The easiest way to increase law firm profits

July 12, 2012 by
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In medicine, The Hippocratic Oath includes the Latin phrase, Primum non nocere, meaning, “First, do no harm.” Attorneys need a similar pledge, not just to protect our clients, but to protect our bottom line.

According to a study from The George Washington University (ppt–not worth downloading, IMHO), the cost of a dissatisfied customer is staggering:

  • The average business does not hear from 96% of unhappy customers
  • For every complaint received, there are 24 people with unvoiced problems; six are serious
  • 90% who are dissatisfied with the service won’t return
  • The average customer with a complaint will tell 9-10 people; 13% will tell more than 20 people

Other studies confirm numbers like these. The bottom line: losing one client could cost you a lot more than you earn from one new client.

Therefore, the easiest (and smartest) way to increase your profits is to stop losing clients.

There is some good news from the study:

  • Of those who complain, 50-70% will do business with you again if the complaint is resolved. 95% will return if it is resolved quickly

Therefore, you must encourage your clients to let you know when they aren’t happy so you can fix the problem quickly and can take steps to make sure the problem won’t occur with other clients.

Remember, most unhappy clients don’t complain. They just leave–and tell others that you are a Bozo.

Here’s how you can solicit this extremely valuable feedback from your clients:

  • Include feedback forms in your “New Client Kit”
  • Post surveys on your web site
  • Tell clients (repeatedly) that if they ever have an issue of any kind, you want them to call you personally (and give them your cell phone number or direct line)
  • Put a “Suggestion Box” link on your web site. Allow people to contribute (or complain) anonymously. Promote this box via your newsletter and blog
  • Put stories in your newsletter about suggestions you received and implemented.
  • Interview clients at the end of the case. Ask them, (1) What did we do well? and (2) What could we do better?
  • Thank everyone for their ideas and feedback, publicly if possible

In other words, if you want feedback, create an environment where feedback is encouraged, appreciated, and most of all, acted upon.

Often, perhaps most of the time, unhappy clients aren’t unhappy because the attorney did something wrong, they are unhappy because of poor communication:

  • Something wasn’t explained properly.
  • The attorney didn’t keep the client informed.
  • The client’s phone calls weren’t returned.

If you ever drop the ball in any of these areas, don’t worry, these are easy to fix. If any of your clients were unhappy with their previous attorney for any of these reasons, celebrate. This is a tremendous opportunity for you to convert them into raving fans.

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Filed Under: Client loyalty, Client relations, Communication, Increase your income, Law office management Tagged With: , , , , , , , , , , ,

Take inventory of your marketing to save time, save money, and improve results

July 11, 2012 by
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Taking inventory of your marketing can help you gain clarity about where you are and make it easier to get to where you want to go.

Here’s how to do it:

Pick a period of time in the past. Six or 12 months will do. Write down how many new clients you took in during that period, who they are, and the amount of income those clients have or will generate for you.

So far, so good.

Next, look at the names of each of those new clients and write down where they came from. You need to know whether they were referrals (including self-referrals, aka repeat clients), or they came from some other source.

You can break this down any way that makes sense for your practice, but I suggest something like the following:

  1. Referrals from clients (including self-referrals)
  2. Referrals from professionals, others; networking
  3. Online (Blogging, SEO, social media, webinars, articles, etc.)
  4. Paid advertising (PPC, direct mail, display, radio, directory, ezine, banners, self-hosted seminars, etc.; if you do a lot of adverting, you should break this up into different categories)
  5. Other (Public speaking, publicity, writing (i.e., trade pubs), etc.)

Okay, now you know where the business is coming from. What now?

