Salesforce Licensing & Negotiation Guide

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Salesforce Licensing Guide

If you are looking for a Salesforce licensing guide, you’ve come to the right place. We’ll explain what is Salesforce, the different types of licenses it offers, and how to assign each license to individual users. In addition, we’ll cover how to handle installation licensing issues, and give you a few tips on navigating the Salesforce licensing model. Read on to learn more. Then, you can get started on licensing for Salesforce today.

What is Salesforce

The term “Salesforce licensing” refers to the way you buy the software, and the different options available for each. Essentially, there are four basic types of Salesforce licenses. The base license gives you full access to the core CRM and any AppExchange apps. The upgrade and add-on licenses give you even more functionality. And the Enterprise edition is more than just a marketing automation system, either. It offers a lot of other benefits as well, such as enterprise-level support.

The license that you buy for Salesforce can vary based on its usage. You can buy a platform license to access its core features and services without paying a large upfront license fee. These licenses are the best option for companies that need to build an in-house team quickly and affordably. These plans include access to standard tabs, distinct objects, and exchange editions. In addition, they allow for unlimited number of users. The licensing model for Salesforce has a number of features that aren’t available on a standard license.

Platform licenses allow you to use custom applications and AppExchange apps. You also get access to core platform functionality and a small number of standard objects. However, you will be restricted from using the standard AppExchange apps and integrating them into your own business. This license is designed to allow businesses to make use of Salesforce’s platform without the high upfront costs. It also gives you full access to the Salesforce data and functionality. Its pricing is a big factor in deciding whether to buy a platform license.

Salesforce licensing models

The Salesforce licensing model can be incredibly complicated, particularly for middle-market companies. Even though the company was founded by ex-Oracle employees, the basic license is one of the most expensive licenses available and is on par with on-premises SAP licensing. Additionally, Salesforce actively audits its customers, which is often used to leverage the customer for a new contract. This can result in losing valuable grandfathered service usage rights. To get the most out of your Salesforce licenses, you should map out multiple alternative scenarios based on your demand model, confidence level, and app requirements.

Platform Starter and Platform Plus licenses offer basic functionality and include access to a limited range of standard objects. These licenses include Accounts, Contacts, Reports, and Automation Tools. Users who purchase these licenses also have access to standard individual emailing, mass-emailing functionality, and other standard Salesforce features. In addition, both Starter and Platform Plus licenses include up to 10 custom objects per user. The Platform Starter and Platform Plus licenses do not include standard applications like Opportunity, Customer, and Account.

In addition to the standard user license, there are several other licensing models for Salesforce. The first is known as the Knowledge only user license, which allows access to the Salesforce knowledge content. This license includes access to the Knowledge tab, and a profile that grants access to the Article Management and Content tab. The second type of Salesforce license is known as the Content only user license. This license grants access to the CRM Content, including Workspaces, Subscriptions, and Ideas.

4 – different Salesforce editions

#1: Essentials

Salesforce Essentials is a complete Salesforce experience. This edition for Service and Sales Cloud can be used by small teams up to 10. This edition for Service and Sales Cloud is designed for small teams of up to 10.

Other essentials features include:

Lead management to track and qualify prospective customers.

Campaign management is essential for building effective marketing campaigns and connecting with customers. Campaigns can be tracked and managed across many channels.

Integrate your email with Gmail or Outlook to get actionable data about customer interactions. This will allow you to maximize one of the most efficient marketing channels.

Mobile apps allow for quicker, more global collaboration. Essentials allows for seamless communication across time zones. This makes it easy to manage distributed teams, access data and organize meetings.

#2: Professional

Small and medium-sized businesses can use Professional to manage their entire sales cycle, including forecasting and user profiles. They can also track real-time insights and tracking. You get all the functionality from Essentials plus additional features.

You can quickly capture leads and follow up on them with lead scoring and registration. To make informed decisions about your future marketing and sales efforts, you can also measure how engaged prospects are with the brand.

Collaborative Forecasting allows you to easily understand, plan, and predict a sales cycle. You can also view the entire sales cycle in one place.

Person accounts are used to store information about individuals and not companies or industries. Person accounts are vital tools for B2C businesses, unlike standard Salesforce accounts which are intended for B2B companies.

#3: Enterprise

Salesforce Enterprise is the most popular edition. Enterprise offers all the benefits of Professional plus integration potential, large-scale team management, and is the ideal solution for companies in rapid growth who value efficiency. Enterprise also offers advanced configuration options that can be used to filter and manage your processes more efficiently.

Sales console apps let you keep track of all the data from your sales team and track it in one place.

Opportunity splits allow you to understand the individual contributions of a sales team, making it easier to allocate your efforts.

