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In the unpredictable world we live in, it isn’t uncommon for you to wonder if your firm is charging too much or too little. Are your billable rates in line with your competitors? Is it best to bill by the hour? By flat fee, subscription? It's no question that there are a lot of options. So with all this in mind, how do you determine your firm's profitability? How can you make decisions that will be in the best interest of both your firm and your clients? Let's take a look.
There are five critical steps you should be taking when you're considering how to price or re-evaluate your legal services.
Yes, you are delivering legal services, but that is not your quote-on-quote product. Take the time to evaluate your niche and your unique value proposition.
Whether you’re a software company or a law firm, you are ultimately selling a product. There are millions of products in the world, so being able to narrow down and pin-point your offering is crucial to making you stand out. Are you a real-estate attorney with subject matter expertise in environmental liability issues? Are you a family law attorney who has expertise in same-sex couple adoption? As you begin to look at your profitability metrics, it is important to narrow down what your firm specializes in and use those case numbers to more accurately reflect how lucrative your firm is. Drilling down on what makes your firm unique will only bolster your client experience, but your profitability as well.
When you look at your revenue model and you’re considering how you want to bill your clients, the first place you need to be looking at and research are the market demands. Analyze what your potential clients want, what they are looking for, and what they’re demanding. Are you serving small business owners who may want to pay for services as work pops up? Or perhaps you’re serving primarily start-ups with small budgets who prefer to see all costs upfront? No two clients are the same, so it is important to understand what they’re looking for and how you can best meet those expectations. Additionally, you must also take into consideration the operational requirements needed to manage those clients. For example, if you’re billing hourly, then the operational requirements to successfully do this would require a software that allows you to capture and track your time.
The truth of any business is that it costs money to acquire new clients. Customer acquisition costs represent the time, money, and effort required to get leads and then convert those leads into paying customers.
Look at the data you have available. It is best to go over things in increments of 6, 9, and then 12 months to ensure you’re getting the most accurate information. When you’re considering your sales and marketing costs for your firm, the first thing you should think about is your time. This could be the time spent on business development, networking events, anything that takes time out of your day to pursue in the effort to expand your book of business. Next, tabulate any additional money spent on digital advertisement, or direct mailings. These hard costs will be the foundation for determining your customer acquisition cost. Your costs to close a lead are incurred through the bottom of the funnel activities that take up your time like consultations or meetings.
Let’s go through a fictitious example utilizing 12 months of made up data:
In this example, we took the estimated cost of your time plus the amount you spent on marketing and targeted campaigns to determine a total sales and marketing figure. We then took that figure and divided it by the total number of clients you work with throughout a given year. With that number, you subtract the final estimated costs associated to close that specific lead, and what is left is your total cost to acquire that particular client.
So going forward when you consider growing your business, this type of easy calculation will be able to help you understand that if you invest X amount of dollars, you will be able to attain X amount of new clients. By adding some predictability into your equation, you will be less surprised at the end of the road if things don't go your way.
Customer LTV represents the amount of business value or gross margin that is received over the course of a client’s lifetime. When that client first steps through your door, you must begin to evaluate how much revenue you are gaining from your client on a case-by-case basis.
Let’s go through a fictitious example of an attorney who bills by the hour utilizing 12 months of made-up data:
In this example, we took the number of hours this fictitious attorney was spending on Client X’s matter and multiplied it by their billable rate. Next, we took a look at how much money the attorney was spending to do that work. In this case, 25 hours of work resulted in 17 billable hours, which converts to a little over 70% profit margin. And lastly, we multiplied that total profit margin number by the total number of matters Client X typically brings to this attorney in a 12 month period. This resulted in an LTV around $14,400. A customer’s lifetime value is important to calculate because it will highlight to you which clients bring you repeat business without you having to spend those marketing and sales dollars to get them through the door.
Understanding how to calculate LTV in this easier scenario will allow you to replicate this information when you start looking at multiple fee arrangements. Like discussed earlier, if the market is demanding subscription billing, or consolidated billing (to just name two), you and your firm need to be able to meet these needs in order to remain competitive. Your customer experience will make or break your business, and how your clients want to be billed needs to be met with “yes we can make that happen,” not “sorry, we cannot accommodate that billing arrangement.”
At this point, you have figured out what expertise and skill set you have that sets you apart, you have determined what specific product you’re offering, how your want to set up your billing structure, how much money it costs for you to get clients in the door, and how much margin you can generate from that client in a given period of time. The last step now is to understand your fixed costs. Fixed costs represent the amount of money you are spending to support your law firm as a whole. On an annual basis, how much money are you spending to pay the firms office rent, support staff, legal technology, annual license fees, etc? These are your fixed costs.
The things that are really important when you look at customer acquisition costs and lifetime value are the scalability of your law firm and whether or not you can be sustainable in the long term.
The first thing you can do when you have these numbers is to look at how long it takes you to recoup your customer acquisition cost. To do this, you take your total $627 CAC cost and divide it by how much profit you generate, which in our fictitious example was $4,800. So, what this means is that you recoup your CAC by the time you are 13% of the way through your first case with that client. A general rule of thumb is that you recoup your customer acquisition costs within that first year of starting the particular matter. This low percentage indicates that you have a little more room to spend on acquiring new clients if you so choose.
The second thing you must do is ensure you’re making money over a customer’s lifetime. If you take the $14,400 LTV we calculated in the fictitious example (profit per case multiplied by the number of cases that client brings to you in a year) and divide that amount by the $627 CAC cost, that’s roughly a 22.3x return on investment per client. This is a huge number! This indicates that you could lower your billable rate to get clients through the door and still make a decent size profit. Do your research and determine where the market stands and then evaluate if you have room to adjust.
Your CAC and LTV are what we describe as unit economics. In the long term, if what we calculated are your unit economics, can your firm ultimately make money? The answer would be yes. From a business perspective, there are always things you can do in the short-term that will get you by, but those bandaids will eventually come off to reveal a less than favorable result. Let’s do some quick calculations. If you’re generating $6,800 in revenue per case (determined from our LTV example), and you’re taking on about 50 cases per year, that’s about S340,000 in annual revenue. Now let’s say your direct costs total around $95,000 a year to serve that revenue, you’re left with a gross margin of around $245,000. Now, after your fixed costs, and sales and marketing expenses (for this hypothetical example, let’s say those total up to $50,000), your total income before tax comes to $195,000. If you can make these calculations each year, you will be able to determine if you can serve your clients profitably, while also saving enough cash for future growth.
All of this leads to what you should walk away with… without favorable unit economics, you will not have a sustainable law firm in the long run. Understanding how much it takes to bring new clients in and how much money those clients bring to your firm over the course of their lifetime will ultimately tell you how successful your firm will be in the future. There are levers you can pull after you understand this data. These levers are either revenue or pricing driven like billable hour vs. flat fee, or whether you’re above market or below market. You can adjust these metrics accordingly. The other thing you can do is adjust your service levels. If you’re spending too much time serving one client then you need to either keep your service level the same and bump up your rate, or if your rate is already in line with your competition, then keep your rate the same and spend less time performing that work.
The goal is to understand your data at the customer level to determine whether or not you’ll be successful in the long term with your entire book of business.
The purpose of a billing workflow is two-fold: save your firm time and drive the collections process. There is a lot going on in the world and for your firm, if you can save time on non-billable tasks, stay organized, and increase client satisfaction, wouldn’t you want to? Sure it isn’t always easy to adopt new change and break old habits, but if it means increasing your profitability wouldn’t you want to try?
It’s this simple, technology can help you bill while you work, get your invoices out much faster, and reduce your bottom-line. We’ll show you how.
The first thing you should do is set up your invoice template. Your template needs to be consistent, clean, on-brand for your firm, and easily digestible for your client. It is important that everyone at the firm is trained on how everything is documented so that there is a level of uniformity that is maintained. Additionally, you should ensure your invoice templates account for all of the critical information that your clients want to see, like who worked on a particular item, what they’ve paid you recently, any money in Trust, ledger details, etc. This is an essential piece of communication for your clients, so it is imperative that you give an adequate amount of detail. Your invoice also contributes to your professional appearance, so make sure that it accurately represents who you are.