Here are my thoughts on how you can use this information:

  • Most of your clients should come from referrals. If they don’t, ask yourself why and what you can do about it
  • If you’re not getting business from some of your marketing activities, or they are too expensive relative to the business they bring you, consider eliminating those activities.  For example, if blogging and social media take up a lot of your time but you’re not getting the clients from it, why do it? Use that time for something that is producing.
  • There will be some cross-over or ambiguities. For example, blogging may not be producing a lot of traffic, inquiries, and new clients for you but it still has value as authoritative content you can show to prospects who come to you via referrals, or to add value for your clients.
  • If something is working for you, do more of it. You can find more time for networking, for example, by reducing or eliminating some or all of the time you spend on (whatever is not working). If advertising in trade publications regularly brings in new clients, increase your media buys in trade publications.
  • Before you cut anything, consider the “back end”. For example, you may be breaking even on advertising (or even losing money) but if you are able to get referrals from the new clients that are produced by that advertising, you’re still earning a profit.
  • If you aren’t in the habit of recording where your clients come from, you need to start. Instruct whoever answers the phone to ask everyone, “Where did you hear about us?” and add a line to your new client intake form.
  • Track these numbers going forward so that you can periodically take inventory and see where you are.

A friend of mine says, “You have to inspect what you expect”. He also says, “You have to slow down to speed up.” Take his advice. Once or twice a year, shut off the phones and email and take inventory. It will help you save time, save money, and improve your results.

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Filed Under: Advertising, Blogging, Increase your income, Law office management, Leverage, Marketing legal services, Networking, Productivity, Public Speaking, Referrals, Social media marketing, Time Management Tagged With: , , ,

New law practice: How do I get the word out?

July 2, 2012 by
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I got an email last week: “Do you have suggestions for getting the word out on new (solo) law firms”

Q: Press releases to big city newspapers?

Unless your announcement qualifies as news, these are unlikely to get printed. If you are semi-famous or you’re planning to do something very unusual in your law practice, a press release might get picked up. Otherwise, probably not.

If you want to go this route, your best bet is to send them to niche publications: small town newspapers (where you grew up or your dad was well known), blogs or magazines in a market where you have a connection, that sort of thing.

Q: Mailing announcements to the Bar list (of business attorneys) and/or business owners?

Announcements mailed to other lawyers or business owners are a waste of time. They don’t know you and they don’t care that you’re opening your own office.

You could mail something they would care about: a free report that helps them protect themselves or their clients or earn more in their business or practice. A postcard that offers a report like that, and sends them to your web site to get it, would cost a lot less than actually mailing the report. It could bring lots of traffic, opt-ins, and eventually, some business. However, even post cards are expensive and you need to know what you’re doing.

This can be a viable way get clients, but for a new practice with limited funds, it’s not the best place to start.

Q: Hiring a service to send email announcements to the Bar list and to our own contact list?

Emailing to people you don’t know (i.e., Bar list) could get you into trouble for spamming. There are legitimate “opt in” lists available where people have given permission to receive email, and there are services that will provide these lists and do the emailing for you, but you would be wasting your time and your money.

Again, they don’t know you and they don’t care about your announcement.

However, emailing or sending announcements via regular mail to your own contact list is a great idea.

You should definitely send an announcement to the people you know. Friends, family, people you know from college and law school, and former employers. If you have a connection of any kind, put them on your list.

They do care about you and what you are doing. They will read your announcement. They may respond and wish you the best of luck. At some point, they may also send some business.

Here are my three “rules” for announcing a new law practice:

  1. Send your announcement to everyone you know; don’t bother with strangers, unless you have a very good reason to do so and the budget to pay for it.
  2. An announcement is okay; a letter is much better. Write a semi-personal letter that gives the who, what, where, when, and why of your announcement. Why are opening your own office? What do you want to accomplish? Who are you looking to help? What will you do for them? People will look at an engraved announcement for three seconds and then throw it out. Those same people will take their time reading a heart-felt letter on plain paper or in an email. They will remember your story and may even share it with others.
  3. Don’t rely on a one-time mailing. Follow up your announcement with additional communication–a newsletter, calls, invitations to your grand opening, personal visits. Stay in touch with them, remind them again and again about what you do and for whom you do it, and ask for their help.

Even if there are only 100 people on your initial list, these are the people to whom you should announce your new practice. They do know you and they are willing to help.

They may not be able to send you any business (right now), but they can help promote your web site, like your page, or distribute your new report. They can help you get the word out.

