Cost per Case Analysis and Your Firm’s Marketing Decisions

The following is a guest post, courtesy of Deanna Powers, eGeneration Marketing.

There are more than 12,000 attorneys in the state of Oregon. Many firms, particularly small firms or solo practitioners, may not be able to hire someone to handle all marketing efforts. If you’re in charge of marketing for your law firm, it may be challenging to know which channels are most profitable. TV ads usually lead to a lot of claimants calling your office, but is this marketing option overall more profitable than simply spending more time optimizing your firm’s social media pages?  Fortunately, there is a way to accurately compare every marketing venture to one another. A cost per case metric will help your firm make better-informed spending decisions by examining the profitability of all current marketing efforts.

What Is Your Cost Per Case?

A cost per case (CPC) analysis examines the profitability of a particular marketing venture by taking the total dollars spent on that advertising effort divided by the new clients signed because of that effort.

Marketing Effort Budget ÷ New Clients Signed = Cost per Case

It’s unlikely that your marketing channels will all yield the same CPC. Some new clients will have a CPC of $0. This happens when past clients refer your firm’s services to their friends or family members.  This is perhaps the most beneficial marketing avenue for your firm, since it cost you nothing in terms of advertising dollars.

Unfortunately, no matter how strong your firm’s reputation, not all new clients can be signed from referrals. A CPC metric gives you the data you need for a thorough analysis of every paid marketing effort, which in turn puts stronger marketing budget decisions well within your reach. Some profitability can be calculated for you—Google AdWords gives your firm a wealth of data on how your campaigns are performing if you use PPC ads. Unfortunately, non-digital marketing efforts are a little more challenging to evaluate, but the CPC calculation still comes into play. We can use billboard pricing as an example as how you would calculate your firm’s CPC through a traditional marketing channel.

Billboard Ads: High Exposure Generates Greater Leads

When considering marketing avenues for law firms, high exposure is a key factor. Many firms choose to use billboard marketing because it gets you the most views for the lowest price. Outdoor ads have a crucial place in a well-devised marketing strategy according to the Arbitron Out-of-Home Advertising Report, a national survey that examines advertising and spending habits in relation to the increasingly mobile lifestyle of Americans. According to this report, eight of 10 Americans make buying decisions while out of the house and many of these decisions are made in the car. About 75% of travelers see billboards, and about 50% internalize the messages viewed, often later acting on them.

Lamar Advertising, one of the nation’s biggest billboard and other outdoor advertising firms, offers a range of marketing locations in Portland, Oregon and the surrounding communities. Prices vary, based on ad size, location, and whether messages are static or digital, but this means your firm has ample choices for remaining within an established marketing budget. For example, Lamar offers a billboard on Mt. Hood Highway, near Haley Road, which receives more than 92,000 views during an average week. This 14’ x 48’, permanent billboard rents for $7,500 per month.

It’s very hard to know how many clients you’ll sign from a billboard, as the overwhelming majority of commuters won’t need your legal services. Conversion rates for billboards can be as low as 0.002%, and this is simply the number of people who call your firm, not the number of cases you take! You may only think one of 10 claimants who reach out to you have a pursuable case. If you sign a respectable two new clients per week due, your CPC for this example will be $938.

Is This a “Good” Cost Per Case?

Some firms may be thrilled with a CPC of $938, while others will be horrified. It all depends on how much return you’re expecting from your claimant.

If your firm specializes in divorce and family law, for example, then you’re likely to see fees of $10,000 or more per complex case, which would make the spend of $938 for signing a new client profitable. On the other hand, if your firm specializes in Social Security disability law, then the $750 spend might be a bit steep. The average Social Security attorney only receives $3,000 per settlement, with a maximum of $6,000. The profit margins would be too slim for Social Security attorneys to pursue any marketing channel with a CPC that high.

Ultimately, if your firm realizes a CPC of about 15% of the fees earned per claimant, then the marketing effort is considered a profitable advertising venture.

Getting the Facts Needed for CPC Analysis

A CPC metric only works if you have the appropriate data to complete a reliable analysis. With many of your online advertising efforts, you can easily determine how and where clients learn of your firm. When a new client calls or walks through your doors though, you’ll only discover the data you need if you pose the appropriate questions, and the most important one is:

“Where did you hear about us?”

A new client’s answer lets you construct a reliable CPC. This in turn allows you to evaluate accurately your current marketing efforts. It additionally offers the data necessary for developing profitable marketing plans for the future. Regardless of whether you use TV ads, billboards, digital marketing, or are simply working to build a name in your community, calculating your CPC can all you to pinpoint your marketing inefficiencies and invest more into your most successful campaigns.

