Introduction: We're proud to welcome colleague Stephen Fairley as guest author for this month's newsletter. Stephen has a wealth of experience and knowledge when it comes to growing effective marketing strategies in law firms. As we begin to look towards the new year, what better time to hear from him on what to tackle in order to grow your firm in 2016.
It's difficult to stay on the plateau in business-either your revenues are increasing or declining and you can guarantee your expenses will increase every year. As you review your 2015 revenues, did you meet your financial goals? Did you exceed them? If you aren't pleased with how much you made or want to significantly improve in 2016 what will be different about what you do this year?
Will you change up your marketing? Reduce your overhead? Improve your conversion rate? Get more and better referrals? What's your plan? The difference between a goal and a dream is a plan. So do you have a goal or a dream? If you want to double your revenues in the next 12-24 months, but don’t have a plan that outlines how you will get there then you don’t have a goal—you have a dream!
At our two day Rainmaker Retreat legal marketing workshop, we cover three critical areas every law firm needs to focus on:
Lead Generation: more people in the pipeline, more prospects, more leads.
Lead Conversion: turning more browsers into buyers, converting prospects into paying clients, and moving contacts into contracts.
Client Retention: creating a long-time and meaningful relationship with your clients so you get repeat referrals and repeat clients.
A common question I get is: Which one is the most important? The answer is, they are all important, but attorneys tend to hyper-focus on lead generation, which is the most expensive area of the three. It's like trying to balance on a one legged stool. I constantly hear from attorneys, “I need more leads,” and in some cases, this is 100% true. But far too often, a law firm really has a lead conversion issue or a retention issue that is preventing the firm from growing to the next level. Focusing on all three of these areas is critical to your firm’s long term financial success.
While most law firm marketers are focused on lead generation, overlooking conversion and retention/referrals are costly mistakes. Lead generation is the most expensive of these three areas, so it makes sense that if you can convert a higher percentage of your prospects into paying clients, you can increase revenues without having to pay to get more leads. If you can improve client referrals, additional revenue will come in through repeat business from happy clients or a steady stream of referrals from former clients who were satisfied with the work you performed.
Lead Generation: Key Steps
Generating leads is a vital part of any law firm marketing strategy, but knowing where those leads come from, how they become clients, and the cost per conversion is just as important. The conversion of leads to paying clients is what takes you from spending money to making money – which is really the reason you are in the business of law.
Spending money on getting more leads without putting simple tracking mechanisms into place leads to wasted money. I recently spoke to a personal injury attorney in Florida, one of the most competitive markets in the nation. He's spending close to a million dollars per year on advertising, SEO, PPC, radio, and print, but when I asked him how many leads he was getting from each source he couldn’t tell me because he thought it was more important to use his “branded” phone number than to track his lead sources. What a bunch of nonsense! Please listen to me—law firms don’t brand! Nike® brands. Ford® brands. Fortune 500 companies brand. You don’t brand a law firm.
You use direct response marketing to generate leads (watch my ad then call my office for a consult). He could likely cut his marketing spend by 30-50% and make the exact same amount of money while increase his profit margins simply by using tracking phone numbers and targeted, unique domain landing pages, but noooo he's to consumed by “branding” his phone number. Seriously?! How will you ever know what part of your marketing is working if you aren’t committed to tracking where your leads are coming from and which of those leads convert into cases? By the way, asking people on the phone how they heard about you is not reliable. People will tell your intake staff what they think they want to hear or the first thing that comes to their mind (Prospect: “I heard your ad on the radio.” Intake: Which station? Prospect: “KJZZ 91.5FM.” Truth: We stopped advertising on radio last year). To make this your best year ever, make a commitment to track where every single lead is coming from this year.
Put a system in place for your front office staff and audit their compliance every week.
To discover how intake and lead conversion is working in your law firm, you need to work with your staff to identify the stages of how prospects convert into paying clients. Find out:
• Who is responsible for intake? (tip: it should never be an attorney or a paralegal)
• Who tracks and reports on the leads?
• What is your follow up protocol?
• How many times do you call and email a lead before giving up?
• What is your lead to appointment conversion rate?
• What is your conversion rate for in-person appointments versus phone only consults?
• Who does the initial consultations?
• What is the conversion rate for every person who handles initial consults?
Once you have those answers, you should analyze your intake system to find opportunities to make it more effective and streamlined wherever possible.
Like any other law firm process, your marketing efforts need to be as efficient as possible while still delivering your desired results.
4 Keys to Winning at Lead Generation.
1. Diversify your marketing efforts. The best firms never rely on just one or two ways to get leads. Tap into the power of content marketing, blogging, newsletters, and social media to generate leads.
2. Commit to tracking every single lead. Develop reports for tracking effectiveness of marketing efforts and create metrics for quantifying ROI of all major marketing initiatives.
3. Appoint an internal person who is responsible for intake, including tracking, measuring and reporting.
4. Stop relying only on “word of mouth.” Far too many attorneys place their entire financial future in the hands of a few referral sources. Make a commitment this year to diversifying the number and quality of your referral sources.
