Law Firm Marketing - Increasing Your Revenue By Grading Clients

Law firm marketing is comprised of many different elements. The analysis of your firm in law practice management can be complex, however, lets begin with a key success variable - your current client base. Managing your client base is the most important aspect of your law firm marketing efforts. I suggest you begin with grading your clients.

The ABCD Solution

In looking at your client base for law firm marketing purposes, you can use a time-tested method of analysis. This is the key concept of "ABCD clients". Service professionals of many types use this method to accurately rate and organize their client base. And for effective marketing for law firms, this method is priceless. By the way it is not just about marketing. It is also about serving your clients better than ever.

As you certainly know in schools we use the letter grading system to rank the students in order of how well they perform on papers, tests, quizzes, etc. Similarly we will "grade" our clients. So think of your client grading system for law firm marketing as summing up all the aspects of a good client.

A client who gets an "A" would be one who has reasonable expectations, follows your instructions, is grateful for the work you do as well as courteous and professional in their demeanor with both you and in particular your staff. In fact if you are ever wondering if someone is an "A" client or a "D" client just ask your staff. The "A" client sends you referrals that turn into "A" clients as well. The "A" client is never concerned with the fees you charge since they know your services are worth the cost. They pay their bills on time all the time. And finally, their cases are interesting and substantial matters. Now isn't this the kind of client you are aiming for in your law firm marketing in the first place? Additionally, have you ever heard the old saying "birds of a feather flock together"? This means your "A" clients know a lot of other "A" clients who they can refer to you if you play your cards right.

Of course a client with a "B" grade would have many of the same qualities of the "A" client, but not all. A client with a "C" grade would be closer to a "D" client. A client with a "D" grade is the complete opposite of all the characteristics of an "A" client. They don't have reasonable expectations, they pay their bills late (some not at all), try to negotiate lower fees or retainers, don't follow your instructions (may even think they know better than you do), are rude or unprofessional, they do not send referrals (or if they do they are also "C or D" clients), their matters are not substantial and interesting, and they often complain about normal fees. Not a pretty picture these "D" clients. Let your competitors have them!

In targeting your law firm marketing, "C & D" clients are not the kind of client you want to attract. Most firms find that "C & D" clients take up between sixty to eighty percent of their time and efforts, while only bringing in twenty to forty percent of the firm's revenue. Does it make sense to cultivate this type "C & D" business? Of course not. You need to stop taking "C & D" business and "fire" (ethically of course) any "C & D" business that you can. Even if you only begin with the "Ds" it is a beginning. Quite liberating as well my clients report to fire these folks.

Effective marketing for law firms includes a realistic look at what will bring the best benefit for the best clients. Ridding yourself of clients who are graded a "C or D" is one of the best things you can do for your "A & B" clients. Without spending all your time on the "C & D" problems and concerns, you can pour your attention into your "A & B" clients (moving their matters to conclusion faster thus you can do more of them). Thus the "A & B" clients will be even more satisfied, resulting in more referrals and more business from them. Clearly a "win/win" for all.

Another big, big advantage of spending less or no time on your "C & D" business is you can focus more time on developing your "A & B" referral network. Your increased marketing time and more focused law firm marketing will result in more quality "A & B" business.

What I have found working individually with over 500 attorneys is most of you will need to limit your practice areas to one, two or maybe (and I do mean maybe) three practice areas in order to drop your "C & D" cases. Too many attorneys are practicing "threshold law" that is defined as taking anything that comes across the threshold of your office. In selecting your practice areas try to incorporate cross-salable areas, such as wills and trusts, real estate, and/or estate planning for example. Select the most lucrative practice areas you have and then pour your law firm marketing efforts into those targeted practice areas while focusing on "A & B" clients and referral sources. This may be a bit frightening at first and in the long run you will be extremely glad you did.

How to Write Bills Clients Rush to Pay

By Andrew C. Simpson
If your car mechanic handed you a bill that read “fixed car – $1,000” you’d probably question it, even if the car was running great. You might even drive off and delay paying the bill. Or wait for the mechanic to call to ask about it.
Often we forget that our clients examine our bills in the same manner. We want the mechanic to justify the $1,000: How much for parts? Why did it take so long? A paragraph of explanation goes a long way towards getting the bill paid.
Lawyers are in a more difficult situation. We expect payment regardless of results. Often we’re unable or unwilling to seek payment in advance. And ethical rules may preclude holding the file hostage. It’s important, then, that your invoice helps the client understand the true value of your work.
A lawyer’s invoice should provide a detailed accounting of services rendered. If you bill by the hour, specify the date and amount of time spent and the services provided during that time billed. Describe the services with particularity. If a motion for summary judgment takes 40 hours to draft, never submit a bill that simply lists five entry dates of “Work on motion for summary judgment – 8 hours.” Break it into smaller increments with descriptive detail for each increment. For example, Day 1 might read:
• Reviewed key evidentiary documents and deposition testimony; began drafting statement of facts section of motion for summary judgment – 3.4 hrs
• Drafted “Statement of Uncontested Facts” as required by Local Rule 56.3 – .9 hrs
• Outlined argument – .5 hrs
• Begin draft argument regarding plaintiff’s easement by implication claim – 2.4 hrs
Provide similar detail even if you flat-fee bill, though there’s no need to break it down by date and amount of time. Remember, your bill is also a marketing tool. You want the client to be so pleased to have gotten so much value for the money that he or she returns for later work, or brag to others about the amount of work you did and your reasonable fees.
Here are two more tips. 1) List the time and expenses that you normally write off as “no charge.” I practice insurance defense and many items are considered overhead by insurance companies. I list them at “no charge” on my bill. I’ve had clients call to say they’ve never before received anything free from a lawyer! 2) Email bills as PDFs. I receive some checks within a week rather than the 30 days’ wait with a paper invoice.
Your bottom line? Treat clients the way you want to be treated. Write a bill that you would want to pay, and your clients will pay promptly.
Andrew C. Simpson is a lawyer in Christiansted, U.S. Virgin Islands. Contact him at asimpson@viaccess.net or visit www.coralbrief.com.
Copyright 2007