What Is Dynamics 365 Customer Engagement | How It Works

Managing customer relationships can feel overwhelming. You’re juggling emails, tracking leads, handling service requests, and trying to keep everyone on your team in sync.

Sound familiar?

Dynamics 365 Customer Engagement solves this challenge by putting all your customer interactions in one place.

Think of it as your command center for building stronger relationships, closing more deals, and keeping customers happy.

What Is Dynamics 365 Customer Engagement?

Dynamics 365 Customer Engagement is Microsoft’s cloud-based platform that helps you manage every aspect of your customer relationships.

It combines sales tools, marketing automation, customer service, and field operations into one unified system.

What makes it different:

Instead of forcing you to switch between multiple apps, everything lives in one place:

• • Your sales team can see customer service history.
  • Your service team knows about recent purchases.
  • Your marketing team understands which campaigns actually work.

The Microsoft Dynamics 365 Customer Engagement platform runs entirely in the cloud. This means you can access it from anywhere, scale up as you grow, and never worry about server maintenance or software updates.

Microsoft made significant changes in October 2019 by retiring the original bundled license that included:

• • Marketing
  • Sales
  • Customer Service
  • Field Service
  • Project Service Automation

Under the old model, you needed at least 10 seats to access marketing tools. Today’s approach gives you more flexibility—you can choose individual applications based on your actual needs without bulk purchase requirements.

Since this transition, Microsoft rebuilt the platform to run on Dataverse with Power Apps. This upgrade makes the system faster, more flexible, and easier to customize for your specific needs.

The Microsoft Dynamics 365 Customer Engagement cloud architecture handles everything from small businesses to large enterprises. You can start with what you need today and add more capabilities as your business grows.

Learn more about how Coffee + Dunn can give you a competitive edge with Dynamics 365 solutions.

Dynamics 365 CE vs. CRM

Is Dynamics 365 CE just a fancy CRM? Not quite.

While it handles marketing, sales, and customer service, Dynamics 365 CE works as a complete revenue platform that drives business growth.

The platform used to be called Dynamics CRM. Today’s version does much more than store customer data. It actively helps you spot opportunities, speed up sales, and boost revenue.

Standard CRM tools typically just organize information. Dynamics 365 CE turns that information into action.

It uses smart automation and insights to guide your next moves. The platform connects directly with Office 365, Teams, and Outlook—tools you already know and use.

This creates a unified workspace where every customer interaction becomes a chance to drive revenue.

You get the data storage of traditional CRM plus the intelligence to act on it effectively.

Traditional CRM	Dynamics 365 Customer Engagement
Stores contact details	Predicts customer behavior
Tracks basic interactions	Automates workflows
Works in isolation	Connects with all your tools through Dataverse
Requires manual updates	Updates automatically
One-size-fits-all approach	Adapts to your business

 

Dynamics 365 CE might be overkill for your business. Simple operations often work fine with basic CRM tools. The decision depends on your customer complexity and transaction values.

Microsoft built Dynamics 365 Customer Engagement for both B2B and B2C businesses. B2B companies use its account management features effectively. B2C businesses benefit when they sell high-value products or manage complex customer journeys.

These types of businesses see strong results with Dynamics 365 CE apps:

• • Healthcare organizations managing patient relationships and care coordination
  • Educational institutions tracking student engagement and outcomes
  • Financial services firms managing client portfolios and compliance
  • Distributors optimizing channel partner relationships
  • Manufacturers coordinating complex sales cycles
  • Corporate events companies managing client experiences
  • Home improvement companies tracking project lifecycles
  • Professional service firms delivering personalized client experiences

If your average transaction value is medium to high, you’ll find the suite of Dynamics 365 Customer Engagement apps better than a traditional CRM.

Benefits of Using Dynamics 365 for Customer Engagement

Dynamics 365 for customer engagement provides these benefits to businesses:

• • Ability to Align Sales and Marketing: Sales, marketing, and other business functions shouldn’t exist in separate silos. D365 Sales shares the same database as D365 Customer Insights – Journeys, meaning native integration is seamless. The integrations and enhanced data visibility allow teams to act in alignment.

