How to Assess Your Salesforce Licensing Needs
- Identify team roles and their Salesforce requirements.
- Determine user activity level and feature needs.
- Analyze current vs. future business requirements.
- Compare Salesforce license options for suitability.
- Consider budget constraints and license costs.
- Consult with a Salesforce specialist if needed.
How to Assess Your Salesforce Licensing Needs
Selecting the correct Salesforce license for your organization is one of the most important steps in getting the maximum value from this powerful platform.
With multiple license types, add-ons, and configurations available, it’s crucial to accurately assess your organization’s needs before purchasing.
This article serves as a guide for assessing your Salesforce licensing needs and provides detailed steps for evaluating user roles, future growth potential, and how to manage costs effectively.
Understand the Different Salesforce License Types
Salesforce offers several editions, each with different features and pricing. It’s important Before diving into your organization’s needs, it’s important to understand the different types of Salesforce licenses available:
- Sales Cloud: Designed for sales teams to manage leads, opportunities, contacts, and accounts. It’s ideal for sales representatives looking to drive new business.
- Service Cloud: Tailored for customer service teams. It includes features for managing customer cases, omnichannel support, and service analytics.
- Platform License: This license is intended for users who need access to custom applications built on the Salesforce platform without needing full CRM functionalities.
- Marketing Cloud: For marketing teams to manage campaigns, track engagement, and personalize the customer journey.
- Community License: This license provides limited access for external users, such as partners or customers, to interact with your Salesforce environment.
- Chatter Only License: This license grants access to Salesforce’s internal collaboration tool, allowing employees to participate in conversations and share files without needing CRM data access.
Understanding these license types and their intended use cases will help you evaluate what’s best for your team members and avoid over- or under-licensing.
Evaluate Your Team’s Functional Requirements
Each team within your organization has specific functions, and those functions determine the type of Salesforce license required.
Here are some critical steps to take when evaluating functional requirements:
2.1 Identify User Roles
Start by categorizing users by role:
- Sales Representatives: Typically need access to features like lead and opportunity tracking, contact management, and automation tools.
- Customer Service Agents: Need features like case management, service automation, and knowledge bases to solve customer issues efficiently.
- Executives and Leadership: Often require read-only access to reports and dashboards to stay informed about key metrics.
- Marketing Team: Needs tools for running campaigns, managing customer journeys, and analyzing marketing performance.
- Contractors and Temporary Staff: Often require limited access, which can be accommodated with Community Licenses or Chatter-Only Licenses.
By clearly defining user roles, you can match them to the appropriate license types, ensuring each individual gets what they need.
Analyze Feature Usage
Assessing the specific features each role will use is crucial in selecting the right license. Salesforce offers many capabilities, from advanced automation to AI-driven analytics. Conduct a survey or discussion with team leads to determine necessary features.
- Sales Teams: Are advanced reporting, automation, and AI-driven insights necessary, or are basic features like lead and contact management sufficient?
- Support Teams: Do they require omnichannel capabilities (e.g., email, phone, chat), or is simple case tracking enough?
- Marketing: Will they use customer journey analytics and cross-channel marketing features, or do they primarily need email campaign capabilities?
Knowing which features are mission-critical will help avoid paying for unused features and keep licensing costs down.
Assess Your Growth Potential
Salesforce licensing agreements are typically long-term (often spanning 1-3 years), so it’s essential to consider future needs and scalability.
3.1 Project User Growth
If your organization is growing, it is critical to project user numbers for the future. Consider hiring plans and expansion initiatives that might require additional licenses:
- New Teams: If you are launching new teams (e.g., customer success or a regional sales branch), factor these in when assessing your licensing needs.
- Flexibility: Negotiate with Salesforce for flexibility in your contract to add new licenses at predetermined rates. This will prevent future license additions from coming at an inflated cost.
3.2 Seasonal or Temporary Staff
Some businesses, such as retail businesses during the holiday season, have seasonal fluctuations in staff size. Consider licenses that can be activated temporarily without long-term commitments, such as Community Licenses. Negotiating this type of flexibility in the initial agreement can save costs and provide the necessary agility to scale your workforce. It is more cost-effective than standard licenses.
Evaluate Scalability and License Mix
The key to making Salesforce cost-effective is assigning licenses that align with each. To get the most out of Salesforce, consider using a mix of licenses that meet the needs of different user groups. This approach can optimize costs while ensuring all users have the required features.
4.1 Role-Based License Allocation
- Full-Use Licenses: Allocate Sales Cloud or Service Cloud licenses to users who need full access to CRM features to perform their roles effectively.
- Platform-Only Licenses: A Platform License is sufficient and more cost-effective than full CRM licenses for developers or users working exclusively with custom applications.
- Chatter Only or Community Licenses: Assign Chatter Only licenses to team members who need to stay updated and collaborate but do not need CRM data access. Use Community Licenses for external stakeholders, such as contractors or partners.
4.2 Hybrid Licensing Models
Hybrid licensing involves combining multiple types of Salesforce licenses across the organization to reduce costs and provide appropriate access:
- Sales Reps: Sales Cloud licenses for full CRM use.
- Support Agents: Service Cloud licenses for managing cases.
- Executives: Read-Only Licenses or Chatter licenses, allowing access to analytics without CRM functionalities.
- Contractors: Community Licenses for partners who only need limited system access.
By creating a hybrid model, you avoid the common pitfall of purchasing expensive licenses for users who do not require full CRM capabilities.
Perform a Cost-Benefit Analysis
Performing a cost-benefit analysis of different Salesforce licenses ensures that your investment aligns with your organization’s usage needs. This can be done by following these steps:
5.1 Calculate Total Cost of Ownership (TCO)
- Licensing Costs: Calculate the per-user cost for each license type, including any required add-ons or extensions.
