Jam today, jam tomorrow - marketing to prospects

By David Gilroy, sales and marketing director, Conscious Solutions

The ingredients for marketing success are generally universal among professional service firms, although here we will look at those activities that will enable a law firm to taste the delights of new clients and growth in the top and bottom line.

The prospect
What do I mean by a prospect? At the risk of stating the obvious it’s someone who expresses an interest in a product or service that you sell, but does not buy from you. In my mind these people are different than suspects who are those you target based on some kind of market segmentation strategy. Let’s look at the following scenario as a starting point.

Brrring Brrring. Brrring Brrring.
“Hello Gilroy & Gray Solicitors, Sarah speaking, how may I help you?”
“Hello, I’ve been given the name of your firm by a work colleague who tells me you are the best conveyancing firm in town. I’d like to speak to someone about your services”.
“Of course, I’ll put you through to David Bockham the head of the residential property department.”
Beep beep, beep beep.
“Hello, David Bockham speaking, how may I help”.
“Hi, my name is Paul Smith and I’m buying a property and have been told that you are best conveyancing solicitors in town.”

And so the conversation continues. Bockham asks lots of questions, Smith gives appropriate answers, which lead on to further questions.

Let’s assume that good though Bockham is, when he answered the phone in response to Smith’s enquiry he could not ‘close’ Smith on the phone. I know, I know, if you’re reading this as a fee earner you don’t wish to think of yourself as ‘closing a sale’ but that’s what you are aiming to do. So, as Bockham can’t get Smith to say ‘Yes’, Smith asks him to write and confirm his proposal in writing.

Let’s look at another scenario. You run a seminar, and invite clients and ask them to bring a friend or colleague who might be interested in your services. You collect business cards, or ask attendees to fill in a registration form. Either way, you collect their contact details.

The sixty-four million dollar question
Where does Bockham enter my name and address or where does your secretary enter everyone’s names after the seminar?

Easy question, or at least it should be. However, most of the smaller firms that I speak to, do not put Smith’s name into any kind of database. Now, when I say smaller firms, I don’t mean sole practitioners and two partner firms, I’m talking about firms of all size up to 20 partners and more!

The answers I’ve had to the question above include everything from we:

Enter the name into Outlook and forget about it;
Enter the details straight into Word and send a letter/fee note/thank you;
Put the name on a 3” x 5” card ; and,
Ask the client to write in and confirm the instruction (I kid you not).

I know some fee earners who tell me that they put the name and address into their case management system, open a new matter and send a letter. Then I remind them that they are not yet a client so why open a new ‘matter’ and they look confused.

I’ve had partners tell me they have no idea what happens!So, not such a straightforward question after all, but it should be.

The opportunity
From a marketing perspective the firm has just wasted a future lead. Just because I choose not to instruct you this time, what’s to say that I won’t instruct you in future?

For example, if Smith is dissatisfied with the service from the firm he does give the conveyancing work to, is he likely to use them for Granny’s probate when she dies intestate? Probably not. So, is he likely to use your firm? Probably not.
Why not? Well, the main reason is that he is unlikely to have you at the top of his list of law firms. He phoned once and spoke to someone (Bockham), he might have received written confirmation of your services and fees, but that’s long forgotten.

You’ve done nothing to remind Smith that you still exist! See the point?

Let’s take a lesson from the insurance industry. My car insurance is due in March each year. Each year I get a renewal notice from my current insurer (Eagle Star), and yet again the premium has gone up even though I’ve had a claim-free year. So, yet again I waste an hour on a Saturday morning getting a couple of quotes from whomever’s TV advert caught my eye the evening before, let’s say that it was Direct Line and eSure, or even one of the many comparison sites that now seem to proliferate. So, in the end I decide which insurance company I’m going to use; let’s say that this year it’s Direct Line.

Now, jump forward 12 months. February arrives and what happens? First Direct Line will send me a renewal letter with my new premium for 2009-10. I suspect it will increase again. But the key to this example is that Eagle Star and eSure will both write to me as well. Their computer systems know when my renewal date is and will endeavour to win my business with a competitive introductory offer. I suspect that I will receive other offers from them throughout the year.

If your answer to the sixty-four million dollar question was ‘in our CRM (customer relationship management) database’ then congratulations, you are the exception not the norm. But for me, this is only half the answer. Capturing a name and contact details is the first step. The next step is doing something with your bank of prospects. After all, it’s what you do for the next 12 months that’s important.

