top of page
  • Writer's pictureDavid Avery

What are the benefits of using Salesforce leads vs. contacts or should you use both?

Salesforce Leads, Contacts, both


The topic of Salesforce.com (SFDC) Leads vs Contacts can be confusing, and many people have questions about it. Some Salesforce customers opt not to use Leads in an effort to make the marketing and sales process more streamlined by using just one record on the same object. Some feel that using Leads aren't necessary because they have a limited number of potential customers and accounts in their database. In this post, we'll explain the difference between Salesforce Leads and Contacts, and which your organization should be using.


Defining Leads and Contacts within Salesforce


a woman looking at contacts

Salesforce Leads represent potential sales opportunities that are not qualified yet. A person who becomes a Lead can be an employee of an existing customer account, a new prospect, or simply irrelevant (i.e., a junk lead, student, competitor, etc.). Typically, the idea is to create a new Lead when they first are introduced to your company from filling out a form, attending an event, receiving a cold call from a sales rep, or some other activity that opts them into further communication.


After the initial creation of the Lead in Salesforce.com, every time the person shows additional interest, that activity can be tracked with campaign member records, tasks, and events. In most B2B organizations, these additional actions receive points that accumulate a score and once the Lead has reached or exceed a threshold they'll be passed over to sales (or a BDR if your company has a Business Development team) to follow up. Once those Leads have had one or more sales conversations, they can be converted into qualified prospects (Contacts) or disqualified if they don't match the criteria. By default, Leads are not associated with any particular account or other objects in SFDC such as Opportunities.


A Salesforce Contact is usually linked to an Account, though orphaned Contacts are a possibility. You also have the option to enable a setting that lets you link a Contact with multiple Accounts, such as if they're a consultant or if the person changes jobs. As Contacts are linked with Accounts, they contain more data than what would be requested in a lead gen form. In Salesforce, you can use Opportunity Contact Roles to assign Contacts to specific roles in potential deals. This is particularly useful for large companies with a large number of Contacts under a single account where only a few employees may be involved in a particular deal. Typically a Contact will represent a real prospect that has be qualified by a sales person and represents real revenue potential for the company.

The default way to manage customer information in Salesforce involves using Leads and Contacts. However, this can be complicated since Leads are separate objects and do not have any purchase history. Eventually, Leads are turned into Contacts and cannot be changed back. Contacts, on the other hand, are meant to represent customers, partners, or affiliates and must be associated with an Account.


Benefits of using Salesforce Leads



Certified Salesforce Consultants typically suggest initiating the sales process with the Leads object. This approach can benefit your company by saving time, enhancing organization, and assisting in the monitoring of marketing ROI and customer lifecycle. Opting to use Salesforce Leads in the early stages of the buying cycle instead of Contacts can provide visibility into marketing performance and facilitate a more streamlined sales process.


Here are the top 4 reasons why you should use Leads instead of Contacts:


a head with a lightbulb and gears

1. A more organized process: Prospects can be added as Leads, which are then converted to Contacts when they become customers. This streamlines the sales process and makes it easier for your team to keep track of prospects because Marketing and BDRs can retain prospects as Leads, while Sales can work predominately with Contacts.

a laptop with a clock, gear and document

2. Automated processes: Using Salesforce automation tools, you can create automated lead nurturing campaigns and automated business rules like lead assignment, lead scoring, and queues which saves time and effort and allows for more advanced processes. You would need to build custom workflows to accomplish the same end result.

glasses

3. Improved ROI Tracking: Salesforce Leads provide better visibility into the performance of your marketing activities, enabling you to track how well your campaigns are doing in terms of ROI and leads generated. Leads have a native salesforce field, Lead Source, and built in functionality that automatically stamps this information onto Opportunities when the Lead is converted and campaign information put in the Primary Campaign Source field.

the arrows pointing up


4. Enhanced customer life cycle reporting: Leads also have a native salesforce field for tracking Lead Status. This field, allows you track a customer's experience and conversion through every stage of the buying journey to understand where your funnel is strong and where it may be weak.


Pros and Cons of using JUST Contacts

Using contacts can offer numerous benefits, which is why we recommend it to B2B companies. Here are four reasons why it might be the right choice for your company.



a man looking at a wall with pros and cons

a graph with men and women

1. Easier to segment customers: You can use contacts to categorize your customers based on different criteria. This will help you analyze your data better and enable you to send targeted marketing messages and offers to particular customer segments.

a man kneeling with a magnifying glass

2. Improved visibility: By using contacts, you can better track the performance of your sales activities and determine the success rates and revenue generated by your campaigns.

a woman with a bowl of food looking at a laptop

3. Reduced complexity: Managing customer data becomes easier and less time-consuming when using contacts, which centralize all customer information, facilitating coordination between sales reps and keeping track of customer activities. Instead of tracking the same prospect across two different objects, you can more easily see the full engagement history of the person on one object and one report, simplifying your reporting in some ways.


a banner with the word experience

4. Enhanced customer experience: With contacts, you can easily provide a personalized experience for each customer as all of their information is stored in one place.

