Stephen Fairley 0000-00-00 00:00:00
How do you help a client who doesn't know what's best for them and focuses on the wrong area? I work with hundreds of law firms every year and one of the most common requests I hear from attorneys is, "I need more leads." Yet when I inquire further into the specifics of their situation, I often find that lead generation isn't their primary problem—it's lead conversion. Let me explain. I was recently speaking with a Phoenix bankruptcy attorney who claimed he needed more leads to build his practice. I asked him approximately how many leads were coming into his law firm each month. Needless to say I was astounded when he informed me his firm's marketing was consistently generating in excess of 100 to 150 new leads every month! Even with modest conversion rates you should be able to generate at least $500,000 annually with this many leads. Yet he was experiencing serious cash flow issues. I kindly told him I did not believe his biggest issue was lead generation, it was lead conversion—converting more browsers into buyers. I walked him through our Rainmaker Lead Conversion System and how it could help him fix his follow up and convert more prospects into paying clients. Unfortunately either I did not do a sufficient job of justifying my response or he did not believe me because he persisted in the belief that he simply needed more "qualified leads" and all his problems would be solved. Lead conversion is the most overlooked area at most law firms and it has the potential to significantly increase your revenues this year Imagine the impact on your firm's revenue if you improved the rate of conversion by just 10%, much less the 20-40% increase we have seen when using a formal lead conversion system. I often ask attorneys about their closing rate - the number of appointments they turn into paying clients and they invariably say that it's "very high" or "excellent," but upon carefully examination, it tells a different story I find the majority of attorneys significantly overestimate their closing ratio. Just like practicing law, converting leads into paying clients is a skill that takes practice, but you need to understand how to track your data and analyze it. Three Major Areas to Analyze There are many variables you can consider if your practice isn't generating the revenues you want, but after nearly a decade of specializing in helping law firms improve their lead generation and lead conversion strategies, I have found there are really three major areas that tell most of the story: 1. Lead Generation - This is the system of attracting new potential clients to your law firm.You can use both online and offline strategies. Online or Internet related strategies include a website, blog, social media, and search engine optimization. Offline marketing strategies include referrals from current and former clients, monthly newsletters, building relationships with potential referral partners, networking, speaking and seminars. It's important to know that lead generation is the second most expensive thing you will have in your law firm, the first being payroll. You must take a systematic approach to lead generation. Without this, you are reduced to sitting in your office waiting for the phone to ring or a referral to walk in, which is not a good place to be. 2. Lead Conversion -This is your ability to turn leads into paying clients and is what I will focus on in this article. 3. Client Retention - How to keep your paying clients coming back for more and/or referring your firm to everyone they know with a similar problem to theirs. The first step in lead conversion is to develop a "universal lead definition" (ULD)— what precisely is counted as a lead, who counts the leads, how you track the leads, and what does not constitute a legitimate lead. We teach our clients that a lead must meet all three of these criteria: 1. Someone who has never done business with you before (versus a repeat client). 2. Everyone who contacts the firm via email, phone, social media, personal referral, Internet, networking event, seminar; etc. 3.They express an interest in your services. In order to build a financially successful law firm you must be committed to tracking every single lead and following up with them religiously! Far too many attorneys only track the appointments that show up (and if the truth is told they are not even very good at doing that) or how many of the people they meet with in person who sign up as a paying client at the initial consultation. What they don't recognize is that is only the fourth stage of lead conversion and there are five stages. Here are the five stages of lead conversion for law firms: 1. Number of Leads into the top of the funnel 2. Number of Leads that turn into Appointments 3. Number of Appointments W h o Show Up 4. Number of Appointments Who Sign Up at the Initial Consultation 5. Number of Appointments who Sign Up Later No lead conversion system is complete without tracking all five stages. How many of your leads turn into actual appointments? How many of those appointments actually show up? How many of those people who show up sign up at the initial consultation? And how many people sign up later down the road? Each of these numbers are critical to track because if you know what your conversion rates are at each stage than you can determine where your biggest challenges are and develop a plan to improve. The greatest value of a true lead conversion system is that it gives you direct insight into the actual state of your company and allows you to efficiently automate the follow up process with dozens and even hundreds of leads. We have helped our clients compete with and beat much larger law firms simply by creating an exceptional follow up system. Lead generation too often comes down to a firm's financial ability to "throw money at the problem," but a lead conversion system can level the playing field and give small firms a true unique competitive advantage. What is an acceptable conversion rate? Conversion rates can differ widely depending upon your practice area, but in general the lower your average client is"worth" to your firm the higher your conversion must be in order to run a successful firm. For example, if you practice consumer bankruptcy and the average chapter 7 client pays you $1,500 to handle their case you must have a higher conversion ratio than the business litigation attorney whose average client pays them $50,000 to $100,000 in legal fees. For consumer attorneys you need at least a 15- 20% conversion rate to run a decent practice. This means for every 100 leads your marketing generates you need to sign up a minimum of 15-20 people. Consumer firms with a comprehensive lead conversion system often experience double this rate, which means they can be very profitable.Think about it this way: if you generate 50 leads per month and close 10% at an average fee of $5,000 per client that means you made $25,000 in gross revenues (assuming 100% collection rates). However; if you increase that conversion rate to 20% you would double your revenues— with the same amount of leads!The key point is that even small increases in conversion rates can make a significant difference in your revenues. How to increase your conversion rate The key to increasing your conversion rate is to fix your follow up! This is another area that many attorneys think they are doing a good job, but upon further investigation I often find massive gaps in their follow up process.Too many firms follow the approach of "only taking one bite out of the apple," that is to say they try to get the prospect to retain at the initial consultation (or worse over the telephone) and if they do not first succeed then they give up and go on to the next person, without ever trying again to get that business.This is a major mistake! When someone doesn't retain you at the first meeting, rarely does the problem that brought them to you go away on its own accord. Understand that when they don't hire you, they are not saying "no," they are usually saying, "not yet" or "I'm not ready" But circumstances can change and sometimes very quickly. All of the sudden the legal issue goes from the back burner to the front of their mind and retaining an attorney becomes the most important thing in their world. If you have a system that helps you stay connected with them via email or periodic phone calls then they will more than likely retain you when they are ready versus going to one of your competitors. However; if you fail to fix your follow up, when they are ready they will likely start the search all over again and you will likely lose this client forever: Let me give you a simple illustration. When an attorney calls me to get some ideas on how to market their law firm I often end up inviting them to attend one of our Rainmaker legal marketing seminars, but often the dates of our seminar conflict with their schedules. It's not that they don't want to go, it's "not yet" or perhaps they are not mentally ready to make the jump to the next level. Either way, if I depended on my memory to follow up with them some time in the future we would be in serious trouble! Instead we have implemented a comprehensive follow up system that includes multiple keep in touch emails and automated reminders that help us remember to call that person weeks or even months after the initial call. In addition, we are committed to sending out a newsletter every single month and have been doing so for years. I regularly hear from new clients how they have been receiving my newsletter for 5 to 10 years and finally were ready to sign up and start working with us. Talk about a long sales cycle! It's a good thing I don't depend solely on people like that to build my company The point here is if you have a comprehensive system that follows up with potential clients for long periods of time you will reap the benefits. If you are interested in how a lead conversion system can help your firm fix your follow up and convert more browsers into buyers I invite you to call our office and set up time for us to talk.
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