• • Makes Defining And Understanding Customer Journeys Possible: With the tracking capabilities of D365 Sales and D365 Customer Insights – Journeys, you can tell who your prospects are, the platforms they found you on, and what information they need.

• • Helps With Budget Spend Allocation: When you understand customer journeys and set proper tracking parameters, you can identify effective campaigns. You can allocate more resources to them and cut losing strategies quickly.

• • Helps Create Templates for Scale: Dynamics 365 Customer Engagement allows you to create templates for various aspects of your business. This makes scaling operations much easier. For instance, with D365 Sales, you can template emails, documents, and quotes. With D365 Customer Insights, you can template landing pages, emails, forms, and other marketing assets.

• • AI Capabilities Got Better: Copilot integration brought intelligent assistance to marketing tasks.

• • Prioritization and Efficiency Goals: Both D365 Customer Insights – Journeys and D365 Sales (with Sales Insights add-on) can help you score leads. This makes it possible to identify your hottest leads. You can then allocate resources efficiently to nudge these leads across the finish line.

On the customer support side, Dynamics 365 Customer Service is also valuable.

Using the app provides these benefits:

• • Smart Case Management: AI routes cases to the right agents automatically. Built-in knowledge bases give agents instant access to solutions.

• • Complete Customer Context: Agents see full customer history, including purchases, previous interactions, and preferences. No more asking customers to repeat their stories.

• • Unified Communication: Handle phone calls, emails, chat, and social media messages from one interface. Context stays intact when conversations move between channels.

• • Faster Problem Resolution: Streamlined workflows and automated processes help agents solve issues quickly. Happy customers stay loyal customers.

• • Improved Agent Performance: Unified views, automated tasks, and collaborative tools help your support team work more efficiently.

Dynamics 365 Customer Engagement Apps

When we talk about Dynamics 365 Customer Engagement, we’re referring to a collection of separate products that work together through a shared database called Dataverse.

Each app is its own standalone product with its own licensing structure.

These individual products include:

• • Dynamics 365 Sales: Use the sales app to capture and nurture leads, log engagements, automate sales processes, forecast sales, and manage quotes, orders, and invoices.

• • Dynamics 365 Customer Insights: Get comprehensive customer views through both marketing automation (Journeys) and customer data platform (Data) capabilities. Create custom customer journeys and unify customer data from multiple sources for deeper insights.

• • Dynamics 365 Customer Service: Use the customer service app to give your agents the insights and data they need to deliver personalized customer service experiences. You get case management, omnichannel engagement, knowledge base management, and agent productivity capabilities.

• • Dynamics 365 Field Service: This app can be a lifesaver if your business dispatches field agents to customer locations. Use the app to manage and dispatch field operations and get real-time data.

• • Dynamics 365 Project Operations: Use the project operations app to manage entire project lifecycles. This ensures teams deliver projects on time and efficiently. Project managers can allocate tasks and resources, define and monitor timelines, and manage project budgets.

Each product operates independently but connects seamlessly through Microsoft’s Dataverse platform. This shared database allows data to flow between products when you use multiple apps together.

You purchase licenses for each product individually based on your needs. Pricing may vary depending on factors like your Microsoft agreement structure, nonprofit status, or volume discounts:

• • Dynamics 365 Sales: $65 or $105 or $150 per user per month (paid yearly) for the Professional, Enterprise, or Premium versions, respectively.

• • Dynamics 365 Customer Insights: $1,700 per tenant per month, paid yearly (unlimited users).

• • Dynamics 365 Customer Service: $50 or $105 or $195 per user per month (paid yearly) for the Professional, Enterprise, or Premium versions, respectively.

• • Dynamics 365 Field Service: $105 per user per month, paid yearly. You can also add external contractors for $50 per user per month, paid yearly.

• • Dynamics 365 Project Operations: $135 per user per month, paid yearly.

The modular approach is excellent as it helps you optimize spending and reduce costs. The flexibility allows you to grow and implement technology at your own pace while staying competitive.