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Filed Under: Communication, Law office management, List building, Marketing legal services, Marketing Plan, Press release, Publicity, Relationship marketing Tagged With: , , , , , , , , , , , , , , , , , , ,

Would you ever sue your own client for fees owed?

June 21, 2012 by
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I was asked that in an email this morning and it’s a great question. How would you answer it?

I never sued a client for fees. I don’t think I would, but “would you ever?” covers a lot of territory. I suppose it’s possible. But unlikely, at least for me. Bad Karma. Better to focus on getting new clients and especially, better paying clients.

If I considered it, I would think about things like

  • How much was owed and for how long
  • Who the client is (corporate or individual, long-time client or first time client)
  • Why aren’t they paying? Are they dissatisfied with something? Having financial difficulties?
  • What is their attitude? Contrite? Jerk? Are they ignoring me or willing to talk about it?
  • Are they willing to pay anything?
  • Could I collect if I won?

I’d also think about what I might lose if I did sue. Maybe if I cut them some slack they would pay me when they could. Maybe they’ll feel guilty and send some referrals. And maybe they will solve their immediate cash flow problem and become long-time, good paying clients.

One thing is sure, if you ever do sue a client, you can be pretty sure they will never hire you again (although it does happen) or send you any referrals.

Of course the best thing to do is avoid getting into this position. Get paid in advance or at least get big retainers, auto-bill their credit card, and never let the balance get too big (i.e., bill monthly).

At the end of the day, there will always be uncollected fees. As long as it’s a small percentage of gross receipts, I consider it an acceptable cost of doing business. If it’s not a small percentage, I know I’m doing something wrong.

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Filed Under: Attorneys fees, Fees and Billing, Law office management Tagged With: , , , , , , , , , ,

Why you should consider increasing your legal fees

June 18, 2012 by
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Times are tough. Clients are having trouble paying their attorneys. And that’s exactly why you should consider increasing your fees.

When times are tough for your clients, you also feel the pinch. But your overhead keeps increasing, doesn’t it? At some point, some of the services you offer will no longer be profitable. “We lose money on every client but we make it up in volume,” is an old joke. But some attorneys don’t understand, the joke is on them.

What would happen if you raised the price on those services? You may lose a percentage of your clients, but the increased revenue from your remaining clients would provide a profit on every “sale”. And if you lose more clients than you expect, you will have more time to do more (higher paying) work for other clients.

True, you may not have other clients to fill the gap right now, but you will have more free time for marketing so you can bring in new clients, something you may not have time to do right now.

And you may find that you don’t lose many clients when you increase fees. Prices for everything are going up these days, so to some extent, your clients expect you to follow suit.

When an airplane loses cabin pressure we’re told to put the oxygen mask on our mouth first. Once we’re out of trouble, we can help the people next to us. It’s the same thing in a law practice. If your practice is in trouble, you won’t be around long to help your clients with their troubles.

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Filed Under: Attorneys fees, Fees and Billing, Increase your income, Law office management Tagged With: ,

How to get prospective clients to see you as the ONLY attorney to choose

June 11, 2012 by
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Imagine you are looking for a new accountant. You’ve collected information about several candidates, but you haven’t spoken to any. You’ve narrowed your list to three accountants you plan to contact.

You call the office of the first accountant and tell the receptionist you want to talk to Mr. Roberts about possibly hiring him. You are told that you will need an appointment and you set one up for the following week.

You have a similar conversation with the second accountant’s office, but in this case, you are transferred immediately to Mr. Green. He tells you about his background and practice. He’s friendly and open and you schedule an appointment to meet with him as well.

You call the third accountant, Mr. Jones, and are transferred to his personal assistant, Sally. She asks you some questions and also sets up an appointment with Mr. Jones.

So far so good. Three decent candidates. You’ll meet all three in person within the next ten days and you hope you can choose the right one. You start making a list of questions you will ask when you meet.

