Lawyer referral and information services have been around for years; you might think there’s nothing new under the sun, and that you know everything you need to know about this type of program.
Those who attended a joint workshop on LRIS at the Midyear Meeting of the National Association of Bar Executives, the National Conference of Bar Presidents, and the National Conference of Bar Foundations were rewarded with fresh, new information that might change how they think about this public service that can also be a nondues revenue powerhouse.
The revenue potential, and the potential to assist members of the public and bar members as well, is more compelling than bar leaders often imagine, the panelists said, and the landscape has changed so much recently that bar leaders may need to rethink how they are publicizing their LRIS. (Note: Some programs are called lawyer referral services, or LRS; for consistency, we’ll use LRIS throughout.)
How does an LRIS make revenue?
If your bar has an LRIS that is not pulling in significant nondues revenue and not serving bar members and members of the public as powerfully as you might hope, then Jeannie Rollo, executive director of the Lawyer Referral Service of Central Texas, recommends that you check whether two key elements are in place.
For the LRIS to reach its full potential, she said, there must be money in the budget for designated staff to take the calls and do follow-up, and there must be technology in place to help you track what happens with every contact and every resulting referral. The technology is not complicated, she noted; off-the-shelf software is sufficient to help you with follow-up, which includes helping LRIS panel members keep track of fees and remember to pay the LRIS in a timely fashion.
As far as what, exactly, LRIS panel members pay in order to participate, the workshop panelists said this can vary. Typically, there’s an LRIS membership fee, which Rollo said provides stable, relatively predictable revenue—but, she added, isn’t enough for the LRIS to really take off. Then there’s a consultation fee, perhaps $20 for a member of the public to speak with a lawyer for 30 minutes.
The consultation fee may be waived in some circumstances, such as personal injury or bankruptcy cases, Rollo said. Lawyers in those practice areas generally don’t charge consultation fees, so her LRIS has opted to follow suit.
If your LRIS simply charges the membership fee and the consultation fee, Rollo said, it’s likely that the bar will need to subsidize it at least partially; the real key to significant revenue is through percentage fees. George D. Wolff, referral and information services manager at the Oregon State Bar, said 78 percent of LRIS programs charge a percentage fee, meaning that when the lawyer takes on a client through the LRIS, he or she pays the LRIS a certain percentage of the attorney fees from the resulting work. Oregon’s LRIS does not collect such a fee, but Wolff indicated that this may change.
To illustrate that the percentage fee holds much of the revenue potential, Rollo broke down how much her LRIS made from each type of fee last year. Revenue from membership fees was $69,700 (only $55,000 had been budgeted for); from consultation fees, $53,800, and from percentage fees, $553,000.
Panel members deduct $400 for small matters and then give 15 percent back to the LRIS, Rollo noted, adding that they aren’t allowed to increase their legal fees for LRIS clients in order to cover that percentage.
The numbers she cited are big, but most of the cases are small, Rollo said. Last year, 770 of the percentage payments were under $1,000 each, 94 were between $1,000 and $3,000, seven were more than $3,000, and two were around $10,000.
There can be pleasant surprises, noted moderator Lanneau William Lambert Jr., past president of the South Carolina Bar and current member of the NCBP Executive Council and the ABA Standing Committee on Lawyer Referral and Information Service. For one LRIS he knows of, the percentage fee is 10 percent, and in one case—involving insurance bad faith—that meant a small firm paid the LRIS more than $600,000.
If you get such a windfall, Rollo cautioned, it’s important to pull that fee out when you’re working on the budget for the following year.
A public service
Just as it’s important to realize that an LRIS can bring in some serious money, it’s also important to remember that it’s a valuable public service, the workshop panelists said.
“At bottom,” Wolff said, “your LRIS is an integral part of the access to legal services delivery system.” For one thing, he noted, the percentage fees can allow you to contribute to legal services organizations that serve at-risk or indigent populations. Indeed, Rollo noted, her LRIS contributes more than $100,000 a year to such groups.
And even though LRIS clients can afford to pay for legal services (and some services also have modest means panels), there are some barriers that often prevent them from seeking legal help. A person who has never consulted with a lawyer might feel apprehensive about how to find a qualified one, Wolff said. For-profit referral services often tap into that fear for their own benefit, he added; a nonprofit LRIS can instead “be positive and offer solutions.”
On behalf of its members, a bar association works to establish a positive reputation in its community, Wolff said; by providing a convenient way to access skilled, dependable lawyers, the LRIS is “constantly communicating that message of credibility and trust.”
Agreed panelist Sheldon J. Warren, chair of the ABA Standing Committee on Lawyer Referral and Information Service, “Your lawyer referral service is the face of your bar association to the public that it serves.”
To enhance the public service aspect of the LRIS, Wolff added, the service’s website could include videos, FAQs, and other tools to help consumers prepare for an initial consultation with a lawyer. Perhaps especially if there’s a modest means program in place, Wolff said, the LRIS should connect with religious institutions, hospital chaplains, social workers, the department of human services, and other individuals or organizations that work with people who might need legal representation. Getting the word out about the LRIS can help ensure that these groups include it in their “backpack of resources” for the public.
Wolff shared a creative way his LRIS gets the word out: Denial letters to those who apply for court-appointed counsel now give information about how to seek affordable legal assistance through the modest means panel.