First, you need to ask your client for approval to email your invoice rather than sending it via snail mail. It is strongly recommended that clients opt into this agreement in a written way. This will help combat those individuals who claim they never got your bill in the mail.
The beauty of an electronic invoice is that it will eliminate the time spent on printing, folding, stuffing, and then mailing every invoice you have each month. This is will also help you keep an electronic repository with documentation on who has paid what and who hasn’t, and depending on what platform you use, some systems will give you the ability to track whether the email with the bill was opened by the recipient or if it went unread.
Legal technology is really opening the door to so many possibilities when it comes to your billing practices. For example, there are some software that will allow you to take advantage of a billing portal where you can provide your clients access to view and pay bills or to access a complete history of bills. Your clients want visibility, and with a portal like this, they're given the autonomy to review what they owe, on their time.
Taxes need to be accounted for in jurisdictions where taxes apply to legal services rendered. Whether this is applied based on where your client lives, or where you’re performing the services, these rates can automatically be applied when you’re creating your invoices. The goal here is to prevent any kind of bottleneck at the end of the month when you’re trying to send your bills out. You could also consider assessing interest on past due invoices to help drive the speed of collections. This will need to be discussed with your client beforehand, it should be drafted up in writing, and something that they can expect if they’re late on a payment. Additionally, some states have found this to not be usury, so please take note of that and do your research as you’re making decisions. Lastly, you can incentivize early payments with discounts. If a client pays within the first 5-7 days of receiving the bill, you could consider offering a loyalty discount. Especially for clients with multiple matters, this will not only get you paid quicker, but it will build trust and establish a stronger partnership.
Even if your firm chooses to pursue only one of these options, you will still be contributing to the reduction of bottlenecks and ultimately speed up your collections process!
Do you want to hear something shocking? According to studies compiled in an ABA blog, if you don’t get your time in by the end of the day, you’re likely to lose 10% of your billable hours. If you don’t get your time recorded the next day, you’ll lose 25%! If you don’t get it in by the end of the week, you’ll lose a full 50%.
So at this point, you’re either thinking, wow, I have lost my firm a lot of money or wow, I need to figure out more efficient ways to track my time.
If you’re thinking the latter, we’ve got you covered. There are services that address the pain points of being a timekeeper. With today’s technology, you have the ability to bill directly from tasks, phone and text conversations, email, and word documents. You can use multiple timers, you can set time to bill in advance and then adjust the figure accordingly in the pre-bill process. All of these solutions aim to remove the inaccuracies that come from waiting until the end of the month to record all your time.
As you are creating your ideal billing workflow, consider setting a hard billing due date. The most well-run law firms bill on a bi-weekly or monthly basis. When you’re ready to bill, you need to identify a cut-off date. Utilize a firm-wide calendar or practice management system to schedule these dates, so any work that was done between that designated time frame needs to be recorded before that billing cut-off date. This does not mean that the billing stops for any work moving forward, but any work that has happened previously needs to be submitted to allow the person in charge of billing time to run those pre-bills.
The next thing your firm should do is set-up automated payment emails. This communication is a reflection of your firm and should motivate your clients to take action and to pay those bills. The email should not be abrasive, but rather warm and include their invoice and clear descriptions for how payment is accepted. If you have it set-up in your system to pay securely online, then this would be an opportunity to include that link. It should also include contact information if questions arise on the bill. The objective here is to make it as seamless as possible for your clients to pay you.
Running pre-bills and batch billing is the ideal, most efficient process. You get all of your information into the system regarding the work and services you’ve performed by that billing cut-off date, then pre-bills are run. Pre-bills allow you to see a preview of your invoices so that you can check for formatting, errors, or omissions without changing matter ledgers. The best part about pre-bills is that they can now be done electronically. Gone are the days where firm administrators have to give their timekeepers different colored pencils to mark up a pre-bill by hand. And did you know that by electronically reviewing and sending your bills, you will speed up your billing by 30%! That is a lot of time!
If you use batch billing, this will allow you to generate all of your invoices at once, in whatever format you designate, in just a few minutes. A lot of powerful billing systems have this feature for you to capitalize on to increase your billing and collections processes.
In, 8 Tips to Improve Your Firm’s Collection Process Right Now, we talked about alternative fees and why you should set those up on your retainer or fee agreement with your client. If you have a situation for example, where you have a monthly retainer agreement, you can set this up to bill automatically. This is one less thing you would have to take care of. If you have matters that you’re billing hourly and then collecting on or deducting from Trusts and you have a monthly retainer agreement, you can set all these permissions up to draw directly from the bank account, or to automatically charge the credit card on a specified day. For payment plans, this is useful to accommodate your past-due clients or flat fees that cannot be paid all upfront. Sometimes clients do need a little flexibility and this fee arrangement is a great way to show them that your firm can be. If your firm chooses to use a reduced rate as an alternative fee, you want to ensure that you document the rate that deviates from your standard hourly to save you time when you bill and ensure you’re not inaccurately billing your clients. Taking care of these things up front will make running your bills at the end of the month much easier.
All these steps can help you deliver an exceptional customer experience while also driving your firm’s profitability. If done correctly, billing doesn’t have to be dreadful! Centerbase offers countless tools to serve your law firm, take a free product tour today, and see how!
Do you want to hear something scary? More than 73% of small law firms surveyed said they experience past due client accounts at least some of the time. And nearly half of those firms say that between 10% and 39% of their total client base is typically past due. These are staggering figures!
Unfortunately, clients don’t always pay on time, and the truth of the matter is law firms are collecting less and less from their clients each year.
So the question that remains is why does this keep happening? Are there specific reasons that bills go unpaid? The short answer is yes.
Aside from a clients inability to pay due to financial constraints, the primary reasons clients forgo paying their bills are as follows:
Let’s break these down further...
When bills are sent inconsistently, it breaks the client’s trust. They may feel they are receiving your services for free at some point if it has been months since they’ve last received a bill. If more than a month goes by between billing cycles, the client may feel like they are being charged too much for services performed months ago and they will consciously choose to not pay the bill. Clients may also dispute bills if they do not know what they are being charged for. Incomplete, erroneous, or unclear billing descriptions are common reasons you may not get paid. If your clients don’t understand what they are being charged for and if they don’t believe you completed the stated services, they are simply not going to pay the bill. This is where follow-up comes into play. Clients may call you if they have a question about their statement, but they also may not. It is your responsibility to follow up with them to ask if they have any concerns or if they need a better explanation of what is in the description for the services rendered. Lastly, if you’re sending your client a paper bill that requires them to fill out and mail a check back to you, you’re making it easy for them to either forget about the bill entirely or see significant delays in receiving payment.
This all goes back to running a client-centered law firm, yes it is your client’s job to pay you, but if you can get into the habit of billing your clients the way they expect, and not the way you have always done it, what will result is a much more efficient collection process. Additionally, it is important to keep up with the technology that your clients are already using. A majority of payments are sent and collected electronically. If you have a client who pays all their other bills online, you can guarantee that they will be disappointed if they receive a paper bill from you. Giving your clients a way to pay immediately will also increase collection. For example, integrations with LawPay make it easy to accomplish modern services like this.
There is an art to billing. Although it is a routine part of your business, it must be treated uniquely and skillfully. It can be very uncomfortable for attorneys to ask their clients for money, but you must recognize that is your value. You worked long and hard hours and you need to be compensated for that. Firms that don't put time and resources into their billing process, are typically the firms who are getting paid less and less frequently.
Allowing younger attorneys to bill for small matters earlier in their career will help build a framework of good habits. Giving the younger generation this experience will also help encourage them to ask questions which will ensure best practice in the future. A good young biller and collector will be a good old biller and collector, and if you make it clear that your firm coaches and teaches newer attorneys on how to bill better, that is just one more advantage you have when recruiting talent. It is important to practice technique and to have worked through a few client concerns early on, that way when you’re working with a client who has a significantly larger amount owed, you will have experience navigating those waters.
Additionally, establishing this culture of mentorship will lead to attorney retention and a greater workplace environment. In Tips For Firms to Attract the Best Recent Law Grads, we discuss how your firm can combat challenges and find solutions to gaining the best new talent. Offering this type of mentorship in the areas that are not being covered in law school will differentiate your firm and subsequently keep your clients happy.