You check your email. There’s a message from Sally, Mr. Jones’ personal assistant, thanking you for your call and confirming your appointment. Attached are some documents for you to review before you meet:

  • A letter confirming your appointment, directions, and parking instructions.
  • A F.A.Q. brochure about Mr. Jones, his firm and staff, fees, payment options and other basics a prospective client would want to know
  • Three articles by Mr. Jones, one about saving time and money with bookkeeping, one on how to minimize taxes, and one published in a bar journal about tax issues lawyers need to know that will help with do a better job for their business clients.
  • Another article, an interview of Mr. Jones that was published by a prominent CPA Journal
  • Three back issues of Mr. Jones’ newsletter
  • A booklet of testimonials from Mr. Jones’ clients, including several attorneys, and endorsements from other CPAs, financial planners, and a professor of taxation
  • Mr. Jones’ CV listing his education, experience, awards and honors
  • A two-page questionnaire to be filled out in preparation for your appointment, about your practice and your tax and accounting needs

Every page includes links to Mr. Jones’ web site. There you find additional information, articles, blog posts, white papers, and back issues of his newsletter. There is also a link to subscribe to his ezine via email and links to connect with him on social media. You follow several links and see he is connected to many attorneys, including many whose names you recognize.

The next day, you get an email from Mr. Jones himself. He says he’s looking forward to meeting you the following week, encourages you to fill out the questionnaire, and says he has already visited your web site to get some preliminary information about your practice.

Mr. Jones invites you to send him additional information about your practice that you would like him to see, and any questions you would like him to address.

The next day, in the postal mail, a hand written note arrives, signed by Mr. Jones. It says, simply, “I’m looking forward to meeting you next Wednesday.”

Over the next few days, you get two more emails from Mr. Jones.

The first is an article written by one of his other clients, a lawyer who practices in the same field as you. The email says something nice about this lawyer and Mr. Jones says he thought you might like to read the article, that a lot of his clients have found it helpful.

The second email contains a checklist Mr. Jones gives to all of his clients and a report that shows how to use it to save time and better prepare for tax time. The email invites you to contact Mr. Jones if you have any questions. The email is signed “Bob”.

Next week rolls around and two days before your appointment, you get an email reminding you of the appointment and asking you to either send your questionnaire in advance or to bring it with you.

The next day, the day before the appointment, Mr. Jones’ assistant calls you with a courtesy reminder. She asks if you have any questions, reminds you that they have free parking, and says she and Mr. Jones are looking forward to seeing you.

You haven’t even met Mr. Jones but you already know: he’s the one. You will probably meet with the others, just to be sure, but unless Mr. Jones has two heads and a forked tongue (and maybe even if does), he will be your new accountant.

What can be learned about this experience?

  • Mr. Jones used a “shock and awe” campaign to overwhelm you with reasons for choosing him over any other accountant. Even if you never read the documents he sent you, you are impressed by his diligence and thoughtfulness and convinced he has the requisite experience.
  • The personal touches he adds to the process made you feel good about him. He treats you like a client before you became one. He shows you respect, like you are a valued individual, not a name on a file folder.
  • He provides social proof (articles, testimonials, endorsements) of his experience with and commitment to attorneys as a niche market for his practice. He makes you believe he understands what you do. He shows you that he has helped others like you, suggesting that he can do the same for you.
  • He uses content (articles, blog posts, etc.) to do the heavy lifting. It proves he is good at what he did, without him having to say so himself.
  • It doesn’t take a lot of time to do what he does because almost everything is written in advance and he and his staff obviously use a checklist to manage most of the process.
  • He doesn’t do anything you couldn’t do. You may not have all of the documents he has, but you can start with what you do have and add more later.

I’m sure you can imagine what Mr. Jones will do when you arrive at his office, during the appointment, and after the appointment. Marketing is actually very simple: Treat people like you would like to be treated.

Take some time to outline the process for communicating with a prospective client for your practice. What can you do to show them what they need to see and hear so that they fall in love with you?

Done right, they will “know, like, and trust” you before they even meet you. You won’t just be the best choice, you’ll be the only choice.

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Filed Under: Client relations, Closing the sale, Communication, Law office management, Marketing legal services, Marketing Plan, Social media, Specializing Tagged With: , , , , , , , , , , , , , , , , , , ,

The most important person in your law office

June 8, 2012 by
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The most important person in your law office is the person who answers the phone. What they do, or don’t do, is critical to your success.

