How To Raise Your Fee and Have Your Clients Love You For Doing It
One of the ways I work with attorneys to improve their income is by helping them implement value-based pricing. Whenever I survey my clients, this one topic is identified as the most valuable thing they discover in working with me. It is also the single biggest factor in law firm marketing. After all, if you can get your clients to see your services as incredibly valuable, you can make more money per client. This means you need to see fewer clients and do less work to make more money.
Here are two stories that illustrate my point (the names have been changed to protect the newly-reformed):
Intellectual Property Lawyer Triples his Income Overnight
Pat is an intellectual property attorney who came to me complaining about the number of hours he worked. His biggest complaint was that he was working on too many small matters. Since there are no small matters, only small fees, I delved into his client list and we made some adjustments.
It seems Pat was filing about five trademark applications per month for his clients and charging $1,500 each. His justification for this fee was: “This is what everyone else charges.”
The first adjustment we made was to Pat’s mindset. When a business owner owns a trademark he owns an asset. This is a thing of value to his business. It helps build equity. This means filing a trademark application and having it approved is making a sound investment (not unlike investing in Real Estate or the Stock Market).
But that is not all Pat’s clients are investing in. They are also investing in a relationship WITH HIM. (This was a new philosophy for Pat). This investment in the relationship means that all the work done on this matter would be covered by one fee (less the government filing charges). If it took 20 revisions to get the mark approved, Pat would resubmit the paperwork 20 times. Once the client invested in Pat, he would not need to spend another penny on this matter.
Finally, we added the glue that cemented the relationship between Pat and his clients. We offered three years of monitoring to protect the trademark from infringement and we offered LIFETIME consultations on this trademark INCLUDED in the fee. This means ten years from now, if someone has a question about this particular trademark, they can call Pat and he will answer their question for free.
The outcome: Pat was able to move from charging $1,500 for filing a trademark application to charging $4,997 for a trademark application.
The Will To Bill
Joe is a Trust and Estates attorney. He came to me complaining that people would not pay more than $500 for him to write their will. He said this was all he could charge since everyone else in town was charging that fee.
After interviewing Joe I learned there were three other documents that were critical to setting up a sound estate plan. I also learned that Joe’s average client revises these documents at least once during their lifetime. Finally, Joe told me that most of his clients only learned of advantageous changes in the law when he brought them up.
Under my guidance, Joe immediately stopped offering the drafting of a will as a standalone service. Instead, he began offering his clients a long-term relationship that included the drafting of all estate planning documents, the review of twelve different kinds of legal contracts (including mortgage documents, auto financing agreements, leases, basically any document that bound his client to an investment of $1,000 or more) and two estate planning meetings per year.
Overnight Joe went from being the guy who writes the will to becoming a trusted family advisor.
How did this affect his income? Well, remember that Joe was charging $500 for the drafting of a will? Now he charges $2,400 per year for his Concierge Legal Service. And oh, by the way, he went back to his clients who paid $500 for their will and he was able to sign up more than half of them to the new relationship.
There are a couple of significant points to make about these stories:
First: You may think this is not applicable to you and your law firm. If you do, you are DEAD WRONG. This is applicable to every attorney in every law practice. We have even used it for litigation. I have given you two examples – one in a business to business setting and one in a consumer setting. There is absolutely no value in thinking that you cannot use this model in your law firm. You absolutely can.
Second: You need to wake up. Your clients do not pay for the documents you draft. They do not pay for the time you spend arguing with your opposition. They do not pay for the research you do. They pay for your expertise, they pay for your guidance, and they pay for the privilege of HAVING A RELATIONSHIP with a great lawyer.
If you want to discover the dozens of ways you can elevate your status in the eyes of your client (and charge higher fees) give me a call today.
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EmailWhat Do People Think Of When They Hear Your Name?
Who is the best lawyer in town in your practice area?
The answer depends on education, experience and positioning. Two out of three of these attributes are easily accepted. Education is important because it shows that you have the discipline and the desire to truly understand the principles behind the action. Experience is important because it helps you put things into proper perspective. But most people are perplexed when I tell them that positioning is a determining factor in their career success.
Positioning means creating an identity in the minds of the people in your target market. It is THE MOST IMPORTANT factor in determining how successful you will be as a lawyer. You can be the greatest lawyer on the planet but if you are positioned wrong, you will not be able to attract quality clients or command high fees. It is up to you to influence the perception your future clients have of you. Here are three ways to position yourself as an expert.
