Lack of demand is a key contributor to recent economic weakness, according to U.S. economists. Law firms are feeling the pinch, as business and consumer clients limit spending. Knowing the reason for slow economic growth, however, is little consolation to lawyers who are faced with the prospect of drumming up new business.
The good news is that your best source of new revenue is marketing to current clients. The reasons are simple. Your clients know you, they trust you, and you have a proven track record of providing them valuable legal counsel. Cultivating increased business from current or past accounts also tends to enhance profitability, owing to a lower cost of customer acquisition, higher degree of client satisfaction, and favorable return on your business development time.
This article will identify ways to mine your current client base for more business. Before jumping into actual marketing techniques, however, three ground rules are suggested:
- Focus. When you sharpen the focus of your law practice to a few specialized areas, you will be able to build expertise, clarify your marketing message, and set yourself apart from the competition.
- Educate. As a lawyer, you are a respected source of knowledge on how current and pending laws affect your clients’ personal and business concerns. When your specialized knowledge serves as the foundation for your marketing campaigns, the pressure to “sell” decreases as clients naturally turn to you for advice.
- Never stop marketing. Start today to create or enhance a defined marketing process using the techniques outlined below to retain current clients, reactivate former clients, generate referrals, and highlight all areas of your legal service.
Create a Process to Stay in Touch
Like “surround sound,” which is a sophisticated series of audio techniques designed to deliver superior sound quality, the goal in this article is to create a marketing communications program for your law firm that achieves an equivalent blend of enhanced messaging.
An effective marketing campaign allows you to stay “top of mind” with your clients. You may assume that clients understand your full range of services, but this is a fallacy. Consumers are bombarded with thousands of messages daily, including outreach efforts by your competitors, and it is easy for them to forget about your law firm if you do not communicate frequently.
Start any online marketing program with a website review to ensure that your site, professional head shot, and bio page are current. Speak with your webmaster to confirm that your website’s infrastructure, metatags, and other coding techniques reflect current best practices for search engine visibility.
An accurate, up-to-date client list containing both a mailing address and an e-mail address is an essential building block for any successful marketing initiative. This may sound easy, but it frequently is not. If producing a list of clients is a challenge for you, revert to your holiday list. Also, consider hiring some extra administrative help to build or update your electronic list.
A question that frequently arises at this point is, “What should I be saying to my clients through my communications program?” Take a tip from magazines and create a simple one-page editorial calendar that identifies the topic(s) you intend to cover in each of the next six to 12 months. Start with a high-level topic for each month (e.g., business litigation), and then break your topic down into two or three subsets (e.g., breach of contract, partnership disagreements, and non-competes).
As you come across ideas for these topics, set them aside in a folder or electronic file for future reference. The questions you are asked most frequently by clients also make good marketing topics. Share success stories with clients, as well as your civic or charitable activities. Use your articles to draw attention to the types of legal services that you would like to expand.
Now that you have your editorial calendar in place, you can determine the best marketing vehicle for your communications. A blog works extremely well for this purpose. You can use your blog’s RSS feed to automatically populate other forms of social media, such as LinkedIn, Facebook, or Twitter, by using HootSuite or a similar service.
With or without a blog, an e-newsletter is the next step in establishing an ongoing client communication schedule. You can also consider a printed newsletter that is mailed, but many law firms find this to be expensive and difficult to manage.
The risk of many marketing campaigns is that they are easy to start but hard to maintain. Select a marketing schedule that is achievable for you. A monthly communication plan is ideal, but a bimonthly or quarterly schedule may be more suitable to your practice. You can always accelerate your campaigns, but you definitely want to avoid an inconsistent start-and-stop cycle. In any event, keep in mind that the more frequent your communications, the better your results are likely to be.
There are many benefits to an ongoing client communications program, particularly if you include a call to action. Suggest that clients share your material with a friend, post comments to their social media sites, attend a firm seminar, sign up for a webinar, or write back to ask for more information.
Also ask clients for introductions to friends, family members, or business associates who might benefit from your services. Build this referral request into multiple stages of your communications and fulfillment process. Natural asking points are the beginning and end of an engagement, as well as at key milestones.
Target Your Best Clients
The surround-sound marketing program described above gives you the chance to reach current clients, prospects, and inactive accounts equally. But not all clients are created equal. Although the Constitution guarantees equal protection under the law, the same concept does not apply to strategic management of your client roster. Some clients are definitely better than others. Good clients are easy to work with, respect deadlines, follow your guidance, treat your staff well, and pay their bills on time.
Because time and money for marketing programs are always in short supply, you can focus your client development efforts by categorizing your current clients. Generate a printout of all accounts within the last six to 12 months, sorted in descending order by revenue. Take the list and divide it into five equal-sized groups, with the largest accounts being Tier 1 and the smallest accounts being Tier 5.
Tier 1 accounts are clearly your most important clients, and you need to carefully maintain these relationships. Tier 2 clients have the best potential to become Tier 1 accounts, and you will want to focus your personal client development time here. Tier 3 accounts can be maintained through the automated efforts outlined above. Tier 4 accounts are targets to be moved either up or down the chain. Tier 5 accounts are those that may no longer be suitable for your firm. Working within ethical guidelines, target your Tier 5 accounts for price increases or referrals to another service provider.
Taking a Tier 2 client to lunch, off the clock, is one excellent way to build rapport. Use this time to identify the key challenges facing your client, so that you can suggest additional firm services that might be responsive to the client’s needs.