So, Smith has not become a client. If during the conversation Bockham uses one ‘key phrase’, then Smith is fair game until he tells you otherwise. This key statement could be: ‘No problem Paul, I’ll confirm our fees in writing and wait to hear from you. Additionally I’d like to keep in touch via our firm’s email newsletter. Would that be OK?’

Most people are polite in this situation, Smith is no different, so he says ‘Yes.’ So Bockham goes on and collects his e-mail address. That means you can include him in your ‘prospect marketing plan’ until he tells you to stop. Asking this question means your marketing will meet the requirements of the Direct Marketing Association and the Solicitors Regulatory Authority, that is to say you’ve got the express permission of the prospective client to use his e-mail address.

Marketing to prospects
So, what’s the basis of a marketing plan for prospects? Well it will be different for different kinds of firms. A law firm with 80 per cent of revenue from publicly funded sources will have a very different plan from a commercial law firm. However the principles are the same.

The key principle is regular, timely, cost-effective communication. Let’s take each of these components in turn:

Regular – for a law firm with predominantly private clients as prospects this might be three times a year. For commercial client prospects it could be monthly;
Timely – there’s no point sending out an Employment Law update in June about a legislation change the previous January. You must tailor the message you send to your prospects based on what’s current and relevant. It’s why accountants get Budget reports sent out the morning after the Budget;
Cost effective – if this marketing plan is not cost effective most of you won’t commit to it as the partners in your firm will not think it’s necessary or effective.

We will consider this last point in the next section.

3D marketing – drip, drip, drip
By 3D marketing I mean the ongoing communication to prospects in a regular, timely and cost-effective way. This enables you to remain upper most in the minds. Here I’ll draw a distinction between the two professional service markets I know best, accountants and lawyers. Accountants have it easier than lawyers. Every year clients come back for their accounts, audit or tax return work. Not so for lawyers. Law firm clients only return when they have a problem. The key to legal marketing is raising client anxiety just enough to make them see they have a problem.

I believe that the most effective way of doing this is with e-mail newsletters. Printed newsletters still have their place, but email is the way to go. Printed newsletters do not facilitate timely communication of important news and changes compared to the relatively instant ability of an e-mail communication which can be received within seconds of being sent. However, if you can’t get the hang of computers and believe that the deforestation in South America is sustainable, then printed newsletters are better than nothing, and many of our clients still use them to some degree.

In my experience the challenge is to ensure you adopt the right approach and that the right information is communicated.

The CRM functionality you need to embrace e-mail marketing should integrate seamlessly with your IT systems so that data can be managed and used with ease. The market leader for this kind of technology in the legal sector is clearly Interaction, but for most two to 20-partner law firms it’s priced well out of reach. So, if you’re using Partner4Windows, Videss, Solcase, SOS or any of the case management or accounts systems it’s to these vendors you need to turn.

Cost effectiveness
Let’s look at some examples. A three-partner law firm with 5000 prospects has the option of sending them a printed newsletter or an e-mail newsletter (see Table one). This shows the cost saving of email over printed communication. Even using a e-mail response rate of 50 per cent of that of a printed newsletter the CPI is still 56 per cent less. At the same response it’s 78 per cent less.

Equally as important is that the difference in total cost of in excess of £20,000 would almost certainly pay for the CRM system needed by this three-partner law firm to allow them to utilise this kind of e-mail marketing campaign.

Bear in mind, all I’ve shown here is the cost for marketing to non-customers. Let’s assume that on top of this, this firm also communicates with it’s 10,000 existing customers eight times a year on average (12 for commercial clients, four for private clients). Total costs in this case are as follows:

Printed Newsletters = £58,160;
E-mail Newsletters = £7,120.

What could your firm do with the money freed up in this kind of marketing campaign?

Conclusion
So what conclusions can we draw from this analysis? First that marketing to non-customers must be a given for professional service firms who want to grow their business. For the rest of you, good luck! My problem with being told by partners in firms that ‘we have enough business’ is that that may be true today, but in business you are either growing or shrinking, you’re never standing still. Your costs rise but your charge out rates rarely do. In which case your profits are shrinking if you are not increasing your revenue.

With the impending arrival of the Legal Services Act, things are set to change quite dramatically. Are you ready for someone to ‘move your cheese?

David Gilroy is sales and marketing director at Conscious Solutions, a firm which specialises in providing creative solutions in websites, marketing and intranets for law firms.

To recieve a PDF version of Table one, please e-mail Lucy McNulty at lmcnulty@ark-group.com.

A copy of the cost-effectiveness shown in Table One can be downloaded at http://www.conscious.co.uk/calculator