Most businesses need D365 Sales. At Coffee + Dunn, we can help you implement D365 Sales first to ramp up demand, lead generation, and improve deal closure rates.

These improvements directly impact your bottom line. They can be the quick wins you need to gauge the effectiveness of Dynamics 365 Customer Engagement.

How to Set Up Microsoft Dynamics 365 Customer Engagement

Generally, you need to take the following steps to set up Dynamics 365 Customer Engagement:

1. 1. Purchase the relevant licenses and assign them to your user accounts
   2. Install the apps you want to use: Sales, Customer Insights, Customer Service, Field Service, and/or Project Operations
   3. Configure security, assign roles, and set up business units and teams
   4. Configure the apps to fit your sales, marketing, and customer service goals and business processes
   5. Import data from legacy systems
   6. Establish integrations where necessary
   7. Define processes and set up automations
   8. Train users and roll out the D365 CE apps
   9. Test and optimize

No two Microsoft Dynamics 365 Customer Engagement implementations are the same. Businesses have unique needs, and the apps should be configured to meet these specific needs.

This creates a scenario where two similar businesses can set up the same Dynamics 365 Customer Engagement app(s) but get vastly different ROI. The difference comes down to the efficiency and effectiveness of their implementations.

At Coffee + Dunn, we appreciate this reality and have developed a tested process for setting up Dynamics 365 for customer engagement that ensures all our customers maximize return on investment.

Our approach is captured in three verbs: Plan > Build > Run.

We’ll plan and build around your specific business goals.

Take marketing, for example. The basic idea of the marketing function is to map messaging and deploy the messages to the right audiences at the right time based on where they are in the customer journey.

In this case, planning activities would likely include:

• • Understanding your audience
  • Segmenting the audience
  • Defining the optimal communication path to reach each segment
  • Planning, budgeting, and scheduling activities

The execution activities would likely include:

• • Deploying the content and messaging
  • Collecting and measuring data
  • Optimization

The goal of setting up Dynamics 365 CE, therefore, is to marry the high-level strategic plans to create connected experiences, scale operations, and drive growth.

It requires technical experience, and you can rely on us at Coffee + Dunn to help with the planning and technical build out process.

Schedule a consultation with us today to eliminate the delays, steep learning curves, and high costs associated with DIY Dynamics 365 CE implementation.

Challenges in Implementing MS Dynamics 365 Customer Engagement

Let’s be honest – implementing Dynamics 365 isn’t always smooth sailing.

Here are the most common roadblocks businesses hit:

• • Configuration and Efficiency Problems: It’s tempting to customize Dynamics 365 to match your existing processes. But here’s the thing – if those processes already have inefficiencies, you’ll just amplify them with technology. We’ve seen this happen more times than we’d like to count.

• • Change Management Struggles: People resist change. It’s natural. Without proper training and buy-in from your team, even the best technology sits unused. Since Dynamics 365 is all about connected experiences, you need everyone on board.

• • Data Migration Nightmares: Poor data migration creates a mess – inconsistent, incomplete, or duplicate information that makes everything less effective. Getting data mapping and transfer right is crucial, but it’s often rushed or overlooked.

• • Budget Overruns and Delays: There’s a learning curve with Dynamics 365 implementation. Without the right expertise, projects stretch longer and cost more than expected. We’ve helped plenty of businesses get back on track after DIY attempts went sideways.

• • Integration Headaches: When your new system doesn’t talk to your existing CRM or ERP, data gets stuck in silos. This defeats the whole purpose of having connected systems.

Most of these challenges disappear when you work with the right implementation partner.

Let’s talk about what to look for.

How to Choose the Right Partner to Avoid These Challenges

Finding the right consultant makes all the difference.

Here’s what we recommend looking for:

• • A Certified Microsoft Partner is Ideal: Look for a certified Microsoft partner. Coffee + Dunn is a 2X Microsoft Partner of the Year and finalist – credentials that reflect real expertise and Microsoft’s trust in our work.