Know your staff. There may be some attorneys on your team who really struggle with the client-facing nature of billing. If you have coached this attorney before, given them all the tips and secrets to learn how to successfully bill, and if they are still not getting it, then it is time to pivot your strategy.
There are practice management software available to you that offer easy and automatic ways for your timekeepers to keep and bill for their time. Whether it’s through phone or text, email, or word documents, make it easier for your staff to bill the way that makes them comfortable while also meeting the client’s expectations.
Your good billers need to be responsible for billing your major clients. This entails knowing your staff, communicating properly, and maintaining just the right amount of teamwork. To be able to quickly detect when something is and isn’t working will be the difference between the revenue coming into your firm and a pile of unpaid bills on your clients kitchen counter.
When it comes to billing, creating, and establishing a standardized process will not only make it easier for your team, but it will ensure more timely payments from your clients. This process will look different for every firm, but billing every possible transaction in a monthly cadence with not only contribute to a routine, but it will also be better-received by your clients. And if you bill paper copies, having a minimum dollar value threshold for bills will help offset the cost and time associated with manually printing, enclosing, stamping, and then delivering the bills to the post office.
Some staff turnover is inevitable, so writing these policies down and training your team on how your firm bills will contribute to uniformity, overall best practice, and easier transition for newer attorneys.
This seems like a no-brainer but a lot of firms will send bills out and then never follow-up on them. If you want to turn receivables into cash, you need to be following up with your clients. Check in on them if they have questions and give them alternative payment methods if the way you originally sent the bill isn’t working for them. If the invoice is more than 30 days old, you minimally need to be sending a new statement, with the first invoice attached. If your bill still has not been paid after 60 days, you need to speak with that biller and find out not only what their billing process is, but what their communication with the client surrounding the bill has been, and their plan to recoup what is owed. If your clients do not want to pay in full, technology nowadays will give you the ability to set up reoccurring payment plans. Asking for money that is owed to you is never fun. Discussing expectations around billing and timeliness of payments with your client at the start of the matter will help increase transparency and hopefully, eliminate the need for you to consistently reach out to your client for payment.
Your bills need to describe your services. If a client can understand and digest what you have done for them, it will be easier for them to pay. Each client you work with is different, some may need more explanation, others may not. Establishing what your client needs to see on their bill will help increase payment frequency and reduce any questions that may come from not understanding what the services you’re charging are. The likelihood of a client not paying their bill is higher when you give a shorter, less detailed description of your service. Investing in software can make this process easier for you.
Your pre-bill process takes a lot of leg work. But with features like epre-bill, you can seamlessly markup your bill, add descriptions, follow all the edits and streamline the entire process. To go a step further, you need to be detailing your billing processes in your retainer agreement. The most important thing you can do before you begin billing is to set expectations with your clients. Here are some potential points you should be thinking about to go over with your client at the start of a matter:
By addressing all of these questions and concerns, you will be able to quickly reference the policies you outlined with your client in the event of a dispute.
The sooner you send your bill after completing a service, the faster your client will pay. Different clients will require different billing strategies. For transactional matters, make sure you bill at or before closing because your clients will likely reinvest the proceeds of their closing. If it’s a litigation file, be sure to bill monthly, and if you bill bi-monthly, make sure your clients are made known of this billing schedule beforehand so they are not blindsided by receiving multiple bills within 30 days.
If you can get an injection of cash upfront to hit the ground running, you need to. And when those funds are low, you need to be able to replenish them smoothly, and efficiently. Automation exists to make your lives easier and to improve your profitability, so take advantage of it! If you’re already a Trust/retainer heavy firm, your clients should be able to make one payment and it automatically split between AR and the replenishment retainer in trust to the correct accounts. This way you do not have to manually track and write multiple checks or transfers from one account to the other.
Communication with your client on the fee agreement regarding retainers is important as well. Is the retainer refundable? Is replenishment on a monthly basis, or on an evergreen basis? These are all questions you need to address with your clients beforehand.
Use financial reports to maintain better billing and collections habits. Everyone at your firm should be receiving a WIP report and Account Receivable report, every month to review. Increase transparency, make it known where each attorney is, and what work they are pursuing. With some software, you can even set up a report center to match the way you analyze data. It will allow you to easily group important reports and set up security on each table, providing different levels of access to your staff.
If you are spread too thin and do not have time to review and follow-up on these reports, then perhaps consider hiring a part-time billing associate. This person would strictly be on board to receive the AR reports, digest them, and then begin following up with the clients who are past due.
Hopefully these eight tricks will help assist you and your firm with expediting your billing and improving your collection process. Results won't happen overnight, but instituting universal practices and methods with undoubtably increase your profitability and keep your clients happy.
The core of conducting good business lies in placing customers at the forefront of everything you do. However, COVID-19 has caused considerable disruptions when it comes to delivering exceptional customer experiences in the ways firms are accustomed to. Most likely, in-person interactions have become scarcer at your firm to minimize the risk of spreading the virus, inevitably making initial first impressions with clients rather different. This is especially true if your firm depends on building rapport and trust that often comes from face-to-face interaction.
That said, delivering the best client experiences is still very much possible; the way it’s done has simply changed and shifted with our digital-first world.
One way to keep them happy? Implement a client portal. Client portals help your staff keep real-time interaction with clients while creating a secure spot for any communication or questions. This also remediates phone tag and lets them know you’re still right on top of their case with regular updates and information readily available.
Here are some tips on how you can execute on delivering great client experiences through a client portal:
For long-standing law firm partners out there, you may be wondering what’s causing so many firms to move their operations to the cloud versus storing things on local hardware. The rapid need that erupted for remote work has created even more urgency around the conveniences of a cloud-based software solution – so everyone’s on the same page and able to access client information safely and securely.
The ability to keep client data in one place creates alignment across your staff and makes information retrieval and updates doable in real-time. Plus, with so many fully integrated capabilities, you can keep track of billing, securely share files, and any notes from calls they have with other staff members all at everyone’s fingertips. That agility is much-needed in today’s hybrid work environment, and a valuable asset when it comes to delighting clients and fostering a client-centric approach to your operations.
Read more: Here are 10 mistakes to avoid when choosing cloud-based software
Now that you better understand the value of cloud-based practice management software, let’s jump into how to best implement client portals to deliver exceptional experiences for your customers so you get more referrals and continue to outdo your competition.
In order to improve client communication and create a client-centric approach to your day-to-day tasks, here are some priorities you should keep in mind when setting up a portal:
Most client portals come built-in with file storage attributed to each matter at your firm. The key is to make sure everyone uses the portal from the start of the case, so all paperwork, notes, and updates are logged for clients to take advantage of whenever it’s convenient. It’s a two-way street – a spot for clients to access things they may be wondering about in their case, but it’s also a tool for staff to easily share files when used with law management software.
Between all the digital phishing and security breaches, hacking emails has become way more common. It’s not worthwhile to risk your client’s sensitive information from being compromised when a portal is a perfectly viable alternative to holding all their data in one place. The nice thing is they won’t need to download anything additional to access – any internet-enabled device will be able to log on to view updates, and they’ll receive a simple notification email whenever any new information becomes available. Security should always be at the forefront of your firm’s mind so clients feel secure when interacting with you; it will create a smooth, positive experience that they’ll be sure to recommend to others.
Depending on your area of law, with a client portal, distance won’t be nearly as much of an issue. Whether a client has temporarily relocated or your firm is currently working remotely, for the time being, everyone can be logged in and have access to all the necessary information on both sides. Not only is this more convenient, but it also creates a better place for client-centric interactions on an ongoing basis. Smoother communication and collaboration leads to better efficiency for everyone.
While there are many law firms out there, there aren’t many that successfully deliver a client-centric model for a superior customer experience. Having a synchronized staff empowered to always deliver and update clients in a way that keeps them feeling top-of-mind can be an essential, distinctive aspect that sets you apart from other firms. Client portals are a vital part of maintaining and nurturing that relationship – from the first conversation to the final bill, every touchpoint is of equal importance to maintaining a client-centric model.
This “always on” model is going to delight your clients. Anytime they’re wondering about the status of their case, or if there’s anything you need from them, they need only check the online portal. And if they’re still uncertain about the status of something, contacting your firm is only one quick message away through the chat function. With readily available billing and documentation, there’ll be no more need for constant calls or emails. Much like the rapid development of chatbots on sites, this instant communication creates the very best experience for clients throughout their case.