… And a member service
The other side of the coin is that a referral service can be a tremendous help to members, perhaps especially solo and small-firm practitioners who appreciate being placed on a level playing field with those from larger firms. Particularly during the recession, Wolff said, the LRIS can be marketed to all lawyers as a way the bar can give them a helping hand.
Offering an LRIS is “meaningful, if not critical, during an economic downturn,” Wolff said, noting that many Oregon lawyers have called it the most valuable service the bar provides, and that some solo and small-firm practitioners call the service their “outside marketing firm.”
The LRIS is often perceived as a training ground and business generator for young lawyers, Wolff said, but this perception is only partially true. The average age of panelists in Oregon is 48, he said, adding that the ABA sees approximately that same average nationwide. Most panelists in Oregon have been in practice for more than 16 years, Wolff said. However, the next largest age group among Oregon panelists is young lawyers. Wolff said that for this age group, the LRIS offers a chance for lawyers to “hone their skills” in a measured environment.
As for monetary potential for members, Lambert said it’s easy enough to do the math and figure out what the small firm in the example he gave made from that single LRIS case. But even under more ordinary circumstances, the money can be significant. Warren said the Los Angeles County Bar Association Lawyer Referral and Information Service consistently brings in at least $4 million for its panelists each year, and he has found this to be true for other LRIS programs, too.
New approaches to marketing
Some methods of marketing your LRIS are tried and true, and relatively low cost, said workshop panelist Kalie Moore, lawyer referral service program administrator at the Alameda County (Calif.) Bar Association. Some of these ideas might include putting up posters at the public library, and having the service’s logo and perhaps some information on forms or brochures given out at the courthouse.
Rollo’s service advertises on cable TV, sponsors public service events, and buys what are called “billboards”—radio ads in which, say, the drivetime traffic report is “brought to you by” the LRIS. Typically, she said, the LRIS buys these ads on talk or news stations, or public radio stations; the aim is to reach listeners who can afford to pay a lawyer and just need help finding one.
One traditional vehicle that does not seem to work well anymore is the Yellow Pages, Moore said. When she started her job in 2007, much of the referral service’s advertising budget was allocated toward a Yellow Pages ad. It cost $30,000 and brought in just three referrals. Moore eliminated that form of advertising in order to focus more on online marketing vehicles, including social media. Rollo noted that she has seen a dramatic decrease in callers finding her LRIS through the Yellow Pages: from 10.5 percent of referral users in 2007, to 5 percent in 2010.
Moore has seen, too, that the initial searches that occur online are more likely to result in viable cases; last year, 40 percent of the referral fees for her service came from people who had found it online. She plans to increase the service’s online presence this year; after all, she said, studies show that more than 4 million people used Google to search for a lawyer in the past 30 days.
Moore recommended using a mix of methods to make an LRIS more visible to those online searchers. First, she said, look into search engine optimization, which involves keywords and other techniques that can make it easier for Google to find you and place you higher on the search results page (for more information, see “Out of the shadows: Boosting your bar’s visibility with search engine optimization,” Winter 2011, page 20). You might even consider having someone help you with this for a onetime fee, she suggested.
Another option is to buy a Google ad, she said; these appear on the right-hand column of a Google search results page. Prices—and the likelihood that someone will “click through” to your site—vary depending on whether yours is the top ad, the middle, or the bottom, Moore noted.
If you’re not familiar with Yelp, an online platform through which consumers post ratings of all manner of businesses and professionals, Moore recommended looking into it. It’s possible, she explained, that LRIS users have been rating the service and you don’t even know it. Moore suggested that an LRIS might wish to set up its own Yelp page and ask satisfied clients to rate the service. Not only will this help pull people in directly from Yelp, but Google “likes” Yelp ratings, and these can move you up higher on the results page.
Likewise, she said, Google “likes” Facebook. The paid ads (which also appear on the right of the page), currently cost only one-sixth as much as other types of online ads—but Moore expects that will change at some point. One of the main selling points for Facebook ads, she noted, is that they can be incredibly targeted. For example, if your referral service happens to get a call from a Hispanic person who says he or she has been discriminated against at work, you could run an ad that asks, “Are you being discriminated against at work?” and then gives the LRIS contact information. You could specify that the ad only be seen by people who have indicated that they work at that same place and are Hispanic.
As another example, Moore said that divorce lawyers usually see an uptick in calls during the week after Thanksgiving. You could run a divorce-related LRIS ad that week and specify that it be seen only by married, college-educated women.
The Alameda lawyer referral service does have a Facebook ad, Moore said. It has received 5 million impressions (meaning the number of times the ad was seen by Facebook users), and 600 clicks. So far, the ad has brought in $2,000 in fees for the referral service.
Twitter is another area to explore, she said; she has used the search feature there to send a message to all users who have mentioned that they’re looking for a lawyer. The message suggests they use their local LRIS, and directs them to the ABA’s online lawyer referral directory (http://apps.americanbar.org/legalservices/lris/directory/home.html).
Moore has not heard of many other referral services that are using social media. She believes that’s a mistake, given the results of a recent study from the Pew Research Center. Among Internet users who are between 18 and 29, 77 percent said they use social media. For Internet users from 30 to 49, the percentage was 55, and for those 50 and up, it was 23. Social media use among that final age category has been growing lately, Moore said.
Moore urged others to test the waters as her service has. If you don’t, she believes, “You’re really missing out on your target market, which is people who can afford to pay a lawyer.”