The legal industry is undergoing a significant transformation driven in large part by heightened competition, cost-sensitivity, and client expectations; dwindling client loyalty; and the introduction of advanced technologies like artificial intelligence (AI) and data-analytics tied closely to the client experience.
Let’s take a look at five key (and evolving) legal marketing trends for 2023 and how they’re shaping a sharp shift towards a client-centric approach, while also highlighting the importance of mapping not only client relationships to drive revenue, but internal firm relationships as well.
Trends in Legal Marketing for 2023
#1 Artificial Intelligence (AI) and Insights
Like in many other industries, AI and insights are shaping the Marketing and BD landscape in law firms by going beyond automation to augmentation. The latter focuses mostly on time-saving and centralization while the former is more about helping people perform tasks not only faster, but also better and smarter. This—augmentation—represents the key to the role AI can play in shaping the legal business.
Insights, then, continue to play an increasingly critical role in driving more effective client acquisition and retention strategies, including more effective and personalized marketing efforts that leverage client intelligence to deliver the right message to the right people, at the right time. In other words, client insights and the intelligence derived from them allow firms to better understand their target audiences and their specific needs in order to better serve them. This serves to sustain greater overall firm health and should not be ignored or minimized.
#2 The Importance of Data Analytics
Sourcing, managing, and activating data analytics in the legal industry to enhance overall business decisions—and Marketing and BD efforts more specifically—has become central to law firms in driving revenue and fostering overall growth.
Breaking down data silos—or bringing all the firm’s lawyers’ contacts and relationships to light and sharing these with Marketing and BD—is a key way to nurture each opportunity and derive the maximum value from the same with the dedicated attention of a professional Client Services Team (CST) versus the fragmented attention of already extremely busy lawyers and partners.
Understanding client touchpoints across the firm further serves to streamline the client experience, driving client acquisition and retention. By leveraging data analytics—particularly client relationship data—law firms can avoid inconsistent or repetitive client touchpoints that can quickly lead to frustrated and dissatisfied clients and instead ensure a stronger, more cohesive experience that makes clients feel less like just another dollar sign and more like a valued client at the forefront of the firm’s attention.
Perhaps one of the most critical functions of data analytics within the law firm environment is using client data that firms already have to help identify potentially untapped revenue in accounts where strong, established relationships already exist. Also known as the “white space,” this is where firms can find gaps in client needs that can easily be filled by their services, but are sitting untouched. We know we talk about this a lot, but it bears repeating: always remember that 80% of your revenue is likely to come from 20% of your clients!
#3 The Need for Greater Automation
The greatest legal team in the world couldn’t do it all to maximum capacity or effectiveness and neither can legal marketers or BD professionals alone. That’s why automation is an ever-growing need within legal Marketing and BD teams that are looking to innovate and enhance the way they acquire, grow, and retain business. By reducing the manual work involved in collecting, managing, and mining the business-critical data required to streamline legal marketing and BD strategies and boost results, firms can save money on manpower while improving data accuracy too.
Because lawyers tend to possess large amounts of key client data that stands to drive successful Marketing and BD efforts, but don’t tend to log into CRMs very often, if at all, greater automation is especially important for maximizing the power of these systems to drive business. By employing a client relationship data platform like Introhive, this task is completely removed from busy lawyers’ and partners’ to-do lists and instead put into the best, most centralized place to help drive firm revenue and growth. These platforms can also help educate lawyers and partners on the benefits of CRM, sharing their data, and running their firms like a true business.
#4 The Role of Referrals and Cross-Selling
Yes, we’re going to say it again here because it’s that important: 80% of your revenue is likely to come from 20% of your clients! It should be no surprise then—that in an ever-more competitive and sophisticated market for legal services—firms and the legal marketers and BD professionals within them need to pay close attention to and expand the role of referrals and cross-selling in their overall efforts to drive revenue and grow the firm. Also important to note is that a once long-standing Rule of Three in the legal industry—that is engaging all clients in at least three practice areas of the firm to maximize account value—is no longer enough and has ushered in a new era for the Rule of Five instead.
When your firm successfully focuses its Marketing and BD efforts and strategies on cross-selling legal services into new practice and service areas, four main factors work together to drive revenue and overall firm profitability:
- First, client loyalty creates both a predictable revenue stream (AKA annuity revenue) and a steady referral stream.
- Second, cross-selling existing clients has been proven time and again to be easier and more profitable than acquiring new ones.
- Third, cross-selling gives firms the opportunity to sell specialized services that are high-margin.
- Fourth, offering tailored services that address niche client needs creates a stronger overall client experience.
Another key tenant of this key legal marketing trend for 2023, is the need to incentivize firm lawyers and partners to participate in cross-selling and referral strategies. Lawyers tend to be rather reserved when it comes to sharing their personal client data—and for good reason. They don’t want to risk potentially complicating or hurting a client relationship they worked hard to cultivate to help a colleague sell a service the lawyer in question won’t necessarily benefit from personally. Incorporating a practitioner incentive strategy into your overall legal marketing and BD efforts helps boost participation. It can also actively educate lawyers and partners on the value of such activities in driving not only firm revenue, growth, and client loyalty, but also referrals back to their own service areas.
#5 The Significance of Relationship Mapping
Relationship mapping—or the process of creating a visualization of the interconnected contacts within your organization—is becoming an absolute must-have in today’s legal marketing and BD landscape. But it’s not enough to just do it—you have to do it well and leverage the right technology to automate much of the work while maximizing the outcome.
Effective relationship mapping within a law firm helps paint a comprehensive picture of your organization’s relationships, keeping your intros warm and wins quick. It can also drive more informed business decisions that set the firm up for greater long-term success. And as deals become more complex and involve more and more people both on the firm side and the client side, having complete visibility into relationships with key players gives you a competitive advantage.
Failing to realize proper relationship mapping strategies can lead to lost deals (the decision is no longer made by any one person), frustrated clients and loss of loyalty, and poor or fragmented communication—all of which will negatively affect firm revenue in both the short- and long-term.
Where do you stand on all of this? What are you experiencing in your own firms that can help further inform and shape the future of legal marketing and how do you see tech playing a growing role?