Client portals aren’t a magical remedy to all client communication, but it certainly takes the back and forth out of emails. In order to build ongoing trust and exceed expectations, it’s up to you to set the standard for client updates and communications. Consider sending out a weekly or bi-weekly update to your client, or having important dates of theirs (like a birthday, for instance) placed into your software so you can send nice, thoughtful messages instead of a strictly business transaction every time you talk. It’s building these relationships – that you see clients as people deserving of empathy and care – that will let you use client portals to bring exceptional experiences to them every time.
One of the longest processes during the lifetime of a client’s case is the initial steps of onboarding. Despite modern advancements in digital technology, the intake paperwork and setting up their file can take a bit of time after their initial consultation. However, you can expedite this process considerably by spending less time having them sign on the dotted line and more time actively listening and talking them through the difficult parts that come with a legal matter. Most people are distressed and in need of guidance – so be that guidance, and use client portals instead to gather any other information that may be needed (with the exception of what’s required to represent them, of course).
On the client end, it can feel like there’s a long time spread out between updates on their case. With a client portal, you can help ease some of their uncertainties by sending them a message that will alert them via email on any updates that come through. Even if it’s a quick message, this communication can go a long way in demonstrating you’re willing to go the extra mile for them, even if it’s a minor update. With these convenient communication tools, attorneys can easily get support from staff to schedule an update call without all the back and forth emails of “does this day work?”
One of the biggest pitfalls that can occur when a client-attorney relationship starts is the lack of discussion around billing cycles. Before any official paperwork is signed, it’s vital to set expectations on what billing schedule has been agreed on. Once that’s established, a confidential and secure billing statement can be sent and updated for clients through the portal itself. This is a much smoother way of sending a statement that clients will appreciate being able to access rather than waiting on a bill in the mail. Plus, you’ll get paid that much faster by having integrations that offer credit card payments through the system (how’s that for ultimate convenience?).
When everyone is on the same page about what’s happening, clients are happier and staff is able to deliver (and sometimes even overdeliver, in a perfect world). Things are always going to be busy, which is why now more than ever it’s so important to set up a system and customer portal that encourages a secure way of sharing information and data around a case. A real-time system streamlines everything for added efficiency and peace of mind in light of many uncertainties currently happening. Everyone’s happier, and things aren’t forgotten about in a file or lost. It’s all backed up in the cloud and available to view whenever desired. It’s the true key to working smarter, not harder.
When it comes to creating an exceptional customer experience at your firm, look no further than a client portal that keeps them up-to-date 24/7. Even when society goes back to in-person interactions more frequently, the benefits of a secure online portal will continue to be a useful tool for delighting customers at your firm throughout their case. This “new normal” has created some lasting changes – and firms must adapt to meet the demands of the modern customer.
If you’re interested in the other benefits client portals to have to offer, please feel free to contact us for a no-obligation chat. We’re passionate about helping firms enhance experiences with clients to truly set them apart from the competition.
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Over the past 10 years, the legal industry has finally started to embrace innovative, customer-centric marketing tactics and strategies. For a long time, however, firms have relied on the strength of their partners and personal relationships to grow and drive business. But times are changing. There are more firms in the US than ever before and the competitive landscape is continuing to grow. However, with the advent of review sites, alternative fee structures, automation, and alternative legal service providers, firms are faced with a tremendous challenge.
Today, we’re seeing firms struggle to stand out as dominant forces where neither prestige nor competitive rates can ensure continued business. Corporations and individuals are looking for more from firms. Whereat one point, simply good counsel was enough, now they are looking for firms who align with their goals, missions, and strategy to make them look heroic.
This is where your brand comes into play. And before the naysayers jump in, yes your firm is a business and a star partner cannot carry the ship alone. At least not in 2020. At a time where differentiation is critical, what we’re still seeing is generic, copy-cat websites, and jargon-filled taglines that fall flat at the feet of new clients. With all this in mind, we’re going to take a look at the state of law firm marketing, the importance of communication and data collection, metrics to gauge your ROI, and automation tools that will make your marketing process a little smoother.
In 2013, the legal services industry generated 256.66 billion dollars in revenue. In 2018, this revenue increased to approximately 288 billion. That is a lot of money. Although there is a huge opportunity in the legal market, law firms are not setting themselves up in a successful way to gain those clients.
So this leads to the question: how are firms handling their marketing?
A tech report done in 2019, noted that 47% of firms overall have a marketing budget. Additionally, those responsible for “handling” marketing still lies largely with the attorneys themselves. 59% of respondents, including 60% of solos, said attorneys perform these functions within the firm. A Bloomberg law study concluded that 62% of respondents say their firm is increasing its focus on marketing and business development and 63% of respondents say they expect their firm to increase its marketing and business development budget over the next two years.
This is a priority for many firms, and not only is it a priority to increase budgets in these sectors, but it has also become a priority in terms of where attorneys and firms are allocating their non-billable time.
In a legal trends report, 33% of the firms surveyed reported that they’re spending their non-billable time on business development efforts, so this means that it isn’t just the money investment going in, it’s the time investment as well. Even though firms are putting a lot of time, money, and effort into these activities, many firms are not tracking the output of their efforts. In the same legal trends report, 91% of firms can’t calculate a return on their advertising investments and 94% don’t know how much it costs them to acquire a new client.
Where are clients finding lawyers? What is the most beneficial way to promote your firm?
The top source for finding a lawyer is through referrals. So knowing this information, how can your firm improve referrals? Typically it’s by collecting feedback and understanding client experience. But then how do you collect that data? Do you formally ask in person? Do you make a dedicated phone call? Email survey?
If you’re thinking about the competition in the industry, simply asking and recording your clients' feedback can make a tremendous difference in either improving or maintaining your customer experience.
Not only is it important for your firm to collect feedback, but it is also important when you collect feedback too. Feedback is often being sought too late in the process. It’s either at the close of the matter, or sometimes during, but there is a majority of feedback that isn’t being collected at the beginning of representation. Why is it important to collect data at this time you may ask? Because you want to know why someone hired you in the first place. That’s how you can determine how to improve your marketing in the future, or how you can determine what factors are influencing your client's decisions.
One of the easiest methods to use to gauge client satisfaction is the net promoter score. It is one simple question, where on a scale from 0-10, where ten means “extremely likely", five means “neutral,” and zero means “not likely at all,” would you recommend your law firm to others? This simple question provides powerful insight, and with this information, you can figure out who your “promoters” are (the people who will most likely bring more matters to your firm), and the detractors (those who will not). Giving your clients this easy, straightforward type of survey will allow your firm to maintain relationships when they’re going well, or pivot and adjust when a client is unhappy before it’s too late (and in some cases prevent malpractice). In general, firms that focus on better client service have higher revenue growth, higher profits per attorney, and higher client retention.
Outside of cost, the factors that impact the likelihood of your firm being recommended are the ease of understanding case expectations, the personality or your attorneys, and responsiveness to email, phone, and text. Now that you just read that, what is the one trend that is consistent between these three things? Communication! Your firm's ability to understand who your client is, how they digest information and their expectations of you are all things that can be collected at the start and throughout the cycle of a matter. There are many things that are out of your control, but these factors are not.
In a study by BTI consulting, of the participating clients, 80% of clients expected immediate response to texts and emails. But don’t worry, immediate in this case meant between 1-2 hours. Unfortunately, when firms were evaluated, attorneys considered immediate to be more between 4-8 hours. Within that big of a time discrepancy, we know a few things can happen; clients can get anxious, impatient, and lessen the likelihood of referrals post-matter. The simple solution to this is setting communication expectations early on. Let your clients know what the average time for you to get back to them is so that they are not left wondering if you’re ignoring them. Although you may be juggling many clients at once, the goal is to treat each client like they’re your only client.
This responsiveness also can be translated into how successful your referral business is as well. When people are searching for representation, oftentimes, it is the firm that responds to their call or email first that wins the business. Not only are these firms setting the tone right off the bat, but they are also making the client feel prioritized which is a huge factor that leads to converting potential new clients into billable clients.
