As a lawyer hanging her own shingle for the first time, serving as many clients as possible in as many areas of the law as you can handle may seem like the best way to maximize revenue.
But California attorney Dan X. Nguyen says that such conventional business thinking may work for the Walmarts of the world – but not for lawyers.
In his recent article for GP Solo Magazine, “How to be Profitable in Several Niches (Even if You Don’t Think You Can),” Nguyen instead advises new solo attorneys to narrow their market.
While practicing “front-door law”—taking anything that walks in the front door—and “toaster law” – taking anything that pops up—may be a necessity in the beginning, Nguyen says that finding your niche in the law will eventually pay off with increased client traffic and higher profits.
How? Simply put, “doing the same thing over and over is great for business,” Nguyen says. The repetition reduces the time spent doing the same kind of work for each new client. And most important, you develop an expertise in that area.
Niching is how some attorneys can charge as much as $1,000 per hour: “There are probably very few people who can do what they do in the same amount of time,” Nguyen says.
Putting his own advice into practice, Nguyen has found success over the past decade focused on serving the legal needs of small- and medium-sized businesses in Orange County, Calif. Along the way, he’s learned useful advice for those seeking a similar path, which he’s distilled into four practical tips:
- Serve a particular industry: Focusing on a certain industry can pay off in spades, particularly if you are one of only a handful of others in the field. “I was servicing a client that needed a specialist in alcohol; there were only two other firms in the state that specialized in it, and the other firm was conflicted out of the matter,” Nguyen recalls. “The Only Choice in Town is not a bad place to be when you are a business owner.”
Moreover, “all the owners and executives of these companies tend to keep company together, so it’s a good way to get your name passed around,” Nguyen says.
- Seek ways to serve existing clients: “One of the cheapest ways to get new business is to help existing customers,” says Nguyen, citing the example of a colleague in family law who recently expanded with estate planning services. Why? “Because after the parties get a divorce, her clients always need an estate plan,” he explains.
You’re not only reducing your client acquisition cost by doing such cross-selling, but it also benefits your customers. Adding a practice area that relates to your others allows clients to keep their business “in house” with you, where the trust you’ve built in one area of the law transfers to another.
- Consider downturns: The unpredictability of revenue is a hallmark of the first couple of years of many solo and small-firm practices. But, “if done right, having multiple practice areas can shield you from any downturns,” advises Nguyen.
“For instance, estate planning attorneys tend to slow down during the holidays. What areas of law pick up during that time? DUI perhaps?”
- Tailor your marketing: One of the keys to successfully marketing a niche practice is understanding who your clients are and marketing your services specifically to those customers. It starts by defining your niche as narrowly as you can, identifying both your practice area and your ideal client.
Being able to target the kind of clients you want will help you avoid this comment at your next networking event: “You do so many things, I don’t even know what business to refer you.”
GP Solo Magazine is a publication of the ABA Solo, Small Firm and General Practice Division.
For more guidance on establishing a successful niche practice, read “Niche Marketing: (My) Case Study,” in the September/October edition of Law Practice magazine, a publication of the ABA Law Practice Division.