Lead Generation: How to Increase the Quality and Quantity of Your Referrals
One of the biggest mistakes that any professional who relies on referrals as a source of new clients tends to make is not educating their referral sources. It does you no good to ask someone to refer you if they have no idea what it is you are looking for in a new client. Here are the top 5 things your referral sources need to know:
1. What your ideal client looks like. You need to answer this question very specifically – i.e., “My ideal client is a high net worth individual ($1 million or more in assets), somewhere between 40 and 70 years of age, who owns their own small business with $2M to $20M in annual revenues.” “A great referral for me is a construction worker who was really hurt at work in the NYC metro area and had to be driven to the hospital in an ambulance because of their injuries.”
2. Why someone should hire you. Be sure your referral source understands the precise reasons why you are better than your competitors. “Here are three reasons why you should refer your business to me versus anyone else…”
3. What legal problems you solve. By helping your referral source understand the types of legal issues you solve for your clients, they will know what to listen for in daily conversations and be able to recommend you to someone who mentions having a problem you solve.
4. How you follow up. Your referral source needs to feel comfortable that you will follow up promptly and professionally with the people they send your way.
5. What's in it for them. In some states you can give a referral fee to other attorneys, in other states you cannot. There are things you can do everywhere every time you get a referral: send a thank you note (handwritten is better than email), send a small “thank you gift” (a bottle of wine or a gift basket to the office), take the person out to a nice dinner once in a while to show your appreciation, listen to your clients and colleagues, and most importantly look for ways to send them a referral back.
Lead Conversion: Improve Your Intake and Fix Your Follow Up
One of the fastest ways to generate more revenue is by increasing your conversion rates at each stage. Conversion starts the moment an interested prospect contacts your law firm. How many of those people turn into appointments? That's part of conversion. Start there by finding ways to increase the percentage of leads who turn into appointments. By increasing that number by just 10% you can radically improve your revenues!
Let me show you how paying attention to your intake and conversion can make a huge difference. We are working with a law firm in the Midwest with five attorneys in it. They are grossing a little over $2 Million per year and looking to double this in the next 12-18 months. They hired us to help them fix their intake and lead conversion. Last month they had the following results:
92 Leads (100%)
65 Appointments Set (71%)
55 Showed Up (85%)
7 Hired at the Initial Consult (13%)
6 Hired after the IC (11%)
Like many consumer law firms they do both in-person consults and over the phone, often leaving it up to the preference of the potential client. That month 15% of their appointments or consults were done by phone. 89% of those appointments showed up, which is pretty good. However, 0% hired at the initial consultation and 0% hired after the initial consultation. Our recommendation was obvious: stop doing any consults by phone and increase your hire rate! How many clients had they missed out on because they were trying to take the easy road and offering consults over the phone? Now your results from phone consults may be better than theirs, but you will never know unless you are dedicated to tracking it!
Most attorneys believe they are good, very good or excellent at lead conversion...and most of them are wrong! Primarily because they aren’t tracking their numbers and they are making big mistakes. You need a system and software to track your incoming leads and your conversion rate at every one of the five stages of lead conversion. Here are the five stages:
1. Number of leads coming in
2. Number of leads who turn into appointments
3. Number of appointments who show up (track by phone and in-person)
4. Number of appointments who sign up at the initial consultation (track by individual attorney)
5. Number of appointments who sign up later (track by individual attorney)
We build customized lead conversion systems for law firms. These systems track your leads, automate your follow up and help your firm improve your conversion rate at every stage. You can gain more transparency than you've ever had on which types of leads are the most profitable for your firm.
Here are a few ways to improve your conversion rate by turning leads into more appointments:
1. Institute a 5-minute follow-up rule. Every lead must be followed up within five minutes. One study by Velocify.com found your conversion rate dropped by 400% when your follow up goes from five to ten minutes! The average law firm takes four to eight hours to follow up with leads. By then all the best cases have been taken by someone else.
2. Never make an attorney or a paralegal responsible for follow up. No matter how dedicated they are, they just won't do it.
3. Train an internal staff person to handle new leads at first. When you start getting over 30-50 leads per month, hire a dedicated intake specialist.
4. Give the staff person a performance bonus to set appointments who show up.
5. Call every lead a minimum of five to seven times before giving up.
If you dedicate yourself and your staff to following these five simple steps, you will see a much greater return on your investment in lead generation by increasing your conversion rate.
Client Retention: The Art of Getting More Referrals
Yes, I know client retention is a mantra in the legal industry, but most law firms do not have any specific place in place for doing so (which makes this more of a dream than a goal). On average, acquiring a new client will cost your law firm five to ten times as much as obtaining a referral or repeat business from a former client!
One of the most effective ways to do this is with a monthly e-newsletter. Recently I asked a room of over 40 attorneys from small firms how many of them received newsletters, either electronic or print, from other professionals. Almost all of them raised their hands. Then I asked them, how many of you send out a newsletter to your prospects, clients, and referral sources every month? Only 3 of them raised their hands.
Our clients have found monthly newsletters are one of the most cost effective forms of building long-term, meaningful and influential relationships with clients and generating referrals from them. Newsletters allow you to keep in touch with clients, update them on changes and educate them at a very low cost. One of the laws of marketing is "out of sight, out of mind." If you don't keep in touch with your prospects, clients and referral sources, someone else will. The #1 reason why you aren't receiving more repeat business from your former clients is lack of connection - you haven't kept in touch with them. Make a commitment to change that this year.
If you would like to learn how to improve your marketing ROI and increase your lead conversion rate, I highly recommend you attend one of our Rainmaker Retreats. You can find out our upcoming dates at www.RainmakerRetreat.com.
About Stephen Fairley