In an ABA Benchmark study on intake process, they found that 42% of the time law firms would take three or more days to reply to a voicemail or web-generated form from a prospective client. That is a long time! You spend time and money trying to collect new leads, yet when they come in, firms are still slow to capitalize by responding inefficiently. The same goes for responsiveness over the phone! 35% of callers to a law firm didn’t get to speak to a person and 50% of voice messages left were only returned within two days, while many weren’t returned at all.
All of this information on collecting client data and communication rates are great. But, there are two things when it comes to marketing that you cannot do. In simple terms, you cannot lie about your firm or your services (which should go without saying), and you cannot pressure prospective clients to hire you.
When it comes to advertising, you are by all means allowed to pay the reasonable costs of advertisements or communications, but you may not compensate, give or promise anything of value to a person for recommending the lawyer’s service.
To either create your brand or maintain an existing one, the first step starts with information. This information should be collected both internally and externally. For your potential new clients, you should be asking who your target audience is? What do you know about them? What trends can you identify? Internally speaking, you should be asking how your staff views the firm, where would they like the firm to be in the future? If what your staff says internally differs from what the outside world says, then you have identified a gap that must be bridged. This bridge will be created by your brand and if deployed effectively, will pave the way for expansion and growth.
Courtesy of DeSantis Breindel
In addition to identifying your brand, you must also identify the differentiators or pillars on which to build that brand. The underlying challenge with this is you must be able to distinguish between required characteristics (things that everyone in the industry must have), and those features that are specifically unique to you. The purpose of your brand, will not only serve as a differentiator but also as an anchor through times of turbulence. To determine what differentiates you from the rest of the field, you must dig deep, these core values go beyond the surface level and require industry-wide analysis and research to fully understand what your value proposition is compared to your competitors.
Requirements are simply the elements that most legal brands have already. For example, “an experienced team,” or “unparalleled client service.” These things are the “obvious” essentials you need, but in 2020, they won’t set you apart.
Neutral factors are attributes that are not necessarily good or bad, and they will most like differ from firm-to-firm. Have you been operating for over 50 years? Is your firm woman-led? These things are all great, but when you ask if they were the tipping point for clients when they made their final decision between your firm and another, the answer is most likely not.
These issues (whether it’s one or many) encompass the challenges your firm faces that a brand may not be able to address. At a point, your brand will act as a stabilizer, but if you’re experiencing turmoil, like attorney turnover, malpractice, or even if you have a handful of clients who are unhappy, your brand can only go so far to counteract that. Make sure before making a push to identify your value proposition, you mitigate as many of these issues as possible.
Everything about your firm's brand is important. The way your attorneys present themselves, how your firm sounds as a whole in publicly distributed communications, how cohesive your strategy is, and your positioning across the rest of the industry.
One of the first things we discussed was data. In today’s world, a firm's ability to collect, process, and then utilize information will be the difference between a successful and unsuccessful firm.
Marketing is important, there is no getting around that, but if you cannot create reports and analyze how your efforts are being translated in the real world, you’re wasting your time, not to mention your money.
The ability to group important reports, set security measures, track client data along with monitoring revenue are 2020 musts. Reporting gives you the ability to make better business decisions. It allows you to hone in on where you should be spending more or less of your funds, and it provides a deeper insight into how your firm is viewed both publicly and internally.
For prospective new clients:
For current clients:
The benefits of having all or even just one of these tools is priceless. Utilizing practice management software can allow you to automate the intake process. For example, if you have an intake form on your website, you can integrate that with your software so anytime a PNC fills it out, you are automatically notified on the back end. This streamlined communication process allows you to get to PNCs faster than your competitors.
As discussed earlier, it is important to know where your PNCs are coming from. Some software allows for marketing attribution that accomplishes just that. To go one step further, some programs allow you to customize conflict check reports to include only information that’s important to your firm. The ability to drill down on specific data is becoming more and more crucial, and utilizing tools that allow you to do that will drive your client experience and your referral numbers.
If money talks, then why are so many lips sealed at firms when it comes to discussing billing? According to the 2019 Legal Marketing Association’s annual meeting, “only 49% of law firms are teaching their attorneys how to talk to clients about pricing.” That’s over half of firms out there. Although it’s a puzzling revelation, it’s not altogether surprising. There are a variety of struggles law firms face when it comes to finding that sweet spot in legal billing. Everyone wants to keep the books balanced and income regularly flowing in at a rate owners are pleased with – it doesn’t always happen, but with today’s technology, it’s definitely doable. It’s all about finding the workflow that works best with your staff and clientele.
To truly move your legal billing into modernity, you must embrace everything that organized processes, technology, and automation has to offer. In this blog, we’ll be identifying the common pieces that firms struggle with when it comes to billing, and what modern tools you’ll need in order to accelerate your monthly billing cycle to get paid faster and more regularly.
Legal billing challenges commonly stem from an overburdened staff who are pulled in different directions and activities that don’t generate revenue. There’s no one single cause to why this happens – it’s the combined day-to-day bustle of sending out invoices and client onboarding that are likely the common culprits.
The bane of every legal assistant or billing staff's day is the dreaded double work. Perhaps you have an Excel spreadsheet of client expenses that isn’t synced with your existing software. If you have clients fill out physical paperwork, your staff has to file the papers while entering it into whatever digital system you have. Sure, you may have V-lookup or some other formula that appears to save a few minutes, but if they’re re-entering information multiple times, it’s not making much of a dent in the long run. That time lost is ultimately hurting your bottom line and keeping everyone from controlling scope creep. You can get time back with an effective software that integrates with your everyday systems and enters data everywhere you need it the first time.
The cost of not communicating the billing process to clients upfront can add up. This will inevitably lead to an invoice sent – perhaps with a vague or unfamiliar itemization – causing a client to call upset, misunderstanding what was billed and why. Whether you’re billing hourly or a la carte, to keep clients happy, many firms are pressured to write things off and undercut themselves and the firm. Think about it: if you got an unexpected bill in the mail you weren’t informed about, wouldn’t you also be upset? The more transparent you can be about the legal billing cycle, like bi-weekly or monthly according to work completed, your clients will be happier for it.
The increased demand for clients to be billed in alternate ways from hourly has led to the creation of the Uniform Task-Based Management System (UTBMS). For flat fees, subscription, or project-based instances, using these billing codes provides transparency to your clients about what exactly is being billed, while simultaneously easing the load on your staff to push invoices through for approval. Taking the guesswork out of legal billing will, by default, help move the process along for everyone involved and create alignment for your staff.
Vague descriptions of billing line items perpetuate confusion and can make a client start to mistrust you and your staff. Don’t give anyone reason to feel out of the loop or like they’re not being communicated with. Many clients feel despondent and lost through their cases – they look to you for guidance and fair pricing. Instead of “Consult call: 30 minutes,” consider something like “Reviewed case details for next month’s deposition.” If your billing areas are easily categorized, labeled by date, with the aforementioned line item, your client is much more likely to remember and feel the value of what they got out of that experience. We all want to feel like our money is going toward something useful and helpful to us, especially in the form of legal counsel.
When it comes to modernizing your legal billing, before jumping on any technology initiatives, you must first lock in the core billing process itself. This is the foundation to everything that’s automated. If there are bottlenecks and issues in the process, you can expect those same issues to emerge no matter what software or system you implement. Don’t underestimate the power of refining your billing and listening to your staff on where common problems may be lingering. Are attorneys extra delayed in approving invoices? Is there a workaround billing staff have to use that takes longer in order for it to be done right? A billing workflow is meant to be as simplistic and efficient as possible. Here’s how you can make your billing just that:
With a robust legal billing software like Centerbase, your staff will be able to create time entries for expenses while staying in the programs they work in every day. Programs such as Microsoft Word and Outlook can be easily tracked per matter – making the accrual of time and expenses when it comes to billing an absolute breeze.
Cut down the amount of time spent waiting on bill approvals by generating pre-bills. The ability to electronically distribute pre-bills to staff can speed up your firm’s pre-bill approval process by 30%. As soon as a pre-bill is approved, it’s sent to the next reviewer in order to move things along.
Automated invoices can pull services rendered from a custom frame of time. For example, if a client is billed bi-weekly, an invoice can be automatically created with all the services rendered within a certain date range to be delivered to the client. All the minutiae between – the manual entry, cloning of templates – are no longer needed. You’ll find those minutes back in peoples’ days really adds up.
