About Dynamics 365 licensing costs

In the previous chapter, we have discussed the uses, functions, and usage scenarios of Dynamics 365. It is a highly functional product with seamless integration with existing Microsoft products. However, the appeal of Dynamics 365 is not only in its features.

How much is the basic cost of a Dynamics 365 license? In this section, we will introduce the cost of Dynamics 365 licenses in comparison with other CRM systems.

The comparison is based on costs and license names as of December 01, 2018.

Dynamics 365 licensing costs

First of all, let me conclude that compared to other CRM systems, Dynamics 365 is very cost effective.

CRM systems can be broadly classified into two categories: “high functionality” and “low cost”. I will explain what this means and why it has high cost performance, comparing it to other products.

High performance and high cost CRM system

Salesforce and Zoho CRM are well known as highly functional CRM systems that can be customized for various purposes, including functions such as customer management, sales automation, marketing automation, and integration with business systems such as Office 365 and G Suite. These CRM systems are developed for a wide range of industries, and capture the needs of those who would be happy with such functions. Salesforce, in particular, is a versatile CRM system that can be used in any industry, including sales, marketing, service, commerce, and community.

However, due to its high functionality, the license cost is still high at 18,000 yen per month. The 3,000 yen/month license also has a limit on the number of users and functions, which is insufficient if you want to use the full functionality.

Inexpensive CRM system with only basic functions

There are CRM systems that can be started inexpensively. There are CRM systems that allow you to use SFA functions for as little as 9,800 yen per month with an unlimited number of users, or as little as 1,000 yen per month if you do a search. These systems specialize in SFA and provide the minimum necessary functions such as customer information management, task and schedule management, and email sending.

However, since most systems specialize only in SFA and CRM, if you want to implement a system in a department other than sales or marketing, you will have to find another specialized system. This would result in a possible mix of systems from multiple companies for different departments and operations in the organization.

Different system creation companies have different specifications. If you want to link the data of the system you have implemented as SFA with the data of the system you have implemented for customer support, you will need to incur the cost of hiring and developing programmers for those data. Including these costs, it may be a risk to decide to implement a system just because the license cost is low.

High-performance, low-cost Dynamics 365

The situation where we had to choose between “expensive with high functionality” and “inexpensive with standard and minimum functionality” has changed with the Dynamics 365 licensing model. Dynamics 365 has the same functionality as Salesforce and Zoho CRM, but you can choose between a 1,000 yen/month license or a 12,500 yen/month license, depending on the ratio of users in your organization.

What this means is that you can choose the license you want to use according to your organization: 12,500 yen/month for the full functionality required for administrators, or 1,000 yen/month for normal use. In most companies, only a few users will have administrative privileges. If you want to add or edit data, use reports or dashboards, etc., a monthly license of 1,000 yen is sufficient.

For example, if a company has 20 people in a department such as Information Systems who are system administrators and 200 other general users (including department managers and other department administrators), the annual license cost of Dynamics 365 and the high-functionality A system that requires a monthly license of 18,000 yen would be..

For high performance A system

For Dynamics 365

Even if you compare it to the A system with almost the same functions, the difference is 42,120,000 yen per year. If the number of employees (including external collaborators) increases with the growth of the company, this difference will only increase. It is very important to choose a business system not only because it is inexpensive, but also in anticipation of the growth of the company.

Types of licenses for Dynamics 365

So, what are the licenses for Dynamics 365? And what features are available depending on the license?

Here are the current license names and costs.

*In addition, Microsoft products and licenses change their names and prices little by little according to Microsoft’s business, so the information here is current.

If you look at the Dynamics 365 Pricing page, you will find the prices.

Quote from: Dynamics 365 Pricing

Customer Engagement Plan

The Customer Engagement Plan costs ¥12,500 per month and includes the following Dynamics applications

• Sales
• Customer Service
• Project Service Automation
• Field Service
• Marketing (*)

(*) If you use 10 or more licenses of Customer Engagement Plan, you can also use the Marketing (+ up to 2000 contacts) application.

In addition, the following applications are available for application development and automated processing.

• PowerApps for Dynamics 365
• Flow

It turns out that Dynamics 365 Customer Engagement Plan is no longer just a sales support tool. You can manage all areas of your organization - sales, help desk, system development, marketing, and field service - with a single license.

General User License

The “Team Members” license is for general users, and costs 870 yen per month. The license mentioned above, which costs about 1,000 yen per month, refers to this license. In the licensing guide, it is defined as “additional users” and has basic functions such as updating clients and activities, using reports and dashboards, etc. It is available for general users.

Additional users include most of the users in the organization who use the data and reports in the core business system and perform simple tasks such as time/cost entry and updating personnel records. Additional users include most of the users in the organization who use the system to access data and reports from the core business system, perform simple tasks such as time/cost entry and updating personnel records, as well as users who use the system heavily but do not require full functionality. These additional users are the ones who use the system a lot but don’t need the full functionality. These additional users can be Dynamics 365 Team Members, Dynamics 365 Operations - Activity, and Dynamics 365 for Talent subscriptions. These additional users are licensed by Dynamics 365 Team Members, Dynamics 365 Operations - Activity and Dynamics 365 for Talent subscriptions.

Quoted from: Licensing Guide

Price of individual applications

You don’t have to use a comprehensive set of applications, you can use only Sales or Customer Service individually.

The following applications cost 10,300 yen per month.

• Sales
• Customer Service
• Project Service Automation
• Field Service

The monthly fee for Marketing starts at 81,570 yen.

It is possible to purchase individual applications like this, but since there is at least a functional difference in price from the Customer Engagement Plan, it seems more economical to purchase the Customer Engagement Plan.

There are no prices listed for the Unified Operations Plan, which includes HR, Retail, and AX functions, or the all-inclusive Dynamics 365 Plan, which you will need to contact your Microsoft representative for.

A comparison chart is below.

Quote from: Dynamics 365 Pricing

How do I purchase a license?

So far, we have a good understanding of licensing and its associated features. If you are interested in purchasing even a small number of licenses for Dynamics 365, the next step is how to purchase them.

The license purchase procedure will be described in the next issue.

So that’s it for licensing.