• • The Longer the Partner Has Been Offering the Service, the Better: D365 CE has gone through several iterations, and there are hacks and practices that can markedly improve efficiency that new players may not know. We were among the early adopters of Dynamics 365 CE, and our feedback has actually helped Microsoft improve its products.

• • The Partner Should Understand Training and Change Management: Implementation is only half the battle. Your partner should excel at training and ongoing support. We create Dynamics 365 training and technical bootcamps for Microsoft itself, so we know how to get teams up to speed quickly.

• • The Partner Should Have a Proven Approach: Look for partners with a tested approach that works across different industries. It should also scale to different business environments and processes. Our Plan > Build > Run strategy has been proven effective across various business verticals.

• • The Partner Should Get Sales and Marketing: The sales and marketing apps are inarguably the highest-leverage tools within the Dynamics 365 CE ecosystem. How you set them up may determine whether or not you get a positive return on your investment.

Ultimately, you want a partner who gets the bigger picture and understands that technology is not an end in itself. It’s the means to better alignment across your organization.

Choose someone with customer engagement services who can create a plan that fits your overall business strategy.

Best Practices for Using Dynamics 365 Customer Engagement Effectively

Want to get the most from your Dynamics 365 investment?

Here are our tried-and-true best practices:

• • Ensure Adequate Planning: Don’t rush the planning phase. Take time to ensure your new systems align with your long-term business goals. It’s tempting to jump straight to implementation, but proper planning prevents problems later.

• • Prioritize User Adoption: Start with your people in mind. Involve key stakeholders from day one to ensure everyone understands and embraces the changes. Change management isn’t an afterthought – it’s essential.

• • Invest in Scenario-Based Training: Provide customized training that reflects how your team actually works. Scenario-based training curriculum helps employees understand the system within their specific roles and processes for faster adoption and increased productivity.

• • Build Collaborative Experiences from the Onset: You’re implementing Dynamics 365 to create connected experiences for customers. Apply the same thinking internally – break down departmental silos where cross-functional visibility helps everyone.

• • Err on the Side of Simplicity: Simple systems scale better. Whether it’s sales, marketing, or customer service processes, resist the urge to overcomplicate. Start with the basics and build complexity only when needed.

Frequently Asked Questions (FAQs)

Got questions about Dynamics 365 for customer engagement? Here are the ones we hear most often.

Can I Use Just One App From the Customer Engagement Suite?

Yes! You can use just one app from the customer engagement suite. Many customers start out using only the D365 Sales app before going on to launch D365 Customer Insights – Journeys and D365 Customer Service.

For maximum business impact, however, consider using most of the apps if your operations and budget can support it, as the apps are incredibly powerful when working in unison.

Does Dynamics 365 Customer Engagement Support Omnichannel Experiences?

Yes, it does – and it’s pretty impressive. With D365 Customer Service, for example, your agents can handle conversations across voice, SMS, live chat, WhatsApp, Facebook Messenger, and more from one interface.

The best part? You can switch between channels without losing context. Your customer’s history and conversation flow stay intact no matter how they choose to connect with you.

Can I Integrate Dynamics 365 Customer Engagement with Existing Systems?

Definitely. ‘Dynamics 365 Customer Engagement’ supports advanced integrations. You can integrate with both Microsoft 365 apps and third-party systems. You can transfer data, create unified views, and set up automated actions between platforms.

This flexibility means you don’t have to rip and replace everything – you can build on what’s already working while adding new capabilities where needed.

Customer acquisition costs are rising steadily across industries, increasing by up to 60% over a five-year period, according to industry research reported by Business Wire.

To remain competitive, businesses must align their entire customer engagement strategy to maximize conversions and extract maximum value from every prospect interaction.

Dynamics 365 Customer Engagement apps are designed specifically to help you achieve the alignments and connected experiences you need to retain market competitiveness.

Coffee + Dunn exists to help you effectively deploy Dynamics 365 Customer Engagement and other customer engagement technologies. Schedule a consultation with our team to achieve seamless sales, marketing, and operations alignment within your business.