Having an easy payment system is just as important as presenting a clear bill of services rendered. That smooth process will really speak to convenience and professionalism – two things clients expect out of firms nowadays with the “get it now” society we live in. A compliant integration to software such as LawPay lets you send bills directly to clients’ email inboxes, meaning they can pay electronically within moments of receiving.
Satisfy the itch for data with productivity and budget reports to see how you’re doing with a new technology system in place. If you can track it, Centerbase can report on it – your billing can be laid out however you need it to with custom reporting and tracking in place. This gives you the transparency to make big business decisions when it matters most.
It’s time to bring your systems into the digital age – safely and efficiently, of course. The mere presence of practice management software isn’t going to solve all your problems, but if used as a means to improve existing processes, it will help move your legal billing into considerable modern efficiency that helps you get paid on a cadence that works best for you.
It’s time to talk about pricing with your attorneys and ensure everyone’s on the same page about billing throughout their case. The combination of communication, clear invoicing, and automation are sure to deliver top-tier results that create lasting rapport and trust from your clients.
Have a question about legal billing? Be sure to let us know in the comments, or schedule a no-obligation demo to see how Centerbase can help you get paid faster.
If you had to guess what one emotion is elicited when lawyers are faced with the ability to adopt new technology, what would you guess?
If you guessed hesitancy then you’d be right. When it comes to advancements in new technologies, that emotional resistance has become almost an expected response for the legal industry, and it isn’t without justification. The importance and sensitive nature of matters handled by attorneys prove reason enough to proceed with caution before diving headfirst into the unfamiliar tech waters.
However, whether firms want to believe it or not, the water is warm and because technology has transformed the capabilities of attorneys in rendering legal services, attorneys and firms that fail to embrace new developments risk depriving their clients of the most effective representation possible. With the level of competition we are seeing today, firms have no choice but to modernize the way they practice.
If you take a stand back and look at the legal landscape and where it has evolved from, there are undeniable trends that in some ways, have pushed firms into modernization (whether they were initially willing or not). The explosion of legal technology and improved service delivery models have evolved our use of big data and have led to the digitalization of billing, the automation of client intake and matter management, and ultimately has increased firm's ability to close out cases at a much faster rate. However, demand is rising faster than available resources can accommodate, and firms are faced with a level of strain they haven’t seen before. Automation, workflow management, and legal software are easing the pressure, but the adoption of these resources is still slow to catch on. The boundaries of many legal functions within a firm are expanding, and these trends are calling for a few things: new processes, new skills, and new approaches. Unfortunately, fewer attorneys are equipped to thrive in this environment, which is resulting in the isolation of many traditional law firms.
Before we dive deeper into how firms can combat the modernization of the legal industry, it is important to understand what is driving these trends. In one word, it’s data. 10 years ago the driver was globalization, but now with the proliferation of information consumers have access to, it’s clear that data rules. These quantifiable metrics have no boundaries and they certainly transcend jurisdictions. We’re in a consumer-centric world now, and the only way to keep up with the people you serve is by knowing what they want. And you do that by looking at the numbers.
So what exactly is a modern law firm? Why are they different? Do they really embrace new strategies and methods? Let’s find out.
The definition of ‘modern’ is to relate to the present or recent times as opposed to the remote past. As new technologies are released and new things are discovered, firms have to be willing and able to grow and adapt to these changes. A firm's vision and objective must be clear in order to overcome challenges that will prevent you from keeping up with the rest of the world. And more importantly, how your clients expect your services to be rendered. As the pace of society continues to speed up, and expectations are increased, younger attorneys don’t have time to waste on processes that could be simplified and made easier. Today, it is about more than hard work, it’s about innovation, creativity, and providing a level of top-notch service that cannot be found anywhere else. To be a modern firm, you must rely on data and technology because that is the best way to serve your employees and clients in this new world.
The Greek philosopher Heraclitus was quoted by Plato as noting that “everything changes and nothing stands still.” From one generation to the next, we continue to see a divergence from what used to be popular in culture and technology to the “next best thing” or trend. What was once a gold standard business procedure for Baby Boomers or even Millennials, is now obsolete or antiquated to Gen X-ers. This age gap can lead to misunderstandings and disconnect between younger associates and more senior attorneys. Recruitment is a top priority for firms, but it is also one of the biggest pain points. If management can’t understand the technologies the talent they are trying to recruit is using, or if they won’t come to terms with the reality of these differences, newer attorneys will find a firm that will. Understanding and taking steps to adopt these technologies will not only bridge this gap but will make your firm more agile and lean.
Poor communication is often cited as the biggest factor that leads to client complaints. Similarly, a lack of communication within your law firm is just as detrimental, not only for efficiency but for accuracy as well. Innovation, collaboration, and calculated risk are paramount to a successful firm, and with the prevalence of conferences, virtual meetings, and online and in-person communities, firms have started to recognize the benefit of coming together to share real data. As the industry continues to evolve, these communication channels need to stay open and attorneys need to make use of their time and their client's time. In a world that is always on the go, clients expect fast responses to their questions and routine updates on their cases. There are now technologies that let you privately send and receive texts and calls from your phone while simultaneously tracking and billing for that time automatically. Software like this function to make your life easier. Not to mention it helps you make more money. It’s a no-brainer, and although adoption and technology training may seem like an uphill battle, the benefits of utilizing it at your firm far outweigh those initial burdens.
There is a significant gap today between companies that have adopted (and understand) Artificial Intelligence (AI) and its potential advantages and those who do not.
Savvy law firms are also savvy businesses. They embrace AI to perform repeatable tasks and to process data that is essential for their business campaigns or strategy. Firms also adopt AI to streamline existing business processes, and they have established solid management support for each AI initiative. For example, you can automate your case management to get your bills sent out faster. By creating a workflow, software can automatically assign or complete tasks for you. This should be a no brainer! Letting traditional ways (looking at you paper people!) go is hard, but if you have a smartphone (as 81% of Americans do), then I bet you adjusted to that technological jump in 07’ just fine!
Despite high expectations of AI, statistics show only 23% of businesses have incorporated it into their processes, product, and service offerings. The AI industry and technology involved are surely new, but it is crucial for any business or firm that wants to do better now and in the future to look into it.
When you think of marketing and online presence, law firms, or even the legal industry as a whole, probably don’t come to mind. Due to the nature of your work, there has never really been a need for a heavy emphasis on brand positioning. But as we enter this new digital society filled with digitized and remote work, that is beginning to change. We are in an age where everything is and can be found online. Because of this, it is essential that your firm meets the needs of clients who are moving to online resources to help craft their decision making. Everything from your website, your blog, and your social media profiles are essential for the modernization of your company. With the internet, your website is probably the first contact between your audience and your firm. And if we’ve learned anything from our days sitting across that oak desk at law school entrance interviews... First impressions are everything.
Every element of a well-designed website is carefully planned, executed, and updated when need be. A modern firm knows that their clients are on the internet, which means if you’re not, you’re behind. At the end of the day, if your site doesn’t accurately reflect your firm, it might be time to take additional steps. The clients you will one day serve are the millennials who are currently fully immersed in technology. To win their business you must be aligned with their needs.
Implementing these strategies will not happen overnight. They will require time, resources, and commitment. But, if you want to stay competitive, you must make it a priority to modernize your business, otherwise, your days of competitive advantage will soon be over. It is only a matter of time.
One of the biggest takeaways from 2020 as a whole has been adjusting to the entirely remote atmosphere of day-to-day operations. Although 77 percent of attorneys regularly work from home according to an American Bar Association survey, there’s no doubt this rapid change of in-office vs. a remote environment has affected the ways things are done at law firms. Specifically, how communication happens. Now, moving forward, it’s time to take charge and find ways to use law firm communication tools that prioritize security and efficiency for everyone involved – including clients.
This operational efficiency will serve everyone better in fostering a client-centered firm that maintains clear, iterative communication, positioning your firm’s reputation better than the competition.
Both internal communication and client communication are forever changed. While the outskirts of remote work and the digital age have been creeping in the periphery for a while, it’s the coronavirus that’s ushered in the necessity for fully digital communication and remote work. This has changed mainly for in-office workers such as paralegals and legal assistants. Instead of a quick walk over to your coworker’s desk for a question, you're now forced to send a message or phone call. This extra effort leads to more barriers that can prevent alignment across the team.
