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The downside to using only Contacts is the challenge of making sure that they're all qualified, not to mention, storage space. But primarily, It's all about keeping the data hygiene - garbage in/garbage out.
MKTO's Leads as either SFDC "Leads" or "Contacts" is based on types of "Leads" - known, unknown, nurture subjects, operational, etc.
I've worked at two small-midsize companies who chose to forego leads. In both cases they just grabbed a whole bunch of potential customer data an imported it as Contacts at Companies - It led to very unwieldly tasks and data maintenance.
However, if you have serious skills and IT resources for maintaining the data with great integration - it could work. I'd be curious to see it,
I agree with Lynn that working with lots of Account based records could lead to data problems.1 of 1 people found this helpful
You need to setup a robust method of handling prospects and qualification during an Account based system. Ownership would be a big problem as well. I don't know how Lynn's clients handled that.
Marketo also creates duplicate leads in situations where Contacts are not properly assigned. For instance, if you try to assign a Contact to a Queue, it creates a new dupe Lead. Clearly you wouldn't do this in an Contact only world.
There are a number of threads here on this issue, so do a bit of digging.
Thanks for tip about assigning a Contact to a Queue creating a new dupe Lead, Josh.