How challenging is getting new business for your firm?
According to the 2016 State of U.S. Small Law Firms Study conducted by Thomson Reuters, 78% of firms identified acquiring new client business as their top challenge.
How do firms address this challenge?
By getting more leads which they can convert to clients and grow the business.
You’ll need to do some marketing to achieve this.
But there’s another way to get more business that is often overlooked: cross-selling to your existing clients.
You’ll need data about your firm, your clients, and the matters you handle to do this.
How? By using practice management software.
During my stints as founder of a legal consultancy using both marketing techniques and project management tools to grow, and working for a practice management software company and then a legal marketing agency, I can say emphatically, you need both marketing and practice management to meaningfully grow your business.
There are two primary ways to get new clients.
The first is via leads. Prospects find you online, visit your website, contact you or download a piece of gated content to become a lead, then it’s up to you to convert them to paying clients.
The other way is through referrals from current and former clients, colleagues, etc.
A possible third way is by establishing relationships with Avvo, Legal Zoom, bar association referral programs, and other matching services. But that’s a story for another time.
Here’s a quick overview for solos and small firms for DIY, low-budget exposure, referral and lead-generating marketing. You will gain insight into what works and what doesn’t, and what you need help with, and armed with that knowledge, consider hiring or getting outside help for more sophisticated, goals-metrics-results driven marketing.
Identify buyer personas. A representation of who your clients are, including their demographics, behavior patterns, needs, and objectives.
Develop a content strategy. Speak to your clients’ and prospects’ issues. This can be done using blog posts, video, webinars, e-books, graphics, and so on. Repurpose content using a COPE-ing strategy.
Promote and engage – Know basic SEO and apply best practices to get your content found. Engage on social media, use email strategically, and consider PPC and social advertising campaigns to really drive leads.
Measure, track, and iterate – Use Google Analytics and marketing automation to measure the effectiveness of your strategy and campaigns and adjust your efforts accordingly.
Practice management software
Amid a shifting market for legal services you need productivity and efficiency insights into how you manage your practice, clients, and cases. You need practice management software to achieve this.
As mentioned earlier, I worked in the legal practice management space for years and know only too well the difference this technology makes in managing and growing a law practice. It gives solos and small firm lawyers deep insight into which cases and clients are revenue generators and which are a drain on the firm.
Check out the list of capabilities that Lawyerist compiled in their useful Law Practice Management Software Feature Comparison Chart.
Legal practice management software has become a crowded field. At last count Capterra lists 145 law practice management products in their pay-to-play directory.
Here’s a rundown of some of the critical productivity and financial data points legal practice management software provides that could help inform case and client management and marketing decisions:
- Who’s generating business for the firm
- What payments have been received
- How much time did it take to receive payment
- How much of each invoice is written off
- Which matters are taking the most time
- How much billable vs. non-billable time is being recorded
- Which clients are a drain on the firm and which are the most lucrative
- How many cases you’re handling per month – too many and need to hire another associate? Too few and need to generate more leads?
- How much is each case you’re working on worth?
Firms can use this data – utilization rate, realization rate, collections, case and client value, and productivity metrics – to spot bottlenecks and identify areas for additional revenue, and for productivity gains to free up time and streamline processes to handle new business.
Firms can also use this data to identify opportunities to cross-sell or upsell additional products and services.
I’ll wrap up with a story to illustrate the relationship between marketing and practice management software for growing your practice.
Earlier this year, I shared a taxi from the airport to the Hilton in Chicago where the ABA Techshow was being held and a solo attorney shared the story of her practice’s growth and the lessons she learned. Two days later, after one of my presentations, I was approached with another, similar story.
To summarize, the solo attorney, after over seven years of practice, subscribed to a practice management software which allowed her to identify her problem clients, one of which was taking up most of her time and was chronically late with payments, leaving her with a cash flow problem.
Thing is, this was her biggest client by far. But the numbers told the truth. With this data-driven insight, she fired the client and slowly but steadily grew her practice.
The other (former) solo, shared a similar story but took it one step further by hiring a marketing agency to grow the firm, which led to hiring the firm’s first new associate and assistant.
Marketing and practice management software is not an either/or decision. You simply can’t piecemeal your way to meaningful growth. You need to manage your firm effectively using the right practice management tools to gain insights for productivity and revenue gains. And, use those insights and gains to employ marketing strategy for further growth.