For clients, without a central office phone number to call, it’s going to create extra worry about how to get updates on their case. Without clear communication and guidance, your firm’s reputation could suffer. After all, poor communication is among the top reason clients end relationships with law firms. When comparing one bad experience to more than one in terms of communication, the percentage of a client switching to a competitor jumps from 50 to 80 percent.
You really can’t afford to let clients leave on the basis of bad communication – especially since there are so many solutions that can help remedy this prevalent communication problem.
Stay on task and on schedule with frequent communication tools that ease the burden of sifting through multiple windows and programs. One prominent example, which fans of kanban project management will rejoice at, is Centerbase’s TaskFrame™ inclusion. It’s a convenient visual board that lets you drag and drop important tasks and notify people in real-time.
There are plenty of other law firm communication tools that simplify and prioritize what needs to be done in a secure way. Let’s review them based on category:
Creating one spot to facilitate quick communication helps drive efficiency in the digital, remote world we’re now in. It’s easy to keep a tab open as your staff are checking their inboxes or reading a matter to reply back to a quick inquiry.
In terms of messaging, here are some convenient options that can boost your team’s communication:
Whether you need to send matter deadlines or an update via text message, having a simple client portal where it’s all laid out gives considerable peace of mind to clients. This as a law firm communication tool has value when it comes to tracking and divvying direct communication that helps reassure them you’re on top of status updates and important dates to be mindful of.
A 24/7 portal fosters an open door policy and can help clients maintain trust with you during the entirety of their case. Plus, instead of calling, clients can send a message instead about any questions they have – alerting you, and empowering staff to get them answers quicker than playing phone tag.
Onboarding is always a pain point for firms – to get all the paperwork loaded into the system quickly and accurately is timely and takes away from other revenue-generating tasks. Rather than manually entering all a client’s information once they fill out a form, with Centerbase, their information is automatically populated the instant the form is completed. These intake features boost productivity and efficiency on matters.
The better your communication, the more alignment your team will have to stay efficient and keep clients happy. As mentioned earlier, one bad interaction can be the difference between a client going to another firm – so it’s a matter of maintaining a good reputation in order to retain clients. You can have a stellar team of attorneys, but without proper client communication, it will create uncertainty and a lack of trust in the client-attorney relationship. With the advent of digitized and remote teams, your firm must adapt, or you may suffer from a lack of client retention.
So you know the importance of law firm communication tools; now is the implementation step that can feel daunting and overwhelming. Take time to research and plan which of the above services will best suit your firm’s needs, and work on a plan to put it into action if you haven’t already. This will require a virtual or in-person meeting with your team to emphasize the requirements, and why it’s needed. Such a transition can be the difference between your firm flourishing and simply skating by.
Remote work efficiency is going to take a different form when it comes to office communication. Be sure to be mindful of roadblocks – as this transitionary period from a fully staffed office to a hybrid or even fully remote environment can take time to get used to long-term. These video and instant messaging tools can help bridge the gap and get answers and efficiency better than constant calls or text messages on personal devices. Division between work and home is going to be pivotal to helping your team not feel overwhelmed.
What tools jumped out at you? Be sure to let us know what’s best for your team in the comments. If you have any questions about how a mobile app can help your firm and sync with software securely, send us a message, and let’s chat about how Centerbase can simplify everyday tasks and put more time back in your billing and day-to-day operations.
Thanks for tuning in! If you have some time, check out our blog on Everything You Need to Know About Communicating With Your Clients Via Text: The Good and the Bad
Do you want to hear some scary facts? In 2014, 500 million Yahoo users were compromised. In 2016, 57 million Uber customer accounts and profiles were breached, and in 2017, 143 million social security numbers were stolen from Equifax. Breaches to this scale may not happen every day, but smaller ones do. And as the prevalence of cyber threats grow, smaller companies are now being targeted at a much higher rate.
Between January 2015 and December 2016, there was an approximate 2,370% increase in identified exposed losses. Email scans were reported in all 50 states and from 2013-2016, the Internet Crime Complaint Center reported exposed losses of more than $2 billion. As privacy concerns continue to grow, governments are now instituting laws that require companies to report every incident of hacking and data breach.
Let’s take a look at the threats your firm faces, the obligations you have with your clients when you communicate through text, and how to protect yourself while you communicate in today’s day and age.
According to a Legal Technology Survey Report that the American Bar Association released in 2016, more than one-quarter of firms with more than 500 lawyers admitted they experienced some type of breach. Approximately 40% of those firms reported significant resulting business downtime and loss of billable hours. 25% recounted hefty fees to correct the problems and one in six reported loss of important files and information.
Today, 25% of all law firms have been subjected to, or experienced, some form of a data breach involving hackers. Computer-oriented crimes span a wide variety of actions, intentions, and goals, and no company is too large or too small to be affected by a cyberattack.
So why are firms being targeted? Lawyer’s handle very sensitive information for their clients, intellectual property, financial information, and legal strategies, all of which are incredibly valuable for malicious third parties.
As this continues to become a problem, rules that govern the legal industry are changing. Let’s dig deeper.
What are some of the challenges that law firms face?
Unfortunately, even with the advancements in firewalls and encryptions that we see today, people are the largest weakness in a firm’s security network. Whether it’s due to failure to follow protocols or insufficient training, social engineering hacking is on a rise.
The rise of texting is undisputed. It is our primary means of communication. 81% of Americans are sending and receiving texts, with 27 trillion texts being sent every year. According to Nielsen, on average, Americans text twice as much as they call and for Americans under the age of 50, sending and receiving text messages is the most prevalent form of communication. The need and ability to send and receive communication instantly is a primary reason for the rise of this communication method. I'm sure you're familiar with this; people want what they want and they want it now, no questions asked. Today, if it takes longer than thirty minutes to respond to a text (and even that’s generous!), some eyebrows will inevitably be raised. As this trend has evolved, advanced, and continued its way throughout the 21st century, the legal field has slowly started to capitalize on the advantages of the fast and easy communication style too.
There are three compelling reasons why lawyers turn to texting their clients as a dominant means of communication.
And if all of that isn’t enough to compel you, how about the fact that 78% of people wish they could have a text conversation with a business. You don’t have to be good at math to know that’s a lot of people.
Of course, with all this being said, there are downsides to communicating in this modern and rapid way; those being ethical obligations, confidentiality concerns, over accessibility, record preservation, and simplicity. As the legal field continues to evolve, and texting becomes more and more commonplace, there is a framework of rules that all lawyers should abide by as they continue to utilize this form of communication. Doing so, will not only enhance your customer experience but will also protect everyone from malicious third-party threats.
As a lawyer, you have a duty of competence that you must provide to your clients. Competent representation requires the legal knowledge, skill, thoroughness, and preparation reasonably necessary for the representation.
Back in the 90s, when email came onto the scene, the ABA said that lawyers had a reasonable expectation of privacy in communications made by all forms of email, but they also included that the encryption of emails sent over the internet was unnecessary, despite some risk of interception and disclosure. So twenty-some years ago, you didn’t have to worry about protecting your communications. But in 2020, with the rise of breaches and personal information being exposed, the ABA adjusted its statement to include that a lawyer shall make reasonable efforts to prevent the inadvertent or unauthorized disclosure of, or unauthorized access to, information relating to the representation of a client. Today, it is a lawyer’s duty to keep abreast of the knowledge and changes in the law and its practice, including the benefits and risks associated with relevant technology. Now, all lawyers are required to act competently to safeguard information relating to the representation of a client against unauthorized access by third parties and inadvertent disclosure of information.
The first thing every law firm and lawyer must be able to do is to understand the nature of the threat. Being able to identify what kind of threat is being imposed will help you determine how you should communicate with your staff about combating it.
Not only should you be able to understand the potential threats, but you should also have an understanding of how your confidential information is being stored and transmitted. How does your firm store information? Are you cloud-based or on a physical hard drive?
Next, you must know how to use reasonable security measures to protect what you’re communicating with your clients. This means you also need to determine how your electronic communications and client matter is being protected. It goes further than your IT department making a unilateral decision, it’s your responsibility to make the decision to protect your clients.