Focus on a Targeted Niche
If you want to be perceived as an expert you must become known as an authority in at least one focused niche. There is no better way to tilt the landscape in your favor than to drill deeply into one area of the law and claim it as your own.
I am not talking about practicing law only in one specific area. I am talking about marketing your law firm to a focused group of clients for a specific application of the law. Want some examples?
- Focusing on immigration law is not enough. Focusing on immigration law related to individuals with extraordinary ability is much better.
- Focusing on intellectual property law is not enough. Focusing on managed service agreements is better.
- Focusing on criminal defense law is not enough. Focusing on defense of computer related crimes is better.
You can still accept clients outside of those areas of focus. But your marketing should be exclusively dedicated to your niche market.
Demand Appropriate Compensation
Experts get paid better than generalists. Experts command high fees. Experts can basically charge whatever they want.
My practice is the perfect example of this principle. I focus my marketing efforts exclusively on attracting lawyers. I make recommendations and the clients who implement them achieve outstanding results. In the past year, one of my clients went from start-up to over $370,000 in billing. Do you think he blinked at writing a check for his investment in my services? Three people in my Strategic Advisory Groups have doubled their billing compared to last year (in less than five months). Do you think they mind making the required investment to be in that program?
If your clients want to work with the best, they have to pay for that privilege. Your marketing establishes you as an expert. You can then command expert-level compensation.
Educate Your Prospective Clients
Educational marketing is the most valuable form of promotion. Teaching is leading and everyone wants to work with a leader. Help your clients understand how complex the law can be. Give them a peek behind the curtain at what you do. Let them see that the average lawyer is mystified and baffled when he is confronted with the things you face each and every day.
There is an old parable that says:
“Give a man a fish and you feed him for a day; Teach a man to fish and you feed him for a lifetime.”
I have an addition to that. My addition is:
“Teach a man to fish and he will return to learn how to cook.”
The position you occupy in the minds of your clients and prospective clients is entirely up to you. You can take control of it or you can throw yourself on the mercy of the market. You future is too important to leave in the hands of someone else. Take control of it today.
Your Book of Business Stinks
Do you think like a business leader or do you think like a lawyer?
I had coffee with four friends the other day. Each is in a different line of business and each of them market to a different type of clientele. They all had two things in common: 1) They all own service businesses and 2). They all started their businesses within the past three years, in the middle of the worst recession since the Great Depression.
You would think these guys would all be lamenting the demise of the economy. You would think they would all be preaching gloom and doom about the current political climate. You would think they would all be cutting costs to make up for the losses they experienced during the past couple of years. But that is simply not the case.
Each of these start-ups has grown by over $1million in annual revenue during the last two years. Two of the businesses sell to other businesses and the other two sell to consumers. They all spend about 20% of their annual revenue on marketing. They all have a strategic plan in place and they all use a value based approach to their pricing.
When I asked them what one thing was most responsible for their success, the answer was unanimous. It was their focus on creating clients for life. They all said they KNEW they would develop big businesses if they focused on relationships as well as dollars. They had solid plans and they made adjustments along the way but they built their businesses with this vision of success in mind.
Workers think about transactions. Sell this service, make this money. Move on to the next client. Sell that service, make that money. Move on to the next client. Repeat until the clients stop coming then complain about the economy or the government or your partner.
How does this impact you as a lawyer?
It should stimulate your thinking about the business aspects of your law firm. Too many lawyers think like workers and not like business owners.
Every time I hear a lawyer talk about a book of business I go nuts. You don’t have a book of business. The guy who gave you work last year may not give you work again this year. Your great book of business is nothing more than the sum of the transactions you have processed. If you have a book of business, so does the cashier at Target. I think this term, book of business, was made up by some legal recruiter to justify his existence.
When I talk to a lawyer about his law practice I want to know about his client lifetime value and the lifetime value of his referral sources. This means I want to know how much work he has received from his clients during the entire time he has been working with them and how much revenue he has received from his referral sources over the years. To figure this out I ask him to add up the work each of his clients have given him over the years and divide that dollar amount by the number of years in his relationship with that client. Then I ask him to do the same thing for his referral sources.
This means each client has a lifetime value number as does each referral source. If you add up all of your client lifetime value numbers and divide by your total number of clients you will get a client lifetime value number for your law firm. Follow that same formula for your referral sources. These two numbers are the value of each relationship. They are a true measure of your success as a business owner.
Your mission is to increase these average numbers each year. You can only do that by developing deep relationships.
Do not give me the excuse that you cannot have a high client lifetime value because of your practice area. That is crap. I know attorneys in every practice area (including criminal law and divorce law) who have cracked the code on client lifetime value. Put your client’s needs first and you will figure out how to help them over and over again.