Deanna Power

eGenerationMarketing

SEO Your Website Using Free Directory Listings

With so many good marketing folks to follow on social media, who should you choose? I previously featured two of my favorites here.  Another great contender is Edmund Yan of Yan Media.

seo

I like Edmund because his posts are concrete: he gives you specific content you can act on now. For example, Free Legal Directories Every Law Firm Should Exploit for SEO.

Boost Your Website Ranking

In this post, which is an update of an earlier piece, Edmund talks about how you can boost your website ranking on Google by creating free profiles on legal directories. You may have heard this before, and true enough some of the directories will be ones you already know like Avvo or Findlaw.  But others were new to me.

As Edmund points out, Google’s ranking system is all about popularity.  Add your link to a popular site and ta-da!  You’re popular in Google’s eyes too.  Or at least more popular.

The more popular you are, the more credible you’ll appear in the eyes of Google and the higher you’ll rank on organic search result pages. It’s that simple.

Read the full post on using free legal directories for SEO here.  At the end are six suggestions for must-include content in your directory profiles.

Why You Should Claim Your Directory Profile Even if You Don’t Care About SEO

Even if you don’t need an SEO boost from online legal directories, you should still claim your profile.  Notice I said “claim.”

Whether you set up a profile or not, I can just about guarantee that Avvo has a listing for you.  The same is true for other popular online legal directories.

  • If you want to control what is being said about you, claim your profile.
  • If you want to remove inaccurate information or scurrilous reviews, claim your profile.

This worked for at least one Oregon lawyer who Googled herself and was shocked to discover a bad Avvo review.  She was shocked because she’d never set up an Avvo account.  By claiming her profile she was able to get the information removed.

Thankfully this experience isn’t a recurring one.  Nonetheless, this is one lesson that many lawyers have yet to learn: you need to control (and know) what is being said about you on the Internet.  You may have Google reviews, Yelp reviews, Facebook reviews, or other reviews you don’t know about.

Set Up Alerts When Your Name is Mentioned

A good place to start is by setting up Google Alerts for your name and your business name.  This allows you to receive an email anytime you or your business is mentioned on the Web.

You may also want to try some of the alternatives to Google.  In recent years users have complained that Google Alerts wasn’t working as well for them.  Some prefer Yahoo! Either way do something to learn what is being said so you can take better charge of your online presence.

All Rights Reserved Beverly Michaelis 2017

The Ethics of Social Media and Online Marketing

Last weekend the Oregon State Bar held the first ever Solo & Small Firm Conference in Bend, Oregon.  The lineup included nationally recognized speakers and Oregon-based experts, including the incomparable David Elkanich of Holland & Knight.

David gave two great presentations at the conference, and I promise to blog about both. Today I start with a subject near and dear to my heart: The Ethics of Social Media and Online Marketing.  Here are a few tweets to give you the flavor of David’s presentation:

A complete compilation of David’s tips can be found here.

Over the next days and weeks I will share other gems from the conference, including “best of” tips from:

  • Exchanging Documents Electronically
  • How Clients Can Win with Your Small Firm Resources
  • Tame the Digital Chaos
  • 60 Legal Tech Tips
  • and more!

All Rights Reserved 2016 Beverly Michaelis

The Ethics of Crowdfunding, Revisited

When we last visited the subject of crowdfunding in January, I pointed out some of the ethical barriers to this method of fund raising.  While much depends on the lawyer, crowdfunding could implicate:

  • Improper communications concerning a lawyer’s services – Oregon RPC 7.1
  • Dishonesty, fraud, deceit – Oregon RPC 8.4
  • Fee sharing with a nonlawyer – Oregon RPC 5.4

I also noted that money raised via crowdfunding may well be taxable, even if the lawyer did not meet the minimum threshold to trigger a 1099.

This month I join forces with the venerable Amber Hollister, Assistant General Counsel of the Oregon State Bar.  We have co-authored an article for the OSB Bulletin entitled “Crowdfunding Your Law Practice.”  The article is scheduled for publication in the May issue.

In addition to the above, we identified other troublesome ethics concerns:

  • Potential third payment and trust accounting issues – If you are rewarding donors with a legal consultation in exchange for a donation and receive funds in advance or a donor is construed as “buying” a legal consultation for a third party, be sure to comply with all trust accounting rules.
  • Conflicts of interest are also a concern.  If a consultation is offered as a “perk or reward” in exchange for a donation, will the lawyer be able to perform?  Lawyers would be well-advised to forewarn donors of the necessity of conflict screening.
  • Running afoul of the rule prohibiting the lawyer from giving something of value in exchange for recommending the lawyer’s services – lawyers can’t give enthusiastic donors anything of value for promoting the lawyer’s crowdfunding campaign via social media.