However, it is important to note that there are also some drawbacks to using contacts. For example, they may not be the best solution for B2C companies since they lack the ability to store purchase history. Additionally, they can be confusing for large companies with a lot of contacts under one account. Below we have listed a few of the drawbacks and the solution to those drawbacks.


  • Sifting through Junk Data: To associate a contact with an account, you need to fill in the Account field. However, some forms may not include the Company Name field, which can make it challenging to infer the company when prospects use personal email addresses.

green check mark

Answer: When there is no definite Account association found, such records can be put in a general holding account called "None" or "No Account" by companies. The incomplete or incorrect data is stored in this account until representatives review and manage it appropriately.


  • Losing out on some native SFDC features: Salesforce's primary feature for following up and creating opportunities is Leads. They have built several useful features such as Lead Queues, Lead Assignment Rules, Lead Conversion Reporting, Lead "Unread by Owner" Flags, and more specifically for Leads. However, if you work with Contacts, you will have to create these features on your own.

green check mark

Answer: If you have a skilled sales ops admin, you can use Salesforce Flows or third-party tools such as LeanData or RingLead to develop workarounds.


  • Flooding accounts with many contacts: In the past, Account<>Contact relationships were limited to only the records that required communication. However, without the use of Leads, significant records are now combined with all other records under the Account.

green check mark

Answer: On an Account, you have the option to create multiple list view components to organize Contacts based on fields such as Contact Status. By doing this, you can have one list view specifically for Contacts that are important for sales to focus on, while another list view will contain all other Contacts.


  • Unexpected Complexity: Because the standard implementation of SFDC leverages Leads, many systems like Sales Automation tools and Marketing Automation tools will need require custom and often complex configuration when integration with Salesforce and adopting a Lead-to-Opp process that avoids Leads.

Red X

Answer: Sorry no advice here, no way around this one.

Ultimately, your company should carefully consider the pros and cons of using Salesforce Leads or Contacts before deciding which is best for you. Depending on the size and nature of your business, either may be more suitable. The most important thing is to choose the one that helps you manage customer data more efficiently and provides better visibility into your sales activities.


Automation with Leads & Contacts


Automating leads and Contacts

Automatically matching new people to accounts is easy if you work in a well-defined market. However, it can be quite difficult to automate this task if your market is hard to define, such as franchised restaurants with holding companies operating different brands.


Fortunately, tools like LeanData and RingLead have improved and now use fuzzy logic to recognize that IBM and International Business Machines are the same. Using these tools is the only feasible way to manage this task. We also can’t stress enough how important it is to fully map how you’ll handle un-matched Accounts, including personal emails.


You have two options:

  1. Create a master "Unknown" Account and move all contacts with incomplete data into it, including junk and unmatched hot leads. This may result in up to 15,000 contacts being added to the account, which could cause difficulty in opening the record. An SDR will need to search for the contacts, and attach them to an existing account or create a new one, which requires thoughtfulness and attention to detail.

  2. Creating multiple accounts can harm the project. If you go down that path, having hundreds or thousands of duplicate accounts can be problematic. You must either authorize your sales team to merge accounts, which can be scary or handle numerous requests for merging accounts yourself, which can be bothersome. It's worth noting that RingLead has an account de-duplication feature, while LeanData does not.


The leading cause for companies to switch back to using leads is due to unmatched accounts, which make reps and managers uneasy. Many companies also grow weary of constantly


Key Takeaways


The decision between which to use, Leads or Contacts, depends on the size and nature of your company and what you want to achieve with Salesforce. Leads can provide you with a more streamlined, automated process for managing customer data while Contacts can give you greater visibility into sales activities. While we do like to recommend using contacts in specific situations its important that you take the time and learn about both.

Regardless of the solution you choose, keep in mind that training your team on how to use Salesforce efficiently is essential for success. Additionally, having tools like LeanData or RingLead will help make managing customer data easier and more efficient.

Ultimately, it's up to you and your company to decide which is best for you - Leads or Contacts. Consider the pros and cons before making a decision, and ensure that all stakeholders are on board with your plan. With the right strategy and setup in place, Salesforce can be an invaluable tool to help improve your customer relationships.


Optimax Business Consulting can help you decide if salesforce leads or contacts are best for your business by providing the right advice and strategy to help your company realize its full potential. Schedule a free 30-minute consultation today!


Join the conversation: What do you use for your business, sales leads or contacts? Which have you had success and problems with? Do you have any advice or suggestions for people trying to decide?

7 views0 comments

Коментарі


bottom of page