What is the first step to building a more valuable law firm?
The first step is to focus on expanding your relationship with your current clients. This means you need to find out what they want, what they need and how they make decisions. Once you know those three things you must figure out a way to help them achieve their goals.
It really is that simple.
But most lawyers do not think this way. They only think about their book of business.
Legal Marketing and the Danger of Not Doing Your Homework
Few people worry about the facts anymore. Not just in legal marketing but in life. Case in point: Just the other day I was flabbergasted when I heard someone I respect say:
“I don’t understand what the big deal about this oil rig explosion is. There are thousands of them out there. One blows up and the media goes crazy.”
I guess my friend didn’t realize that enough oil was spewing from that hole in the sea floor to equal the Exxon Valdez disaster EVERY FOUR DAYS.
I am trying to make the point that most people leap to a conclusion without knowing the facts.
This is just as true in legal marketing as it is anywhere else. I see lawyers investing in billboards, bus stop benches and TV ads without giving any thought to how they will measure the success of those media.
They sign long term website contracts without doing any homework on exactly what they are purchasing. They take advice from people who claim to be experts without ever checking out their credentials.
Do a little homework. Take a little time and look into things before you give up the hard earned bucks. Legal marketing is an investment. As the commercial says, invest wisely.
Three Step Legal Marketing System
Although it is relatively easy to tell when a relationship ends, most people have a difficult time understanding when a relationship begins. Yet it is often the early stages of a relationship that are most critical. At the beginning of the relationship there is a heightened sensitivity to every interaction. Trust has not yet been established so there is an imaginary wall in place. To win this person over you will either have to go over that wall or convince them to take it down.
While this could be the description of the early stages of a friendship, it is not. This is the feeling your client has while he is looking for a lawyer. By the time he actually contacts you there is already a relationship developing. It began without your knowledge.
You can control how this relationship begins. You can also nurture that relationship along. And you can do this even before you meet the person who will, one day, work with you.
There are three tools that are so valuable and so underestimated that they have become a secret weapon for my clients. I have discussed them with you several times and made countless videos about them. But for some reason, most people fail to put them into practice.
I can’t speak to why someone may or may not want to do something. And I do not have the time or the space to re-present all the overwhelming case studies that prove my point. What I am going to do is list these three tools here, once again, specifically for you. Suffice it to say that these tools are, in some way, responsible for seventy percent of the new business most of my clients receive. That means they work.
Three tools that can skyrocket your new client acquisition:
A Blog
The word blog is short for weblog and it is simply a website that is updated regularly. I counsel my clients to start a blog and update it at least one time a week. Three times is better. You only need to write an article of about 300-500 words in length each time you update the blog.
Blogs provide great insight into how your mind works. Blogs can educate your clients. They can motivate them to take action and they can differentiate you from everyone else. They also are great for attracting traffic on the Internet.
A Weekly Email Update
Some people refer to this as an e-blast. Some people call it an e-newsletter. It is basically an email that contains excellent educational information.
Many attorneys think a weekly email is too frequent. This is crap. People who do not want to read what you are sending will unsubscribe. The others will either ignore the information or they will read it.
If one person reads your weekly email update you are ahead of the game. If nothing else, it keeps you present in the minds of people who can refer you new clients.
A Monthly Print Newsletter
Your newsletter is a combination of personal information and educational material. This is your opportunity to develop a relationship with your readers (past clients and prospective new clients). People are nosey. They want to know what is going on in your life. Feel free to tell them something interesting about you THE PERSON not you THE LAWYER.
The print newsletter is the single most valuable marketing tool you can employ in your law practice. It doesn’t matter if you practice in criminal defense or securities law. The newsletter works.
Most lawyers will continue to ignore this simple three media marketing plan. If you do, I hope you are competing with one of my clients. Right now someone is going to their mailbox to find an invitation to begin a relationship with a lawyer. It could be you, but it is not.
Law Firm Marketing and The Benefits of a Narrow Practice Niche
Trying to be everything to everyone is a recipe for failure. There are dozens of reasons to focus your law firm marketing efforts in a narrow law practice niche. Here are a four:
Perception of Expertise: Prospective clients will perceive you as a qualified expert if you focus your marketing resources on a specific area. Educating people in this area will help demonstrate your understanding and mastery of it. Clients want to work with experts. Use case studies from actual client cases in your law firm marketing. This will help demonstrate your expertise and it will affect your clients’ perception.