That’s not an exaggeration. Your “receptionist” can be a major factor in the growth of your practice, or they can destroy it.

When a prospective client calls your office for the first time, they don’t know what to expect. Their legal situation is weighing on their minds and if they’ve never talked to an attorney, they’re probably nervous. They’re looking for solutions, sometimes desperately, and they want someone to comfort them and tell them everything will be okay.

How well does your receptionist do his or her job?

Have a friend call your office and pose as a prospective new client. You listen in. How are they treated? You may be surprised by what you hear.

I’ve talked to some excellent receptionists and I’ve talked to some awful ones. I can tell with surprising accuracy how successful the attorney is, or will be, within a minute or two of calling their office.

A professional receptionist will make the caller feel important. They listen carefully, ask appropriate questions, and explain what the caller needs to know. They don’t talk “at” people, they talk to them. They care about helping people, and it shows.

What are you paying the person who answers your phone? You should either fire them or give them a big raise. They are either making you a lot of money or costing you dearly.

What’s that? You don’t have a receptionist, you answer your own phone? Record yourself answering a few calls and then listen to those recordings. You may be surprised by what you hear.

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Filed Under: Client relations, Communication, Law office management Tagged With: , , , , , ,

How many lawyers really work from home?

June 4, 2012 by
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According to the latest US Census, 2% of lawyers now telecommute. That’s up 166% in the last ten years and it’s one of the fastest growing categories. But it’s still a small number.

I’m guessing that most of these lawyers don’t see clients. They write, research, and perform other functions that don’t regularly require meeting people in person.

I’m also guessing that if The Census had used a different word than “telecommute,” the results would have been different. I think a lot of attorneys do at least some of their work from home. They don’t call it telecommuting, however, a word that is not usually associated with professionals.

I also think a growing number attorneys, sole practitioners primarily, work almost exclusively from home. They see clients at an office suite where they have so many hours a month available for that purpose, or other arrangements, i.e., using a conference room or spare office in another attorneys suite.

I work from home. When I “see” a client (lawyer), it’s done over the phone. My overhead is a fraction of what it was when I had an office and I love not having to commute. If I was practicing today, however, I would still have an office.

For one thing, I got a lot of walk-in clients in my practice. Existing clients would bring their papers to the office when it was convenient for them and if they needed help with those papers, someone needed to be there to provide that help.

In addition, my clients needed to see me in person, even if it was only greeting them before turning them over to a member of my staff. They needed to see me wearing the uniform (suit and tie) and to see that I was successful (i.e., nice furniture, etc.) Most of all, they needed to see that I was physically present, committed to the community and niche market that I served.

Over the years, I’ve talked to attorneys who have an office in their home and see clients there. I think this is a mistake. Clients have expectations about what an attorney does and they expect attorneys to have an office. When you deviate from what they expect, they get nervous. They may not say anything but they are surely wondering why you can’t afford a real office.

Without an office, it’s more difficult to attract clients. There are exceptions–entertainment law, for example, where working from (an expensive) home may actually provide even better posture. But for most attorneys, not having an office, in my opinion, costs more in terms of lost business and referrals than the amount saved by working from home.

I would probably have a smaller office today, however. You don’t need as much space today because a lot of work attorneys need done can be outsourced to virtual assistants or employees who work from home. I talked to a secretary for a California attorney recently. If she hadn’t told me, I would never had known she lives in Florida and works from home.

How about you? Do you do some or all of your work from home? Do you have a smaller office than you had in prior years? Let me know in the comments.

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Filed Under: Law office management, Legal industry, Marketing legal services Tagged With: , , , , , , , , , , , , , , , , , , ,

Could you charge more for your legal services? Here’s how to find out

May 24, 2012 by
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Could you charge higher fees for your legal services than you charge right now?

What if you could get paid one-third more than you now get without losing any business. Wouldn’t that be cool? Or, maybe you might lose some business but increase your net income because of the higher fees you are paid from everyone else. Also cool.

