Article originally published in the Quarterly V12-I2, 2018. Author: Patrick Carlson, JD, LLM. Get all your business and estate planning information by becoming a Quarterly subscriber.
Sadly, many attorneys do not approach their client development efforts with an eye towards creating lifetime value. When you transition your mindset, it can have far-reaching – and valuable – implications for how to approach your marketing efforts, initial intake, client service, and the cultivation of additional legal service opportunities with those clients.
Many attorneys with a transaction-only focus experience a boom-bust cycle in their practice. The boom part of the cycle happens after an effective marketing campaign. Many matters come into the office and are being worked on, so the attorney slows down on the marketing and client development. This slowdown in marketing naturally happens because there is not enough time to do everything. Eventually, the client work dries up, and a bust occurs. Suddenly, there are too few cases, cash flow is tight, and the attorney is on edge about getting additional clients. Then the process usually repeats as another marketing push leads to the next boom, inevitably followed by another bust.
Consider Lifetime Value
When marketing is designed to bring lifetime clients into your practice, the predictability of revenue and operations increases. When you consider the value of lifetime clients, you become able to invest appropriately in building your client relationships. Proper execution and implementation is important, but arming your client development efforts with sufficient resources is the other critical key to success.
Stepping away from legal services, I have gone back to Amazon repeatedly because they have the products I need, and they offer a buffet of valuable benefits in the form of Amazon Prime. In a professional services environment, it works a little differently, but the concepts are similar.
Consider Susan and Jim, a married couple. Jim operates a small contracting business. Susan currently stays at home with their preschool-aged children but she is considering opening a flexible, work-from-home business as a freelance writer.
Think Like an Enhanced Search Bar
Likely, you can readily spot opportunities and needs for legal services even from those limited facts. Work with Susan and Jim to explore their specific needs by learning more about their goals and desired outcomes. Virtually every estate planner has heard a prospect say, “I need a will,” or “I need a simple LLC,” when in fact they needed something different or more complicated. This is why I call this an enhanced search bar. Susan and Jim are sharing what they want. But you must elevate the relationship by genuinely listening to the clients and understanding what their needs are. As you explore a clients’ needs, use your professional judgment to educate, provide course corrections, and probe deeper where necessary. But otherwise, let your clients run the search.
Think Like an Algorithm
Amazon does not promote a bunch of random stuff that is unrelated to your expressed needs. Instead, Amazon’s algorithm places things in front of you that it determines you need based on the information you have supplied, say from your search terms, search history, wish list, etc.
The critical value we bring as attorneys is the professional judgment to assist clients in prioritizing their needs while also recommending and implementing legal solutions to achieve their goals. For example, Susan and Jim may have set up a meeting to discuss their concerns about how to best start Susan’s work from home business. However, you would be remiss if you did not discuss the issue of protecting Jim’s contracting business from lawsuits and other possible risks. With preschool-aged children, the issue of proper estate planning, including the nomination of guardian for minor children, also readily presents itself. Of course, if they are only interested in Susan’s fledgling business, then you will get the best results by respecting that choice and delivering whatever services are agreed to. So, what do you do with the other issues you’ve identified?
Maintain a Wish List
When you are not ready to make a decision, a wish list on Amazon lets you postpone a purchase until you are. You can do something similar by maintaining an itemized inventory of other client needs that are identified during your work with the client. Have the client help you prioritize and maintain this list. This sets an expectation and reminds your client that there is more to do later. Since the client is prioritizing (with your guidance and input), you are always – or nearly always – working on the most pressing issue for the client. This helps to avoid disconnects or the perception of bad service. As a result, you can more easily win repeat business.
A summary with Susan and Jim may go like this:
“It sounds like getting Susan’s business set up properly is the most important issue right now. We’ll get started on that right away and should have everything done in less than a month. It appears there are two other issues that also need resolution. One, getting your estate plan together to name guardians for your children. And two, getting Jim’s LLC updated so his business is fully protected and optimized to save taxes. Is there anything I missed? Which of those is the most important to do next?”
The lifetime value of the client will be enhanced by approaching the relationship with your clients this way. Client service will also improve because you will be consistently focusing on the client’s goals rather than substituting them for your own ideas of what is important.
The Ongoing Value of Amazon Prime
Amazon Prime offers its subscribers many benefits, including most notably the free 2-day shipping on many items. For Amazon, the biggest benefit of offering Prime appears to be that Prime subscribers spend vastly more than non-Prime subscribers.
In estate planning, one significant challenge is encouraging former clients to update or rework obsolete plans. A client care program – essentially a subscription for a bundle of legal services – can be a significant enhancement for your business and for the value you provide clients. You can use your client care program to deliver value to clients through client events and continued education while also staying top of mind to encourage them to move forward with items from their wish list.
Working on your law business is an exciting and invigorating challenge. I encourage you to find inspiration everywhere and always focus on honing your craft.