Experience: The client will trust the person who has done this work previously. The patient who needs heart surgery wants to hire the doctor who specializes in this procedure. He doesn’t want the obstetrician who dabbles in this work on a part time basis. In your law firm marketing you should reflect back upon the number of matters you have handled in a particular area. Highlight your successful track record and your length of service.
Client Confidence: This goes hand-in-hand with experience. Your clients will have greater confidence in you if they know you have dedicated your practice to their area of need. The will believe in your ability to help them and they will trust your advice. Nothing boosts client confidence like testimonials. Once a client has called and asked for information about your law firm, ask them if they would like to “check your references”. This is an opportunity to pass along any testimonial letters you have received. Testimonials boost client confidence.
Competitive Advantage: A focus on a specific area of the law is a competitive advantage. While all other lawyers are touting that they can be everything to everyone you can point to your dedication and focus as a way to separate yourself from the crowd. This will allow you to win many more clients than your competition.
Focusing your law firm marketing in a narrow niche will help you attract more clients, gain their confidence and respect quicker and it gives you a competitive advantage. Start thinking of a way you can narrow your marketing focus and you will notice the difference in the clients you attract.
Law Firm Marketing and Clarity
What exactly do you want from your law firm marketing? Do you want more clients? Do you want better clients? Do you want a certain type of client? Marketing can help with all of these challenges but there is one thing that stands in the way. You.
If you do not know what you want, you will jump from opportunity to opportunity.
Law firm marketing is a means to an end but the end must be clearly defined.
Most attorneys use their law firm as a tool to help them make a living. These folks have basically purchased a job. They have no equity built up in their law firm since they move from one client to the next. This is the reason a focus on client lifetime value is so important. If you can handle multiple matters for each client, you can spend a significant amount of money to develop that relationship.
Every good strategic plan should begin with the question:
“What should this law firm look like when it is time for me to exit?”
You must have clarity on this key point before you begin to develop a law firm marketing plan.
Welcome Adversity
How do you know how strong you really are?
This is an odd question, I know, but the answer is incredibly valuable.
I work with many lawyers who are tough people. They are ruthless negotiators. They are aggressive defenders of the United States Constitution. They are tenacious advocates for their clients. They will race you to the courthouse, kick your ass in the parking lot, crush you in front of the judge and take your kid’s favorite toy just to make sure you think twice about coming back. When fear goes to sleep at night, it looks under the bed for these lawyers.
But the minute these incredibly tough people face some small sense of adversity within their law practice or their lives, everything comes unglued.
Take the case of a guy we will call Bill. He is a pit bull litigator who works with wealthy clients in Palm Beach County, Florida. He eats other attorneys for breakfast and lunch and takes on public officials for dinner. Bill is intense, high strung and determined to win everything from a pie eating contest to cases before the Florida Supreme Court.
Yet a couple of months ago Bill’s entire law practice fell apart. He began missing deadlines. The attorneys who work for him stopped send out monthly invoices to their clients. Some of them had forgotten to keep track of exactly what work they were doing (which makes billing even more difficult). The phone went to voicemail at all hours of the day and the mail piled up on the reception desk. In short, Bill’s law firm was a shambles.
What was the cause of this mess?
Bill’s administrative assistant quit about 90 days ago. Even though Bill can destroy an adversary in the courtroom he is no match for adversity in his law firm. In talking to people who know him, I learned that this has been Bill’s downfall throughout his entire career. The administrative assistant quits and he falls behind for six months. He goes through a nasty divorce and it takes him two years to recover. His car is stolen and he loses a month of valuable work time trying to figure out what to do. The slightest amount of adversity in this man’s life brings everything to a screeching halt.
While this is certainly an extreme example it provides us with an important lesson. As a law firm owner, you are a business owner. The hallmark of a successful business owner is not how he handles himself and his business when things run smoothly; it is how he handles the fifteen catastrophes he faces before he has his lunch.
Things happen. Sometimes bad things happen. Sometimes lots of bad things happen at the same time. You have to be able to deal with it.
What is the secret to handling adversity?
There are two key components to handling adversity.
The first component is attitude. You must accept the fact that things will go wrong in business and in life. You can plot, plan and pray all you want but stuff is going to happen. Your job is to deal with it, learn from it, and prevent it from happening again in the future (if possible). Accept this reality and take care of the situation as quickly and as effectively as possible. Then put it behind you.
The second component is a support system. Even tough guys have people they turn to when things get crappy. You need people in your life who will listen to you, offer you a reality check and sometimes just be a shoulder to cry upon. The only substitute for this is a nervous breakdown.
What can you do right now?
The action items for you on this topic are simple.