From one central location, track contracts throughout the approval and renewal process.

Unlimited custom apps means your business can create apps, customize the platform, and provide a customized experience in your CRM.

#4: Unlimited

As the name suggests, this edition is as flexible as it gets. It can be configured with as many features or as little functionality as you want. You’ll be able get the support you need 24/7. The Enterprise edition includes all of the features, but this edition also has more capabilities.

Enterprise territory management allows you to organize your sales territories in a way that is most appropriate for your business, and connect the right reps with the right customers.

Advanced reporting features include bucketing, joint report creation, and sales history tracking, so you can track every point of contact.

Automation of workflow approvals keeps efficiency high and boosts workflows.

Salesforce platform licensing

Salesforce platform licensing guides can help you decide which version of the platform to purchase. The platform is licensed by profiles, so you can assign a specific license to individual users, or groups of users. This allows you to change the license when needed, as well as assign permission sets for users. Salesforce also offers multiple plans for different levels of usage, depending on your needs. You can find more information on Salesforce platform licensing guides here. However, the best way to choose the right one for your organization is to consult with your Salesforce Account Executive.

To select the right license for your company, you need to understand what each type of license entails. The basic license provides access to Salesforce’s applications, but it does not include core CRM functionality. It also limits your ability to install standard apps and configure user permissions. This license type is best suited for smaller businesses and individuals who are not interested in CRM functionality. The most expensive license type, the Enterprise license, is usually the most expensive.

Another license type is the knowledge only license. If you are only using Salesforce for business purposes, this license allows you access to the salesforce knowledge application. This license also comes with different tabs and authorizations. You can assign users with knowledge only profiles to the article management tab, giving them full access to the feature. When using a knowledge only license, make sure to assign permission sets to all users, and assign each user to that role. This way, everyone can access the articles that are relevant to their roles.

Platform Plus and Platform Starter licenses provide the same Salesforce functionality that you know. The range of standard objects and custom objects is severely limited – there’s not much that’s sales- or service-related.

These are just a few examples of how Platform licenses might be useful:

  • Your company uses Managed packages for most of its processes
  • A particular department that does not use Opportunities (e.g. post-sales operations).
  • You may have a non-standard model of business – this is quite common for non-profits. In this case, you could be providing non-monetary goods and training or tracking applications.

Platform licenses include Accounts. Contacts. Reports. You also get the automation tools you love (e.g. Process Builder, Flow, Apex). These licenses also include standard emailing functionality for individual and bulk emails.

Depending on which license you choose, each user has access to either 10 or 110 custom objects (Starter or Plus).

Licenses can be mixed and matched, so you could have 20 Platform Starter licenses but 15 Sales Cloud licenses. As a reminder, all licenses must be on the exact Salesforce edition.

Restrictions on contract – recreating standard objects. Salesforce is very strict about this. You must pay for standard features if you copy them using custom techniques. This is the main example: Opportunities. You can copy certain functionality from therein and save money. Salesforce will take enforcement action against you if Salesforce finds out that you have violated their terms and conditions.

Salesforce license types

Salesforce offers a variety of license types to meet the needs of different types of users and organizations. Some of the main license types offered by Salesforce include:

  1. Sales Cloud licenses: These licenses are designed for sales professionals and include features such as lead and opportunity management, forecasting, and customer relationship management (CRM).
  2. Service Cloud licenses: These licenses are designed for customer service professionals and include features such as case management, live chat, and knowledge management.
  3. Marketing Cloud licenses: These licenses are designed for marketing professionals and include features such as email marketing, social media marketing, and marketing automation.
  4. Commerce Cloud licenses: These licenses are designed for e-commerce businesses and include features such as product catalog management, order management, and customer segmentation.
  5. Community Cloud licenses: These licenses are designed for building and managing online communities, and include features such as forums, blogs, and customer portals.
  6. Platform licenses: These licenses are designed for developers and include access to tools and resources for building custom applications on the Salesforce platform.
  7. Pardot licenses: These licenses are designed for B2B marketing automation and include features such as lead generation, lead nurturing, and marketing automation.
  8. Salesforce Einstein licenses: These licenses include artificial intelligence (AI) and machine learning capabilities that can be used to enhance various Salesforce products.
  9. Salesforce IoT licenses: These licenses enable organizations to connect and analyze data from Internet of Things (IoT) devices and systems.
  10. Salesforce Nonprofit Success Pack (NPSP) licenses: These licenses are designed specifically for nonprofit organizations and include features such as fundraising management, grants management, and donor relationship management.

