I had an interesting conversation with a CEO who was concerned that his CRM system wasn't giving him the visibility he needed to make informed decisions about how best to grow his business. Similar conversation about the structure of data came up again with a VP in Information Technology. So I thought this is a good topic to cover in a blog post to share thoughts, learnings and engage conversation.
There are a number of different possible combinations of using Leads, Contacts, and Accounts in SFDC but IMHO there is really 3 main scenarios. We are focusing on Salesforce.com CRM as it is a very popular platform that crosses small to enterprise-sized companies but these concepts are applicable to MS CRM and others. Generally Leads don't have a direct relationship to other objects (though custom logic can be used to place a custom foreign key to Lead creating a synthetic relationship. Contacts are a related child table to Accounts (meaning contact can only exist if connect to an account). We'll explore the pros and cons of each scenario below.
Note:
Each of the scenarios below can be extended with customization through apps/code but the more customization you add the less you can directly leverage the standard reporting, automation, and data tracking innate in SFDC... create new work on the reporting stack possibly shifting the reporting from tools most users are accustom to and can easily navigate and iterate on.
Allow Duplicate Leads (Simple):
This scenario allows duplicate Leads (and often Contacts) to exist and emphasizes speed of data ingestion and follow-up, offering wider coverage, and reducing the risk of missing potential prospects.
Pros:
Easier Importing: Importing non-standardized lists (from events, vendors, other platforms, etc) becomes a breeze, even when duplicates are present. Each duplicate Lead is treated as a separate entity, simplifying the importing process and minimizing potential roadblocks.
No lost lead data: When prospects enter different information multiple times (incomplete or confusing data). Allowing duplicate leads can help capture all the information provided by prospects, even if it varies across different entries but determining which information is correct can become complex. .
Comprehensive Prospecting: By allowing duplicate Leads, you achieve a wider coverage of potential prospects. This approach ensures that every potential customer is captured within your Salesforce system, reducing missed opportunities but coordination to ensure you aren't calling the same lead over and over with different reps and messaging can be difficult... as well as having a clear understanding of the lead themselves
Cons:
Data Clutter: Allowing duplicate Leads can lead to cluttered data, making it difficult to identify genuine prospects and what is there most recent and correct data. Regular data cleaning processes and leveraging data quality tools will be crucial to maintain a healthy database. This is where some companies will create a custom link to the contact and use that as the aggregating object to have a more holistic understanding of person.
Over time untangling which piece of which record is the correct data will become painful if not converted to contact quickly
Accurate Reporting: Inflated numbers due to duplicate Leads can compromise the accuracy of your reporting and metrics. Establish clear ground rules and processes to track and convert and deduplicate Lead data accurately.
Usage:
At companies where getting the data in (clean or not is priority and will deal with cleaning after). You would think this is only the case at small companies but I was surprised to see this at a large cap company.
where quick follow-up is critical (more transactional than relationship building) because the data is spread across records and coordinating internal ownership and resources is usually not realistic across all these records
often the Lead is the record of interaction with the company (there is little use of... or the company accepts overlaps with Campaign members)
Allow Duplicates Between Leads and Contacts but not within each (transitional):
In this approach, duplicates are allowed between Leads and Contacts, ensuring seamless data collection.
Pros:
Smooth Transition: Allowing duplicates between Leads and Contacts simplifies the conversion process, preserving important details and reducing the risk of data loss. When a Lead displays stronger purchasing intent, you can convert them into a Contact without losing any valuable data.
Comprehensive Data Collection: Without restrictions on duplicates, your data is comprehensive but split across objects, ensuring that campaign responses are captured regardless of whether they belong to Leads or Contacts. This approach may make it harder to get holistic view of your prospects and customers without some data processing for reports etc.
Cons:
Data Integrity Challenges: Allowing duplicates increases the risk of data integrity issues. It requires regular deduplication efforts across objects to maintain accuracy and prevent confusion among your sales and marketing teams. Incorporating a deduplication strategy and leveraging automation tools can help mitigate this challenge. Some simple systems only synch with one of the records based on a single key (like email address)... but that is just sweeping the problem under the rug
Overlapping Information: It can be challenging to distinguish between similar Leads and Contacts, leading to confusion when engaging with potential customers. Which status is the correct one for follow-up etc.
Usage:
used at companies where getting the data (dirty or not is priority) in is priority but there is some concept of centralized ownership/follow-up and data cleansing processes
where Inside Sales or Telemarketing teams work exclusively in Lead and don't have access to Contacts
Where data to be loaded doesn't always have enough data to link to the right company
where system integration limitation (or antiquated manual business process) drove the requirement
where much of the incoming data is not likely to match to an existing account (you could create automate creating account but that starts to create a second source of dirty data that will need monitoring and clean up)
Lead and Contact - Mutually Exclusive (Recommended):
In this scenario, Leads and Contacts represent a person and each represent a different level of confidence in the data, and campaign responses are captured using Campaign Members.
Pros:
Data Organization: By keeping Leads and Contacts separate, you maintain a clear distinction between Verified prospects and new ones or potential and existing customers.
With not duplication between the Lead and Contact table this should make aggregate reporting more accurate and simplify data processing and cleansing
Clear Reporting: Leads are new unverified prospects or prospects in need of an account, Contacts are validated prospects linked to the right account (once created) and Campaign Members are the interactions they have with our company. This allows for more accurate reporting and helps you fine-tune your marketing strategies.
Cons:
More steps in Conversion Process: Converting Leads into Contacts requires manual intervention and can be time-consuming. However, if your organization requires additional lead qualification or more vetting before converting them into Contacts, this approach can provide a clearer and more controlled workflow.
Require more customization in terms of deduplication rules in your CRM and require more access and customization of views and lists if you inside sales team needs to interact with both Leads and Contacts
Usage:
Companies may use this, if they want to 2 quality levels for Individual data
Leads - for dirty un verified data... once verified (i.e. by Sales or Telemarketing) based on your business standards they can be converted to Contacts
Contacts - this should be the record moving forward for all systems to use and update to
Another scenario is you use contacts exclusively for Customer and prospect only exist as leads
one of the issues with this is you lose the value of having centralize intel on Accounts of prospects or you end up trying to duplicate the account intel on the Lead which can be alot of data processing that leads to data echos that inturn cause data quality issues
Conclusion:
The right approach depends on your organization's specific needs and workflows. My personal preference is the last scenario primarily because of clarity in the data and processing. Each scenario we discussed has its own pros and cons, and it's crucial to align your chosen strategy with your business process needs and aspirations.
Don't underestimate momentum both from what people are used to (and their unwillingness to open their minds) and the effect it will have on everyone's workflow and reporting. These can kill adoption if you are driving change and your internal customer don't feel listened to.
We would love to hear your thoughts and experiences with these different approaches. Have you found success with a particular strategy? Or perhaps you've encountered challenges along the way. Sharing knowledge and experiences helps us all grow . Let's keep the conversation going!
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