First: Identify the people in your work and in your life who are strong. Find people who have been through tough situations and survived or even thrived afterward. Treasure your relationships with these folks because they are the people you call upon in tough times.
Next: Adjust your attitude. Convince yourself that you can handle adversity. Think back to some of the worst times in your life and think about how you have moved on from them and become a better person because you faced them. Remind yourself that you have the willpower and resources to handle anything life throws at you.
Once you are fortified with your army of supporters and your defiant attitude you can welcome adversity into your business and your life. Once it gets there, kick its ass so it thinks twice about coming back.
Attorney Marketing and Client Selection
Sometimes attorney marketing helps you decide which clients NOT to work with.
The most difficult decision for any attorney is one that involves turning away business. There are times with the client in front of you has enough money to work with you, has a problem you can solve and is ready to get started but you just can’t work with them.
How could this ever happen?
Here are three reasons to turn away a client:
Lack of Integrity
Clients lie to their attorneys all the time but this doesn’t mean you have to tolerate it. If someone comes to you with a matter and their initial story sounds “fishy”, walk away. Your gut instinct is always right. You do not need the headache of guessing which lie will take down the whole case.
Use your marketing as a tool to screen your clients. Have a member of your team conduct a thorough interview with the prospective client before agreeing to the initial meeting. Use the results of this interview to inform your initial consultation. Look for inconsistencies. If you find any, decline the case.
Lack of Engagement
Some clients will ask you to “just handle it” when it comes to their matter. The extent of their involvement ends when they sign the check to pay your fee. Unfortunately these clients usually become re-engaged right about the time the whole case blows up. That’s when they file the bar complaint.
In your pre-meeting packet (you should send your clients something before the initial consultation) stress the importance of the attorney-client relationship. Highlight it as a partnership designed to achieve the optimal result. Clearly spell out the consequences of a lack of client participation.
Lack of Decisiveness
Clients who are irresolute will kill you. They will waste your time and drain your resources. An indecisive client will take a victory and turn it into a defeat. Run away from clients who have difficulty in making decisions.
Many attorneys think it will be difficult to spot these people. It is easier than you think. In your screening interview ask questions about major decisions they have made in the past. Ask about things like home purchases, auto purchases and selecting other professional service providers. Finally, ask the prospective client how many lawyers they met with before they came to see you. If they have visited with more than one attorney prior to seeing you, decline the matter.
Attorney marketing is sometimes about the cases you do not take. Making wise decisions in client selection will save you money, it will save time and most importantly, it will save your sanity.
The Truth About Search Engine Marketing for Law Firms
Many of the self appointed watchdogs of law firm marketing have been screaming, yelling and jumping up and down about search engine marketing and its use by law firms. The issue many folks have with search engine marketing centers around the use of services that provide links to your website from related sites.
Search engines view inbound links as a measure of a website’s importance and relevance. These services (based primarily in India and the Philippines) control hundreds of sites with legal content and, for a fee, they will link back to your law firm website from those sites. Over time, these links will help boost your search engine ranking.
Search engine algorithms place a high value on inbound links because they should determine relevance and credibility. If someone likes your content and they link to it, this should indicate that it is valuable. Unfortunately, link building (paying for links) has become so prevalent that it is almost impossible to compete without purchasing links in one form or another. While good content may receive 20 or 30 “true” links over a one year time period, a link building service can generate that many links to your website in less than a month.
Search engines have added some safeguards to try and detect and ban sites that use these services. Google has been known to demote sites that add too many links quickly (using speed as a measure of suspicious activity). In addition, several links from the same site will devalue the power of those links in the algorithmic formula). These measures, while minimally effective will still make it difficult for individual websites to compete with those who subscribe to link building services.
Is it worth it?
Should you use a link building service to help with search engine marketing? There is no easy answer to this question. Link building will certainly help your website place better in search engine ranking but if you do not know how to leverage that traffic or how to qualify those inquiries, you may be wasting valuable resources. In addition, these services can often take one year or longer to have any significant impact on your website’s position.
You are better off using the money you would spend on link building to help you deepen your relationships within your community. Take a few hundred dollars each month and host a breakfast at your office for some of your key referral sources. Build your true local relationships and you will get at least as many good referrals as you would from the additional Internet traffic.
Search engine marketing is important. You can influence you position in the rankings by writing good content on your blog frequently. While this will be a slow process and you probably won’t be number one in the search engine ranking game, but you also won’t have any concerns about a change in algorithm or being banned for building links. And your budget won’t take a hit as a result of investing in something that may never pay off.