Danger signs to look for while evaluating your client list include an unhealthy reliance on one or two large accounts, as well as accounts that may be at risk owing to financial considerations or a recent change in management.
If your practice is transactional, you might use this exercise to look for shared client or case characteristics that provide insight into future marketing efforts.
While evaluating your client list, remember also to look at inactive accounts. It’s natural that over time some clients drift away. Invite former clients to start using your law firm again or at least to refer others who might use your legal services.
Cross-Sell and Up-Sell
Proven ways to increase both revenue and profitability include encouraging current clients to purchase a greater quantity of services from your law firm, increase the frequency of their engagements, or pay for premium services.
Cross-selling is the art of offering additional services to an existing client. An intellectual property attorney may determine that he can enhance the value provided to a business client that recently filed a trademark or patent application by also offering trade secret agreements to minimize the risk of employee theft, for example. Tax attorneys frequently expand service offerings to include estate planning, while a litigator may consider the use of compliance audits to facilitate goodwill through litigation avoidance.
Offering a client a more expensive service option is known as an up-sell. A labor and employment lawyer, for example, may convert a workplace dispute investigation into an engagement for development of an overall personnel policy manual. A corporate attorney working on a new product sales contract might point out the benefits of updating all contracts to reflect recent changes in the law or industry practices.
The legitimate delivery of added value is essential in law firm cross-sell or up-sell campaigns because the client must understand how additional or enhanced services are more cost-effective in the long term.
Lawyers in a large firm may explore cross-sell or up-sell opportunities with fellow attorneys in other practice groups or geographic offices. Even solo practitioners can create their own programs by partnering with noncompeting attorneys. There are barriers to this type of client development—including origination credit, poor communications, lack of trust in other attorneys, and fear of losing a client—so campaigns must be carefully crafted and maintained.
Also, try to determine if your clients are using competing law firms. You may be able to grow accounts by getting a larger “share of wallet.” A $25,000 account looks good, for example, until you realize that the client is purchasing another $75,000 in legal services elsewhere.
Most practice areas offer some form of cross-sell and up-sell opportunity. It is worth the effort to identify potential service enhancements that will enable you to offer greater legal benefit to your clients.
Bind Clients to Your Law Firm
A powerful way to increase client retention rates is to increase the “switching costs” that clients face when moving their business to another law firm.
Law firms that offer cookie-cutter types of service are at risk of losing clients to a competitor who promises lower rates and/or higher service levels. If, however, you can integrate your legal services with your clients’ business operations or personal needs, it will be much more difficult for them to defect to another lawyer.
Consider ways you can reasonably suggest a schedule of services to your clients. Periodic compliance audits, infringement analysis, tax planning sessions, or custody review are a few possible options.
Pricing or bundling packages offer a related technique to bind clients to your law firm.
Look for ways you can keep clients active, even at a low level. One example is a “General Counsel Club,” where a small business owner pays a fixed annual fee for the right to call an attorney at any time and ask questions. Naturally, some of these questions will result in larger engagements. Multiyear agreements with built-in discounts or alternative fee arrangements can also help to strengthen client relationships.
A specialized technology platform that gives your clients 24/7 access to account files via a secure Intranet connection is one way to provide responsive service while minimizing the burden of daily e-mails and phone calls. Because failure to return phone calls is a frequent client complaint, online file access can increase client satisfaction as well as retention.
Positioning yourself as a “thought leader” with in-depth legal knowledge of an industry, trade practice, or complex law can also create a “stickiness” factor that works to retain clients. Demonstrate your specialized insight through frequent client communications, speeches, articles, videos, and blog posts for best results. Initially this approach can be time consuming, but clients will pay a premium to work with an industry leader.
Evaluate switching costs from your clients’ perspective. The higher the perceived cost, the greater the pricing and profitability leverage you can reasonably achieve.
Build a Prospect Tracking System
Now that you are generating a steady volume of incoming leads, you need a place to keep track of all your prospective new business.
Your existing case management or client relationship software might work for this purpose, but so does a simple Excel file. Set up a file to record the prospect name, firm, service of interest, inquiry date, and source of the inquiry. Always focus on “next steps” to track activity through to a signed engagement letter.
A common mistake is to stop selling too soon. Industry research indicates that it takes five to six outreach efforts to get a client. You leave money on the table if you stop selling after only one or two contacts. Add prospects to your monthly communications program outlined above, and supplement with personal attention to bring in your new client.
Shortcuts to Effective Communication
As your client list grows from dozens to hundreds or even thousands of accounts over the course of your career, it is virtually impossible to remember important individual details about every person you have served.
Make it a point to create a client profile populated with key data points such as the name and age of children, spouse, hobbies, and schools. Depending on the size and complexity of your law firm, these records can be maintained in a customer relationship management (CRM) program or as notes in Microsoft Outlook. LinkedIn and Google Alerts help you stay up-to-date with clients.
All marketing and client development campaigns must be compliant with attorney advertising guidelines. Check for specific requirements with the state bar associations in the jurisdictions where you practice or solicit business.
Delegate the management of your marketing efforts for best success, even if this means hiring outside resources—your highest priority will always be meeting court deadlines and other daily demands of the practice of law.
Although marketing to your current clients is your best source of new business, do not overlook other forms of new business development. Have fun, and never stop marketing.