- Hidden Costs: Include potential hidden costs, such as additional storage, premium support, or API usage.
5.2 Measure ROI Based on Usage
- Utilization Rates: Measure how often certain features are used. Salesforce provides Usage Reports that show login activity, feature usage, and engagement.
- Productivity Gains: Quantify productivity gains from specific features. For example, has automated lead management through Sales Cloud increased lead-to-conversion rates?
- Feature Utilization: Identify features that are not used and consider if a downgrade or different license type might be more appropriate for specific users.
5.3 Evaluate Alternatives
Trial Periods: Use Salesforce’s trial licenses to validate whether specific licenses suit your organization’s needs. This can provide clarity before committing to a full purchase. Use eSoft integration if you need extensive connectivity between multiple systems.
Platform vs. Full License: For users who primarily use custom apps, evaluate if a Platform License could provide the required capabilities at a reduced cost.
Understand Add-On Products and Customizations
Salesforce offers various add-on products that extend functionality. Based on your specific business needs, assessing whether these add-ons are necessary is essential.
7.1 Consider Add-Ons Carefully
- Salesforce CPQ: This is an add-on for configuring, pricing, and quoting complex products. Before purchasing, determine if this feature will streamline sales processes and speed up deal closures.
- Einstein Analytics: Provides AI-driven insights into sales performance and customer behavior. This can be useful for larger organizations needing deep analytics capabilities.
- Sandbox Licenses: Sandboxes are essential for testing new customizations, but based on your development cycle, consider whether full copy or developer sandboxes are needed.
7.2 Custom App Development
Platform Licenses for Custom Apps: If your organization has specific workflows that require custom applications, use Platform Licenses to give users access to these apps without paying for full CRM features.
Work with Salesforce Reps for Negotiations
Negotiating a Salesforce license agreement requires deeply understanding your current needs and potential growth. Use the assessment from the previous steps to inform your negotiations.
8.1 Know Your Requirements in Detail
When negotiating, present a clear outline of your organization’s needs, including the required number of licenses, user roles, and the specific features you need. This clarity will make you stronger when negotiating for custom packages or discounts.
8.2 Ask for Flexibility
Trial Extensions: If you need more time to validate a particular license type, ask for a trial extension. Salesforce often grants this to help organizations make informed purchasing decisions.
Temporary License Activation: If your organization has seasonal fluctuations, ask for the ability to activate and deactivate licenses as needed without penalties.
FAQ: How to Assess Your Salesforce Licensing Needs
What are the key factors to consider when assessing Salesforce licensing needs? The key factors include user roles, required features, data access needs, and the scalability of licenses to accommodate future growth. Ensure that license types align with what each team member needs for their job.
How do I determine the right number of licenses? Assess the specific roles in your organization that require Salesforce access. Consider whether the users are sales reps, support agents, or managers, and evaluate their actual usage requirements to avoid over-purchasing.
Should I include contractors when calculating licensing needs? Yes, contractors who need access to Salesforce should be included. Consider limited-use or Community licenses for contractors, as they often need fewer features than full-time staff.
How do I decide between Sales Cloud and Service Cloud licenses? If the user is focused on sales activities like lead tracking and opportunity management, go with Sales Cloud. If their focus is on customer support, managing cases, or service automation, Service Cloud is more appropriate.
What is the difference between full-access and limited-access licenses? Full-access licenses provide comprehensive functionality for CRM activities, while limited-access licenses restrict users to only specific parts of Salesforce, such as viewing reports or using custom-built apps.
How do I assess future growth for Salesforce licenses? Consider your company’s expansion plans. If you anticipate hiring more team members, ensure your contract includes the flexibility to add more licenses without penalty or at a discounted rate.
Can different Salesforce licenses be mixed within one organization? Yes, you can mix licenses to fit different roles. For example, sales reps may need Sales Cloud, customer service agents may need Service Cloud, and developers may need only Platform Licenses.
How do I determine the need for add-on licenses? Add-on licenses, like CPQ or Einstein Analytics, should be considered if specific teams need additional functionalities beyond standard CRM tools. Evaluate whether those features are critical or if existing tools can suffice.
Can I start with fewer licenses and add more later? Yes, Salesforce allows licenses to be added over time. It’s often more cost-effective to start with fewer licenses and scale as actual needs grow rather than buying too many licenses upfront.
How should I handle license needs for seasonal staff? Consider temporary or Community licenses that can be activated during peak times and deactivated when not needed. This helps control costs while ensuring access for all necessary users.
What are the benefits of role-based license assignment? Assigning licenses based on role ensures each user has the necessary tools, which helps control costs and avoids over-provisioning. This approach aligns access levels with the responsibilities of each position.
What tools can help assess Salesforce license usage? Salesforce provides built-in usage reports that track user activity and login frequency. Use these to determine whether users are using their licenses fully or if some roles could be assigned cheaper, limited-access licenses.
How does data storage affect my licensing needs? Different licenses come with different data storage limits. Assess how much data your organization generates and ensure that the licenses you select provide sufficient storage or plan to negotiate additional storage capacity.
Should I consider Salesforce Platform licenses for developers? Yes, Platform licenses are ideal for developers or users who only need access to custom applications built within Salesforce. This license type is generally more cost-effective for those who do not require full CRM functionality.
What should I do if my Salesforce license needs to be changed mid-contract? If your needs change, contact your Salesforce representative to discuss options. While mid-contract changes can be challenging, negotiating flexibility clauses during the initial contract can make adjustments smoother.
