Solicitors Marketing Budgets

How Do You Set Your Law Firm Marketing Budget?

When it comes to setting a marketing budget for solicitors, I understand that many solicitors do not know where to start. Whilst a very basic method is to take 5% of turnover as a starting point, this could lead you to missing out on a huge opportunity to make substantial profits.

The Reason Using 5% Could Be Costing You Thousands

It is best to remove ourselves from the legal world to look at this more objectively. Imagine you were guaranteed that if you spent £100 with your bookmaker, you would receive £150 in return, within one month. How many £100 would you give to your bookmaker? Surely the only answer is as much as you could possibly lay your hands on.

Moving back to the legal marketing world, if you are able to accurately show that for every £100 you spend on one marketing method you receive a return on investment of £150 in legal fees, how much would you spend? I accept that this is not a completely straightforward analogy, but it does prove or over-prove a point. That is, if you know how much each £ of marketing spend produces in fees, it makes it much easier to spend more and more on marketing. All big businesses understand this, but I meet many solicitors that struggle to grasp the concept.

However, there is one area where it is very accurately understood and that is the field of personal injury law. Solicitors will pay from £200 to £600+ for a personal injury case because they know that they are receiving a new instruction and it will generate a guaranteed minimum return in fees of at least £600 profit but usually more.

The inherent problem with this type of marketing (referral fee marketing that is) in that it is not building a future pipeline of leads for your practice. Once the client has been processed they are normally lost to the original provider of the instruction. It is much better to spend the money on your own initiatives, whether they are website marketing, print advertising or marketing your own client database. If you can spend the £100 on your own marketing initiatives, you have the opportunity to generate future instructions from the same client. The initial £ can be turned into an initial £160 will instruction, followed by a £1,000 employment instruction and a £3,000 personal injury instruction a few years later. The £100 initial spend has now created over £4,000 in fees for your practice.

The vital point to grasp with all marketing is that you must record how much you spend on every aspect of your marketing (figure 1), and how much that generates in fees (figure 2). If figure 2 beats figure 1 by a good percentage, then you have to carry on increasing the spend as long as it continues to provide you with a return.

Record, record, record…

The vital two parts of this message I hope have been clearly received, however to clarify they are:

  • Record how much of a return on investment you receive for each aspect of your marketing
  • If your marketing is working, do not limit yourself by budget, spend more to make more profits.

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Law Firm Marketing

Case Study

Now I’ve got eight staff and two offices, and we’ve never been busier.

I’ve been working with Nick for the last six years, and in that time he’s had a significant impact on my business.

We first start working together when I worked at an employment law practice, and when I left there to set up on my own, Nick was one of the first people I called.

I knew that one of the key pieces to get right was the website – in this day and age it’s impossible to run a successful firm without one – and with Nick’s advice, help and guidance, we created our own marketing-focused site that has proven to be the backbone of all the sales and marketing that has followed.

But a good website means nothing unless people see it, and that’s why we turned to Nick to run our Google Adwords, which quickly became a primary source of leads.

In addition to running the traffic, Nick held our hand through every element of the client attraction process, from how to communicate with leads, to how to close sales, and the impact that had on our business cannot be understated.

And that’s why I will always recommend Nick to anyone who needs help with marketing – particularly legal firms: his breadth of knowledge about everything to do with sales and marketing means that he can (and does) help with every part of the picture, resulting in a stronger business than you could have imagined.

Since we’ve been working with Nick, we’ve grown quickly – back in 2013 it was just myself and my wife, and she was part-time.

Now I’ve got eight staff and two offices, and we’ve never been busier.

And if our lead numbers are anything to go by, it’s only going to get better – 2015-2016 saw us get 800 good quality leads in employment law, and that figure more than doubled last year. I can only look forward to more exciting times, working hand-in-hand with Nick to grow my practice and enjoy the fruits that come with that growth.

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