The Legal Marketing Association’s annual meeting is always a great conference and a valuable learning experience. BTI Principal, Jennifer Dezso, will be attending and presenting a not to be missed session for firms targeting new business from existing clients. Wednesday, April 11, 3:30 – 4:30
The Best Source of New Work — Training Your Attorneys to Use Everyday Client Interactions and Informal Client Feedback to Develop More Business
Did you realize 80 percent of your firm’s future profits will likely come from existing clients? Your attorneys are on the frontlines of driving this business development opportunity. But, BTI’s latest research shows 86 percent of attorneys think their approach to business development is not aggressive enough to win new work from clients.
The primary obstacle is not knowing how to talk to clients outside the context of current work in order to build ongoing business and cultivate bigger relationships. This interactive, train-the-trainer session will teach you how to get your partners comfortable talking shop with clients as a gateway to winning new work. You’ll leave with an agenda and discussion guide to share with your attorneys.
- Five ways attorneys can develop business without having to “sell”
- How attorneys can adopt a comfortable communication style to transition from formal matter communications to informal conversations with clients
- Six questions attorneys should be asking about their client’s business and how to use the answers to identify new opportunities
- How to lead a post-matter meeting and fill your business pipeline at the same time
Budgets may not be going up as a percentage of revenue, but per capita spending is. CMOs have been both clever and skilled in managing their budgets. Overall, increases in revenue are slightly outpacing increases in attorney headcount. Most CMOs have been able to keep their budgets untouched. This means the Marketing and Business Development (MBD) Budget per Attorney increases—in effect, resulting in an increase on a per capita basis. This is the most reliable indicator of MBD spend.
The average law firm spent $18.9 thousand per attorney on MBD in 2017, up from $17 thousand in 2016. But, spending is no longer the main story. As legal marketing budgets as a percent of revenue converge around the 2.6% mark across firms—how the money gets spent has more impact.
CMOs continue to adjust budgets to drive revenue. Legal marketing tactics and strategies can now drive success—giving CMOs and marketing departments more visibility, more impact, and more voice. This is what many CMOs have been waiting for.
(Based on BTI research conducted between June 2017 and December 2017. BTI conducted more than 160 independent, individual interviews with leading legal marketing executives at a range of law firms from Am Law 30 to Am Law 200.)
Law firms have at least 2 branding initiatives at any single point in time. One is carefully planned, orchestrated, researched, and measured to determine its success. The other is far less formal. It occurs as interactions between the individuals at your firm and people outside the firm—namely clients and potential clients. This informal branding leaves a larger and much more lasting imprint than your formal initiatives.
The good and the bad news is the interactions between your firm and the rest of the world are almost limitless. But of this plethora of interactions, our research shows 7 stand out with much more impact than all the others:
Inevitable scope changes either destroy or boost your brand. They are never neutral. The firms actively discussing scope changes with clients on a real-time basis look good and make their client look good. Your client can announce changes to their internal stakeholders well in advance of completion and look like they are in control and know where things are headed. Clients brand these proactive firms as being on top of their plan, strategy, and able to adapt on the fly.
Clients remark the firms not reporting the impact of scope changes on a timely basis are just not client focused and/or not thinking about their matters strategically. Neither is likely to get you more business.
How You Treat Your Client in the Courtroom or Negotiations in Front of the Other Side
Top legal decision makers tell us they learn so much about firms by watching them in the courtroom, negotiating deals, dealing with regulators, or in action somewhere. They watch the legal strategy unfold, but are equally mindful of how these attorneys treat their clients. Some describe opposing attorneys as heavy handed and dogmatic while others envy how the other side behaves. Equal numbers of corporate counsel make the decision either to hire the other side the next time out or to never use them based on what they see during a live performance.
Clients believe they are seeing you at your best. Whatever you present, say, and do brands you forever, or at least for a very long time. This is the ultimate direct experience. Clients presume the insight you bring during the pitch will be the level they can expect during your work together. The look and feel of your presentation, the level of interactivity, the level of teamwork, the specificity you bring, and the ease with which you move through the pitch set the expectation—and to a large extent—tell clients what your firm is worth.
Your Final Invoice
The one document every single client reads. Whether or not you’ve discussed it in advance, clients always have a figure in mind of what your services will cost. They expect your invoice to be reflective of their expectations and expect it to be concise. The minute your final invoice includes any billings your client doesn’t already know about, the negative branding begins. Your final invoice represents the culmination of your strategy, planning, and ability to execute the plan.
When your invoice doesn’t match the client’s expectations, clients immediately know this is about surprise charges, untold changes in scope, impacts of unplanned events, or changes in fact and circumstance. If your client learns any of these things through the invoice and not in a conversation with you at the time of the change, they will label your firm as unreliable. To clients, their budget is just as important as the outcome.
The budget is one of the items which clients report to others outside the department. When clients have to explain budget overruns to their boss—or worse, the Board—they look bad in front of the people who matter most. The firms making them look bad are branded forever.
And if your client never brings up the budget, remember: Every client has a budget, even when they have no budget at all.
Your Voicemail Message
Clients believe your voicemail message speaks volumes about your approach to client service and individual clients. Clients want to know when you will be back and when you will be answering calls. They also want a reference to someone they can reach for immediate needs.
Top legal decision makers take note of the attorneys who are silent about when they will return; the messages just saying “leave a message,” and those saying they will “reply at their earliest convenience.” Clients brand these attorneys as those not to call with important and time-sensitive matters.
Your Email Signature
Clients want to be able to reach you when they want. All things being equal, which they often are, convenient access to your email and phone are surprisingly essential. This is especially true for questions about new issues and when your client wants to brainstorm or is looking for an opinion. These are the conversations which lead to new work. Be sure to include your email, direct office number, and cell phone in every email (and reply email) to clients.