Lastly, firms must train their lawyers and staff in technology and information security and conduct due diligence on vendors providing communication technology. This includes how vendors process and handle your data, whether or not it complies with your ethical obligation, vendor conflict check, and understanding how they do business. Additionally, it is important to note whether or not these vendors are storing your information overseas, what jurisdiction they have over that data, and in the event of a breach, what are the steps to mitigate or resolve the hack?
The factors to be considered in determining the reasonableness of lawyers efforts include:
As you move forward and continue to grow your firm and expand your client list, it is best practice to speak with your clients and discuss their expectations for communication. What suits them best? Are they comfortable with communicating back and forth via text and are they aware of the security risks and threats in today’s day and age?
Simple answer, yes. You may send texts to and receive texts from clients. There are no statutes prohibiting this, however, there are regulations around data security and confidentiality as mentioned above.
If you’re trying to solicit new clients via text there are some standards you must follow. For example, the first line of your text must say that what you’re sending is an advertisement. You must track who received the texts and what content they are specifically receiving. You must ensure that the prospective client is not responsible for the data costs by working with cell phone service providers and you must have a method for prospective clients to opt-out.
If all that sounds like a hassle to you, consider this: the average open rate for text message campaigns is 98%, compared to a 20% open rate for email campaigns. SMS response rates are 295% higher than phone call response rates and 75% of people wouldn't mind receiving an SMS text message from a brand if they opt-in for the service. All this data leads to the undeniable fact that texting yields the highest rate of response.
The information you handle every day is critical, because of this, firms all across the US are at risk. Any firm relying on existing non-secure messaging systems to communicate with clients is putting themselves and their clients’ confidential information at risk.
In today’s world, protecting yourself, your firm, and your clients is critical. Here are some basic measures and steps you can take to protect yourself.
To learn more, check out our blog, Data Security for Law Firms: Everything You Need to Know
There’s no limit to people in need of legal counsel at any given time. In fact, according to a U.S. Consumer Legal Needs Survey, 74% of prospects searching online end up contacting a firm by phone. Is your service going to reassure them you’re the right fit for their case? That’s why a client-centered law firm is so important in today’s world.
In a customer-centric, get-it-now world, it’s no surprise the expectation for a client-centered experience at law firms has become a bigger conversation in recent years. What does it actually mean to create a meaningful client journey in today’s digital environment? While you may be thinking – “of course we’re client-centric at our law firm!” – this is about more than prioritizing clients or sending them an update. It’s about baking client-centricity into everything you do. In day-to-day interactions, from onboarding to closing out their case, they need to know you’re there for them.
In this blog, we’re going to discuss ways to support a client-centered law firm in every aspect of your business, and why it’s important to do so moving forward to stay competitive and profitable.
Understanding a client-centered law firm is more of a line of thought versus a single line item to check off your list. Think of a client-centered model as a shift in the way you approach processes in your firm and how it’s run to be about the client in everything you do. While you may think you already do this, it’s a pretty big shift when it comes to your people and technology. It’s thinking about their experiences before making big decisions and adapting your technology to create a smoother, more transparent time during their case.
The purpose of a client-centered law firm, and why many firms have moved toward it, is to set themselves apart and be more competitive. In a world of thousands of attorneys in any given area, this can be the “wow factor” that’s the difference between a client going with you vs. someone else.
In the age of instant gratification brought on by same-day grocery delivery and Amazon Prime, people want what they want – and fast. Waiting for status updates by mail is no longer a feasible option to stay competitive in lieu of the internet and other legal services instantly available. People get answers right at their fingertips in seconds for their bank statements, credit cards, Uber rides, and more. That expectation has, by proxy, bled into the legal industry, creating the need for a client-centered law firm.
Think of yourself as a customer for a moment. You expect ongoing communication and respect. You want to be treated like an equal. Apply those same principles to your legal services, and you’ll check all the boxes of what a client is looking for. Most times, clients are under duress and are coming to you for guidance and help. Rather than being callous or pristine, show them they’re heard and actively listen. After all, they know their case best. As an attorney, that initial contact via phone or in-person can make all the difference in whether they choose to hire you or not. The same can be said for your staff.
So, this all seems great in theory, but how exactly can this get implemented in between all the bustle of daily operations?
The most effective way to implement a client-centered law firm is to zoom out and see the entire journey of a case from the client’s perspective. Running through this from start to finish can identify where you may have gaps or get muddy in terms of the communication and mindfulness we previously mentioned.
Here are a few tips to help:
From the origin of a client’s legal issue to paying their bill at the end, your client’s journey is defined as every step of their case from their perspective. There’s usually a substantial difference between what you see of their case and what they’re experiencing and living while everything is unfolding.
Is there a workflow anywhere in your legal tech outlining the client's journey? This can be a great starting point to help you assess where there may be shortcomings or delays.
No law firm is perfect – there are always ways to run a client-centered firm and improve upon existing processes. While it may never feel like the “right time,” consider blocking out an hour a week to push aside distractions and focus solely on putting yourself in your client’s shoes. Over time, this can create massive improvements in their experience or all the touchpoints concerning their case.
To refine your customer experience, ask yourself a few questions about your firm, such as:
Smoothing out the process can boost satisfaction and faith in the process itself.
You can implement everything you want to help clients, but if there’s no way to measure success or gauge satisfaction, you might as well be working blind. Using a Net Promoter Score (NPS) to measure customer satisfaction can be invaluable if you’re stuck in the previous step of “I don’t know what I don’t know.”
For clarity, a quick survey or matrix can be 3-5 questions asking for recommendations and a 1-10 sliding scale for satisfaction. Finding the average of responses, and measuring this over time, can give you a KPI on how a client-centered approach is moving the needle.
Now you know why client-centered law firms stay competitive and are an important part of the changing landscape in the legal industry. Now you need to know the actual structure and pieces needed for it to work: the people and technology aspect. After the plan and big picture, steps are in place, now it’s about running and maintaining the system. It takes a strong, communicative team to make it all happen, so remember – how you treat your team will reflect and trickle down into how clients are treated.
Isolating your thoughts can quickly become an echo chamber. If you’re a managing partner or attorney, be sure to ask for feedback from your other employees regularly since you’re not on the ground level working with clients most of the time. Every month or quarter, send your employees a survey or meet (digitally or otherwise) to hear their thoughts. Chances are, they’ve been itching for an opportunity to voice concerns, especially when the day-to-day can take over.
It’s easy to have short-sightedness when it comes to goals – everyone wants the low-hanging fruit and the small wins to come quickly. But that won’t help when clients feel unheard, or you’re not able to return calls and help increase onboarding as goals, for example.
Building a client-centered firm means always thinking “how does this affect the client?” first and foremost will help keep them top of mind when it comes to the customer journey. Tie that into its own KPI, or verbal note during every budget meeting. Have a few minutes baked in for suggestions and ways things can be improved.
When it comes to client centricity, as you’ve learned, they’re at the core of every business process and decision. That means during in-person meetings, make them feel comfortable and, if possible, carve out extra time in case you need to listen to clients for longer than the allotted time. These little gestures can show you’re committed to going above and beyond them long after they’ve signed the dotted line.
The legal industry, at its heart, is a people business, built on helping others and bringing to justice for those who have been wronged. Remind them of that with every update and movement of assistance you provide.
This may feel daunting like there’s never enough time in a day to get it all done. We get it. That’s why many firms have turned to practice management software to do some of the legwork for them. By using expedited billing and workflow automation, you can get minutes back in everyone’s workday that adds up to something incredible: the ability to offer exceptional service to your clients.
Centerbase can do all of the above and more for your firm.
To recap, by mapping your client journey – or their perspective of a case from inception to their last bill payment – you can stay competitive and create a positive reputation that earns more referrals and business. By keeping an open line of communication between your staff and clients and rating the satisfaction over time, you can pave the way for a truly immersive, client-centered experience in all your big business decisions. How’s that for staying competitive in a digital, software-dominated industry? Staying profitable and efficient are the two hallmarks of a client-centered experience that all work together to bolster success
Staying efficient with updated software can give you the secret sauce to ensure all of it happens every day. If you’re interested in learning more, feel free to contact us or read our resources library for more about how Centerbase can change the game for your firm.
If you missed it, check out part 1 to this blog, The Business of Law Part 1: In the Age of the Consumer.
