How is Microsoft Dynamics 365 for Marketing Licensed?
We recently posted an overview about the new Dynamics 365 for Marketing app and as part of its Spring 18 update, Microsoft has now shared commercial and licensing detail for the new app.
Dynamics 365 for Marketing includes email marketing, customer journey management, event management, landing pages and lead scoring for marketing teams. This is designed for small marketing teams who may be currently using disconnected email marketing, or have outgrown the basic default email marketing features of D365 at the front end of the sales process.
In contrast with other Dynamics 365 Customer Engagement apps such as Sales and Customer Service, the new Marketing app is licensed per organisation rather than on a named user basis which is consistent with most existing marketing automation providers including ClickDimensions and dotmailer.
However, while the pricing for these and many other marketing automation solutions is primarily based on usage, licensing D365 for Marketing in its launch edition is questionably based on contacts.
There is no requirement to purchase user licenses. D365 admins will be able to assign user licenses through the admin portal for users who need access to the Marketing app.
While D365 for Marketing can be purchased on a purely standalone basis, there will be greater interest and value in connecting this with other D365 apps.
Attaching to D365 Customer Engagement Plans
Organisations licensed with the Dynamics 365 Customer Engagement Plan (v9 and higher) and have 10 or more seats automatically receive entitlement to the Marketing app which forms part of this Plan.
By default, for qualifying Plan customers the base package of Dynamics 365 for Marketing is capped at 2000 contacts in the database (whether active or inactive!).
To increase capacity a 'Plan Attach' licence will firstly need to be purchased that will add capacity for a further 8000 contacts bringing this up to 10k.
For larger databases, additional contact capacity can then be purchased in increments of 5k contacts.
The main problem with this licensing approach is that not all contacts in a database will be subject to a marketing campaign but Microsoft's licensing for the launch edition of Dynamics 365 for Marketing requires a contact pack in line with the total number of active and inactive contacts.
None of this reflects actual usage of the solution. For a company with a significant number of contacts in their database that only wants to market to a fairly small percentage may find this a prohibitively expensive solution based on the current licensing model.
It is important to note that a 'Plan Attach' licence does not increase your organisation's Dynamics 365 portal entitlement. While Dynamics 365 for Marketing includes an option for an event portal this will not be available if your organisation has entitlement to deploy a default single portal and this has already been utilised.
In this instance, entitlement for an additional portal would need to be purchased, or alternatively purchase the Dynamics 365 for Marketing standalone licence.
Attaching to D365 Apps
Organisations that do not qualify for the above 'Plan Attach' licence but are licensed with individual customer engagement applications can instead purchase a Dynamics 365 for Marketing 'Application Attach' licence to get access to the base package.
This purchase will include one instance of the application with capacity for 10k contacts (active or inactive). An additional contact pack will need to be purchased if a database exceeds 10k contacts. Each pack provides extra capacity in multiples of 5k contacts.
For example, if an organisation with a database of 25k contacts (active and inactive) did not receive entitlements with a Plan licence they would need to purchase:
- 1 x Dynamics 365 for Marketing Application Attach (10k contacts)
- 3 x Additional 5k contacts (15k) contacts
In this scenario for up to 25k contacts, the total monthly price for Dynamics 365 would be approximately GBP 1130 / USD 1500
Again, in line with Microsoft's current licensing model it does not matter if significantly fewer contacts will be sent emails, this solution requires a contact package to be in place for all active and inactive contacts.
If upon renewal, a customer subsequently met the Plan 10 seat minimum an adjustment could be made to remove the 'Application Attachment' and replace this with the 'Plan Attachment'.
As with the 'Plan Attach', the 'App Attach' licence does not increase web portal entitlement so if you only have capacity for a single portal which has already been implemented this licence won't create new benefits to deploy an event portal.
Finally, non-Dynamics users can licence D365 for Marketing on a standalone basis by purchasing the base package for up to 10k contacts in addition to further contact packs @ 5k contacts as required.
This option may also be useful for some existing customers as in contrast with the above 'attach' options this licence also includes additional entitlement for a customer portal.
Dynamics 365 for Marketing is subject to a maximum of 100 active segments and the number of monthly emails sent will be limited to a maximum of up to 10 times the number of contacts purchased. Using the example of a database with 10k contacts this will support up to as many as 100k emails sent per month.
If you have any questions about the licensing of Dynamics for Marketing please get in touch, we'll be happy to discuss your requirements and offer advice.