Most attorneys set their fees by looking at what other attorneys in their market charge. They don’t want to charge a lot more or a lot less so they play it safe. But some attorneys do ask for more and they get it.

True, these higher paid attorneys may have more experience or a higher-profile reputation. They might offer more value to their clients. Perhaps they are better “sales people” or have more chutzpah. Maybe they took a chance when quoting fees and got lucky.

The point is that some attorneys get paid more than other attorneys for doing essentially the same work. What if you could, too?

There is a way to find out if you could charge more. No, not by asking your clients or prospects if they would be willing to pay more. They have a certain, um, bias, don’t you think? No, if you want to find out if people are willing to pay more you have to charge more, and see if they pay it.

But hold on. Don’t raise your fees across the board just yet. That’s too risky. You don’t know if this will be successful. What if you ask for too much and lose too many clients? Not good. Conversely, what if you don’t ask for enough? Your clients may pay ten percent more without flinching, but how do you know they wouldn’t have paid twenty percent more?

The answer is to test higher fees with small groups of clients and/or prospects and measure the results.

Pay-per-click advertising is a great way to do “split testing”. Basically, you quote one fee to the first inquiry and a higher fee to the second. You alternate quotes until you have a meaningful sample of responses and clients. With enough responses, you’ll be able to see which fee is producing (a) the most clients, and (b) the highest income.

Pay-per-click advertising has become extremely expensive and you might not want to use it as an ongoing marketing tool. But for short term testing purposes, wouldn’t it be worth it to find out conclusively that you could safely charge a lot more than you do now?

If your practice isn’t amenable to advertising, there are other ways to test fees with smaller groups of prospects. If you do seminars, for example, you could quote every other attendee a different fee. Or quote different fees at every other seminar.

The results of price testing are often surprising. You would think that charging higher fees would decrease the number of sales (clients) but that is not always the case. Sometimes you sell just as many at the higher price. And sometimes, believe it or not, you sell more at the higher price.

But you’ll never know unless you test.

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Filed Under: Advertising, Attorneys fees, Increase your income, Law office management, Marketing legal services Tagged With: , , , , , , , , ,

Great advice on starting a new law practice (or growing your old one)

April 10, 2012 by
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Marketing legal services is simple. A lot of common sense, really. You don’t need a bunch of high tech solutions or a complicated process. What you need are people.

An article in today’s Forbes Magazine tells the story of a Los Angeles lawyer who started her own practice in the summer of 2010 and in less than two years built a successful estate planning practice.

In, How I Got My First Client and You Can Too, attorney Sonia Tatiyants outlines what she did to get her first client and beyond.

She didn’t advertise or build a powerful web site. She didn’t have the money to do that, even if she wanted to. What she did is decidedly low cost and low tech. She began by contacting everyone she knew to announce the opening of her new practice.

It doesn’t get simpler than that.

By the way, if you’re not new, find a reason to contact everyone in your database and remind them that you are still here. Someone on your list needs your services, or they know someone who does.

Tatiyants followed that up by starting a lunch group where she could network with other estate planning attorneys. She also networked with “like minded, driven, entrepreneurial individuals. . .,” who collaborated with her and became a source of referrals.

Taking things a step further, Tatiyants also realizes that her clients can not only send her referrals, they can become a source of business for the professionals in her network. In positioning herself as a “trusted advisor,” her clients and contacts look to her for referrals when they have a problem or need. She refers them to the other lawyers, CPAs, financial planners, and insurance agents in her network.

She also understands the importance of keeping her clients happy. One way she does that by making sure they know what to expect with their case. By managing their expectations, her clients don’t get frustrated with delays or when they get something in the mail.

Finally, she understands that for her practice to continue to grow she needs to put systems in place that will allow others to do administrative tasks so she can focus on the lawyering (and marketing).

Great marketing advice for new lawyers and old. Even lawyers who are very old.

But there’s something she left out of the article that I know every lawyer would like to know. How did she get featured in Forbes magazine?!

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Filed Under: Law office management, Marketing legal services, Marketing Plan Tagged With: , , , , , , , , , , , , , , , , , , ,
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