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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