Asking for Meaningful Client Feedback
Law firms seeking client feedback are still in the minority. This applies to the hardcore feedback which clients believe is so important to improving performance—and to making their own life easier. The law firms conducting world-class client feedback interviews where clients learn something about themselves and you learn how to improve, differentiate themselves from other firms.
You can turn unintended branding into a positive brand differentiator for your firm by exercising the same diligence as you do to intentional branding initiatives. Embracing the tools like scripts for voicemails, templates for email signatures, hardcore training for client-focused pitches, and measuring how quickly you tell clients about scope changes will all harness the power of unintentional branding. You will not enjoy a stronger and more unified brand—you will stop unintentional branding from standing in the way of winning the next piece of new work.
Fred Flintstone lived in a time when the concept of modern counting for tallying and tracking was coming into widespread use. As Big Data and AI try to muscle their way into law firms—you can still rely on a few Stone Age tools to reliably develop business and keep more clients.
Counting clients and their billings annually is a simple, important, and woefully underutilized business development tool, especially this time of year. Go count how many top clients you have this year—and compare this list to last year—name by name, billings to billings. Perform this analysis on your top 50 to 200 clients. If you’re brave, perform this analysis for each of the last 3 to 5 years—where some of our clients found a gold mine of new work.
Any top client who shrank to become a regular client deserves immediate attention, as does any client where billings shrank at all. It doesn’t matter how much they shrank—nothing good ever comes from shrinking fees.
Immediately investigate and learn exactly why these clients dropped down the list. Don’t be fooled by the premise of “one and done” or “the case ended.” There is always a reason. Clients have ongoing needs and ongoing spending—and they keep using law firms on a regular basis. This just-lost source of business is fertile ground for client and business development. Client feedback is invaluable with these clients.
This client retention and measurement calculation is your roadmap for landing new business right now. Go and develop clients where your relationships are still warm. Your clients just may be wondering why no one from your firm ever followed up after the last engagement.
BTI research shows only 48% of law firms calculated any kind of client retention rate in 2017, up from 40% 3 years ago. The typical law firm calculating its top client retention rate kept 85% of their clients on a year-over-year basis, up from 80% 4 years ago. The increased retention alone can be worth $30 million dollars in new revenue at an Am Law 200 firm—and the same proportionate gain applies to smaller firms.
For my money, I would stop or postpone another project and calculate my firm’s client retention rate for the top 50 clients, at least. I would look at 3 factors:
- Changes in billings, year over year
- Rank in the top 50, year over year
- 3-year compound growth rate in billings
The numbers will tell the rest of the story. And define your path.
All you need to do is reinvigorate 1 major client and even the most skeptical partners will be inclined to shout: “Yabba dabba doo!”
(This research is based on interviews with more than 180 law firm marketing leaders conducted over the last 12 months.)
Shoddy work is driving clients crazy. And, it is driving twice as many clients crazy—in fact, 22% in 2017, up from 11% the previous year.
Most of this sub-par work is unintentional. Certain law firms don’t even know they are missing the mark. What’s worse—clients simply let these firms fade away never to be hired again. Few law firms ask for client feedback, so they never learn what they’re doing wrong (or right). The decline of quality work is reflected in clients’ growing impatience and in their redefinition of quality. Here’s how it happens:
Missing the Mark
Certain law firms didn’t do what clients asked. These firms often believe they did, but their clients think otherwise. Clients say these firms racked up a lot of hours, and more importantly, precious time passed before clients figured it out.
The law firms believed in their heart they knew what the client wanted. But these firms did not confirm their strategy, work plan, and overall approach. They did not confirm the scope. They may have provided a budget—but figured they could blow through it if needed. And off they went, with the best of intentions, delivering shoddy work because the client couldn’t use it.
Other firms believed their client’s goal was unrealistic. Acting in what they believed to be their client’s interest, they changed course. These self-correcting firms added people and tasks to do the right thing. They worked into the night making sure no deadline was missed. And a few developed irrefutable research to back their positions. The only missing element was the most important one: sharing any of this with their client—who was ultimately stunned by the invoice and the strategy—and not getting what they want. Maybe their client’s goal was unrealistic, but the responsibility lies with law firms to tell their clients why—on a timely basis.
These miscommunications are the biggest reason even the best technical legal work turns shoddy in the eyes of clients.
I Know Something You Don’t
Silence during ongoing work has graduated from annoying to shoddy. Silence undermines confidence and can make clients look bad. Corporate counsel expect to be advised and updated on a regular, systematic basis, and when needed for unique events. Anything less is low quality and signals clients are not front and center. Or worse—no one person is looking out for the client.
Top legal officers believe the budget is a proxy for strategy and risk management. Clients know budgets change—but they don’t change at the end of a matter—changes can be seen and managed. Clients have concluded an over-budget final invoice represents their firm’s lack of planning and the use of an ad hoc approach to their work. No management means no quality.
Clients still talk of faulty research, incorrect citations, and mistakes showing up in their documents. These are relatively rare in comparison and not something clients worry about and look for; and somehow, they don’t drive clients crazy. Maybe because they don’t leave the legal department and are easily fixed.
Clients have neither the budget nor time to deal with issues they believe should never have come about in the first place. The main safeguard against shoddy work: over-communicate with your clients. Always tell and retell clients what you are doing and why. And tell them once more, to play it safe. As one top legal officer put it, “Communicate until it hurts.”
(Based on BTI research conducted on a rolling basis between February 2017 and December 2017. BTI conducted more than 350 independent, individual interviews with CLOs and General Counsel at Fortune 1000 companies and large organizations)