Common Salesforce Licensing Problems:

  • Excessive spending on licenses that are not used
  • Salesforce contract policies permit license sharing
  • Licenses that include full feature licensing are available to users who have limited access
  • Incorrect Salesforce edition purchase based on business type or needs
  • Excessive data charges can be caused by bad practices
  • No renewal price contract language

Salesforce Unlimited agreement

Your Salesforce Unlimited agreement requires a minimum of 30 days’ written notice before terminating. However, in real life, many users have reported that this is less than that. The Account Executives they had been working with vanished, and were replaced with new AEs. To prevent this from happening, you must contact Salesforce well in advance of the termination date. Other potential changes include changes in product names and prices. While the contract is a heavy burden to bear, there are some situations where Salesforce may be more lenient.

A Salesforce Unlimited License Agreement (SULA) is a less common deal structure. It is typically pitched to companies that are not certain what their future licensing needs will be, and are looking for flexibility. However, this type of license agreement comes with several hidden costs and risks. You’ll be presented with these risks during the renewal process. .

SUMMARY OF SUBSCRIBILITY: An Unlimited Salesforce agreement may be beneficial for larger companies or departments that have several sales reps. But be sure to consider the costs. The annual bill can be a significant expense for many companies, so careful calculations are important before signing a Salesforce Unlimited agreement. The best way to choose the right subscription is to talk to a sales professional about your needs. There are many options and benefits with Unlimited Salesforce.

Salesforce negotiation

A successful Salesforce licensing guide negotiation begins with enterprise planning. Organizations should map out several alternative scenarios based on a demand model and confidence scale. Alternative scenarios can include adjusting the proposed timing of software deployments, opting for nothing, or implementing bare minimum contract requirements. Using this approach, organizations can increase their chances of success during negotiations. Here are some best practices to guide your negotiations. Let us take a look at each of these in more detail.

Salesforce is strategy it to sell two strategic agreement, one is the ULA which is an unlimited license agreement. It is uncapped and allows customers to deploy as much as they want. The other is the Salesforce Enterprise License Agreement, they call it SELA.

Ensure your pricing is competitive. When negotiating for a new subscription, consider how the Salesforce vendor has negotiated similar deals. If the deal is not yet close, use the previous deal as a guide. Consider the size of the deal, products involved, and users. In addition, determine the length of the commitment. Once you have a clear understanding of your company’s needs, you can begin the negotiation process. However, it will take some time. Using the sales team’s expertise in Salesforce negotiation will help you ensure that you are getting the best deal.

To avoid costly surprises in the future, identify the products you need today and for the future. Consider if you can extend the licenses to other users. You can reduce your total cost of ownership by doing so. Before you begin negotiating with Salesforce, consider your business goals and processes. Determine how you will use the Salesforce software to support the specific needs of each department. Then, identify and prioritize your specific business needs. Once you have these in mind, you can begin the Salesforce licensing guide negotiation process.

4 steps to help you negotiate better

Customers must take four steps to increase leverage and reduce risk when engaging in Salesforce. 

First, you must create an accurate demand modeling and begin the process at least six month before Salesforce deals are executed. Salesforce customers should request utilization reports to see which licenses are being used most often and to map out their needs. A confidence rating system, which takes into account the growth and shrinkage of business units, assigns a numerical level of certainty to help predict usage probability. Salesforce will create its own demand model, but it is important that you validate and decrease its overinflated projections. It is wise to have a ramp plan, as it is impossible to implement everything in one day. These tasks will help you establish a low baseline before Salesforce starts negotiations. If you need help with reviewing your utilization reports Atonement licensing can help you with this.

Step 2: Learn how SF are compensated their AM about its sales process. Salesforce reps are paid commissions based upon the amount of new spending in year one of a deal. Any commission earned in year one is multiplied by the number of years remaining on the contract. The compensation is higher the longer the term. Lastly, find out which products the vendor wants you to purchase. There is a good chance that sales reps feel incentivized by the vendor to sell products such as the latest acquisition. This information can help you build leverage and gain concessions in negotiations.

Step 3: Conduct contract risk assessment. This involves a thorough inspection of the vendor’s master service agreement (and order form) and ordering forms. It is important to establish your renewal terms. These have been removed from most MSAs. Tiered pricing tables have become a standard for entitled rates. This can make it difficult to switch rates later on. Compliance clauses, especially those that are related to restricted use licenses, and volume requirements can also lead to significant financial exposure. It is important to remember that vendor terms are often only available online and can be modified at any time.

Step 4: Have an alternative/competitive – for your Salesforce purchases. Although most customers cannot move completely off Salesforce, vendors respond quickly to any competition. Microsoft, Adobe, Oracle, and others offer many competing products that can create uncertainty for Salesforce.

Do you need help with salesforce licensing? We can help you optimize your licensing ahead of the renewal.