Understanding Leads and Opportunities in Dynamics 365

Leads and opportunities within Dynamics 365 are two separate entities and are used in different circumstances. If used correctly, businesses can benefit from a more organised sales pipeline, that in turn increases revenue. However, users can get confused about the differences between leads and opportunities, and when to use or the other. 

What is a lead? 

A lead is a potential customer who has indicated an interest in your product or service, potentially via a website interaction, social media, paid advertising, networking, etc. They start at the beginning of the sales funnel and at this stage, there is likely to be limited information about the business or individual.  

Once a lead has been added to the system it is now up to the sales or marketing team to nurture, then qualify or disqualify. The lead management process varies across organisations depending on the industry, product, service, etc. However, it is important that organisations standardise this process across their sales teams to ensure consistency. 

The predictive lead scoring model within Dynamics 365 Sales Insights, provides a scoring model to generate scores for leads that are available for you in your pipeline. The out-of-the-box model chooses the top factors that influence the score, however, an administrator can view and modify these factors to ensure it is suitable for your business. 

Once a lead has been qualified, it then becomes an opportunity.  

Difference between Leads and Opportunities in Sales Funnel

What is an opportunity? 

Leads and opportunities are sometimes thought to be interchangeable, this is not the case. Opportunities occur one stage further in the sales funnel and normally have more specific records around timelines, budget, service or product associated with them.   

Additionally, information from opportunities can be used to forecast revenue, giving valuable insights into whether sales teams are reaching goals, winning clients, effectively allocation resources, and much more.  

Opportunities are always associated with contacts or accounts, and they are not individual businesses or people, but rather a potential sale. It is possible to have more than one opportunity associated with an account or contact, relating to different products or services.   

Across organisations, sales teams often spend most of their time focusing on the opportunity management process. The higher the opportunity-to-sale conversion rate, the better for the business, so it is crucial that businesses manage opportunities effectively. 

Microsoft Dynamics 365 automatically creates opportunities once leads have been qualified, ensuring no opportunities are missed. Additionally, all relevant information is added to the opportunity, and the lead is closed at the same time. Qualified leads can easily be viewed within the system, should your business wish to see this data. 

It should be noted that not all opportunities are qualified from leads and can also be added manually directly into the system.

The above explanation clearly explains the difference between leads and opportunities, and how these should be used within a business. Microsoft Dynamics 365 provides a centralised solution for sales teams to effectively identify and manage leads and opportunities, alongside the ability to leverage automation and gain crucial sales insights, that can be vital in increasing revenue.