit or a loss.

CRM leads vs contacts

According to Microsoft, a contact is someone you currently do business with or have done business with in the past. The qualifying factor for a contact is doing a business transaction with them. If you have not, then they are not a contact.

If they are not a contact, they are most likely a lead. A lead is a business prospect that you have not yet qualified through your sales process. You can gather leads from various sources, such as advertising, networking, email campaigns, or social media. A lead has the potential to be a customer but has not qualified yet.

How do leads become contacts?

When you are ready to qualify a lead as a contact, the lead record closes while three new records open. The three records consist of a contact, an account, and an opportunity. The contact is the individual and their contact information. The account is the company where the individual works, and the opportunity is the information about the specific transaction.

Why is it important to know the difference between lead and contact in CRM?

It is essential to know the difference between a lead and a contact because they are in entirely different sales process steps and require different amounts of attention. A lead needs nourishment. If they get lost in the sales process due to inaccurate labeling or miscommunication, you can lose a sale now and future purchases, which means revenue lost.

How to Leverage Leads and Contacts with Dynamics CRM

Now that we have discussed the difference between a lead and a contact, and why it is crucial to know the difference, let us revisit the features of Dynamics 365.

When you label your data correctly and understand its proper organization, you can leverage useful tools that nurture leads and existing relationships. The interactive dashboards in the various Dynamics 365 applications give you a visual representation of your sales pipeline. Users can personalize the customer journey based on real-time information and user engagement, making you more likely to deliver the right message at the right time to the right person in the best location.

So, What Now?

Now, you are ready. You know the difference between a lead and a contact and how to apply it in your CRM, whether it is Microsoft Dynamics 365 or not. You can use this information for your customer relationship management platform, or you can apply it to your in-person interactions.

If you feel unsure about how to apply this information within your organization, a Microsoft Partner, like The Bauen Group, is ready to jump in and help.

About the Author:

The Bauen Group is a Houston web development firm focusing on business software, customized web and mobile development services, and consulting solutions for small businesses. Our team of experienced and skilled developers specialize in creating customized web and mobile application. By incorporating smart design and extensive experience, we help our customers achieve their goals quickly and with lower costs.