None of this is shared to discourage Oregon lawyers from crowdfunding.  Rather, you need to go in with your eyes open and be sure you are tuned in to the ethics issues.  For a thorough analysis of this subject, refer to the article.

[All Rights Reserved 2015 Beverly Michaelis]

 

Evaluating Online Lawyer Referral Services

Online referral services can be a good source of business for lawyers entering private practice.  And the pitch is often tempting:  “Sign up with us and you’ll get all the clients you want in [your practice area].  You will be the only lawyer in [your state] to receive referrals from us.”  Scads of clients.  Exclusivity.  Sounds good, doesn’t it?

Bar-operated programs aside, you should take the time to scrutinize offers from for-profit online referral services.  Potential traps abound:

Fees

Paying a fixed annual or other set periodic fee not related to any particular work derived from a directory listing violates neither RPC 5.4(a) nor RPC 7.2(a). A charge to Lawyer based on the number of hits or clicks on Lawyer’s advertising, and that is not based on actual referrals or retained clients, would also be permissible.  Helen Hierschbiel, Internet Marketing: Rules of the Road

The key here is that the fee and the work are not connected.  The typical referral service gets this right, but make sure you understand how fees are paid and what conditions apply.  To learn how you might run afoul of the fee sharing prohibition, see Amber Hollister, What Hath the Web Wrought? Advertising in the Internet Age.

Confidentiality

Odds are you’ll be required to report back some kind of tracking data to the online referral service.  Assuming this includes only benign information, such as a client identification number, there is no breach of confidentiality.  Services vary, however, so learn exactly what must be reported and why.

Advertising

…Internet-based advertising is governed by the same rules as other advertising. The basic ground rule is that advertising cannot be false or misleading. See RPC 7.1(a). Because Web pages may be viewed by persons outside of Oregon, lawyers must take care to ensure the advertisement identifies the jurisdictional limits of their practices. Furthermore, while lawyers may include their names in directories or other advertising Web pages, they must not allow a directory to promote them using means that involve false or misleading communications. RPC 7.2(b). Lawyers are responsible for content that they did not create to the extent they know about that content.  Helen Hierschbiel, Internet Marketing: Rules of the Road.

Some online referrers advertise that the lawyers in their network are “Verified.”  They give lawyer-members “Verified” logos or other graphics to place on their websites.  This begs the question: what does “Verified” mean?  By whom?  How?  When?  Unless this statement is adequately explained, it could be considered false or misleading.

Puffery in numbers

If the online referral service is suggesting you should sign up now because they have a gazillion clients waiting in the wings for a lawyer in your practice area, probe that representation.  Ask for numbers, demographics, and details.  If the clients really exist, they should have the information to back up the statement.  How many clients do they anticipate referring to you each month?  What is the basis for that expectation?  How will they ensure the flow of future clients?

Puffery in other ways

Some online referral services tell lawyers they’ve been approved or vetted by a bar association.  Designed to give peace of mind, this statement is more than a little suspicious.

While a referral service may have done its homework to investigate the rules in Oregon, and may have contacted the bar to learn more about the rules, this does not constitute “approval” of the program.  To my knowledge, the bar does not engage in such a process.

If you are approached by a referral service that implies it has been approved by the Oregon State Bar, contact the Oregon State Bar to verify this representation.

Exclusivity

Some services promise exclusivity:  sign with us and you will be the only Oregon lawyer to receive referrals in your area(s) of law.  You should be especially skeptical of this representation.  Get it in writing and carefully investigate any potential exceptions or loopholes.

General reputation, references, and complaints

Minimally, run a Google search.  Look beyond the first page of results.  Read any articles, reviews, or posts about complaints that mention the name of the service.  The BBB or like organizations can be a good source of information.

Also take the time to check references.  Ask for the names of other Oregon lawyers who have been using the service for at least six months.

Cancellation

Make sure you understand the cancellation terms. You don’t need a nasty surprise if you decide to get out.  Initial set-up fees are likely to be nonrefundable, but check.

Better Marketing

The PLF has an excellent set of marketing practice aids which include a business development goal checklist, sample marketing plan, and marketing worksheets.  Download these resources at Practice Management > Forms > Marketing on the PLF website.

Ask

Many of the issues related to online lawyer referral services are ethical in nature.  Don’t hesitate to contact the OSB General Counsel’s Office when in doubt.

All Rights Reserved [2015] Beverly Michaelis