Winning and Retaining Clients in Legal Practice
I would wager that there is a constant theme running through all law firms up and down the breadth of the land – we need more/better/bigger clients. This will be driven either by an economic imperative (the need to grow in accordance with your firm’s 3 or 5 business plan) or, in some cases, it will be a matter of survival!
Up until fairly recently, most legal practices have relied upon a small but loyal cabal of clients to grow their practice and these have been quite easy to manage but as the firm has expanded so there has been pressure to grow the client base. This has usually meant the focus has been on a few (senior) Rain Makers to bring home the bacon. You know the type of person – the one who embodies the DNA of the firm – and clients come to him/her based on personal recommendation from other satisfied clients, friends or other professionals who have a good reciprocal arrangement.
The problem is that a lot of these people are either coming up for retirement or those people who might have the innate skills to garner long-term professional relationships are unlikely, in these 24/7 times, to have the luxury of being able to spend the same amount of face time as their predecessors. Even where it is patently clear that these ‘goodwill’ clients may not continue to instruct the firm once the person steps fully away from the practice, not enough time and attention is being spent working out a succession plan to keep these clients loyal to the firm.
As someone who has worked in legal practice since 1996, I have seen a seismic shift in the way that law firms approach the task of retaining and winning new clients. There has been a realisation that sales/business development is a key component of legal practice.
One of the first questions I am asked when meeting with a prospective client (normally in professional practice), is how they should go about winning new clients. Very little enquiry goes on (of me) around the existing clients. This is possibly because they have already worked out the startling reality that their client base is too weak to grow the practice. By weak I mean the fees per client are too low. In these days of ever increasing regulation, more firms are moving away from processing low value work, unless, of course, it is the proverbial sprat to catch a mackerel or the Trojan Horse scenario.
Some firms will not be sophisticated enough to have worked out their average client billings or the profile of their client base, and if that is the case, my advice is that before you start down the “we need more clients” route spend some time in properly analysing your existing clients. Don’t just look at the plethora of databases that will be available to you but go and speak to some of the more influential fee earners about current or past clients to understand the likelihood of those clients being capable of growing further than the current legal spend. I don’t just mean the perennial questions about cross-selling but about going deep with that client and understand if they have the ability because of their own profile, management or market to develop into a more progressive client. And don’t forget those clients that even though not substantial in terms of billing have a number of people who are influencers either in the local market or in the sectors that you operate.
Once you have worked out the strength of your existing clients, then my advice is to go deep with the Pareto Principle – the 80/20 rule – and figure out a way to go OTT with your service delivery and adding value to the 20% of clients that give you 80% of your business. Think “Remarkable”; think Best in the World; but just focus on these clients and don’t get distracted by the naysayers who are reluctant to work with such a seemingly small group of clients.
It is not just that these clients are your biggest clients but it is also those that:
- Fit your firm’s profile, culture and style;
- Have the greatest potential for growth;
- Have a number of key individuals who will be your walking ambassadors within the sector that you are focused on developing and will generate referrals for you; and
- They are likely to be a source of recommendations that will give you extra or increased profile in the sector in which you wish to operate.
Now I am not blind to the financials. You are not going to change this model over night but the mindset of less is more is what is important. The experience counts for everything and if you have the mentally that you must act for everybody then the service levels will be severely compromised.
As to new clients, my advice here is to not worry initially about the roster of clients that you would like to work for (they are likely to the same list that has been put together by every other law firm in your neighbourhood) but rather look at your firm’s expertise, capability and most importantly mix of personalities. Why personalities? Well, simply put, people (yes they stand behind all large businesses) buy from people they know, like and trust.
Even in a fledgling scenario where you know nothing about the client, you need to carefully consider if you have the right blend of skills, legal and people, to work effectively with the newbie client. I have to say that I would be concerned if you were starting this far back in the sales cycle? This is particularly with a new client on your patch. Leaving to one side some of the sophisticated CRM systems, I would be surprised if your team didn’t know some of the people in the organisation so that when it came to the sales-planning exercise you could consider the essential question about doing business with people with someone they “know, like and trust”.
Once you have cracked this exercise then you should arrive with a fairly small list of potential clients. You should then consider:
- Assigning a lead person and small team to work up a client plan. This will be focused on understanding more about the client – the movers and shakers, their key clients, and their likes and dislikes concerning their suppliers;
- Do a SWOT analysis of your firm’s service capability;
- Undertake a PESTEL analysis of your potential client. PESTEL stands for Political, Economic, Societal, Technological, Environmental and lastly Legal. Here you are looking inside out and asking the perennial question, under these discreet headings, what is likely to be keeping the management up at night and worrying about what? Within these themes you will able to work out which type of collateral or newsworthy material you think they would be interested in. At the moment you will be thinking about your off line material – newsletters, brochures and networking events – that you can dispense in a timely and consistent way. The whole idea is to have something that you can follow up with a telephone call to arrange a meeting or an invite to an event, ideally an event that is industry focused as opposed at this stage to a social event;
- Make sure that everyone is accountable;
- Place some strict time lines on the outcome. In sales methodologies, one of the techniques you ware taught when dealing with cold calling is that it is a numbers game so that for every x number of calls you will receive y orders. It might appear a crass way of approaching the selling of professional services which I have long espoused requires a completely different methodology to the industrial sales paradigm but the hard truth is that you need to get to the point of understanding and knowing if your new client is likely to buy from you;
- Make sure you have your sales presentation or service offering worked out in advance. If you do find that the client contact agrees to see you, it is very important that you don’t wing it;
- Make the process as enjoyable as you can. Celebrate your victories. I am not suggesting that you make it too cheesy like having a bell to ring when you win a new client or dole out chintzy gifts but just think that not everyone will have as much invested in the outcome as others and a financial reward might just make the difference between success and failure.
The other important factor to bear in mind is training. Don’t think that the sales skills are innate to all lawyers and if you need to buy in some external help then do so. My own experience of being trained and now delivering my own personal brand of sales training is that a small amount can go a very long way. Yes I know in these straightened times, it will be difficult to see the immediate value but that feeling will be forgotten fairly quickly when you win your new client.
Make sure there is a bigger purpose that people are working towards. If it is to change the culture and ethos of the firm then make that explicit. Success begets success begets better clients begets a firm that people feel energised to work in.
Finally the greatest piece of advice I can give is to be persistent. Don’t give up, EVER. If you need some inspiration then there are an abundance of great books out there but my favourite will and still remains Think and Grow Rich by Napoleon Hill. Master the principles in that book and success is around the corner.