In the past decade, I’ve worked with over 100 personal injury law firms ranging in size from under 10 employees to over 200 employees. No matter the size, all of them need to know the same information to be successful. As a direct response marketer and client acquisition professional, I’m constantly discussing methods of measuring the performance of firms’ marketing campaigns and client retention efforts.
Lawyers want to know how well their marketing efforts are performing and how efficient their client retention processes are. These questions can easily be answered by building a 4-stage client acquisition funnel and utilizing five data points.
Set Up Your Client Acquisition Funnel
The first task is to set up your client acquisition funnel with four stages or milestones: Leads, Qualified Leads, Retainer Packet Sent Out, Retainer Packet Returned.
Leads: Unique respondents to your marketing who are looking to talk to you about a potential claim and hire your firm. This metric should be void of fake form fills and miss dialed phone calls.
Qualified Leads: Leads that meet a minimal qualification threshold. Every firm has their own definition for this threshold I recommend setting up your scripts with 5-10 initial questions to quickly qualify a Lead. When the minimal threshold is reached, you continue talking to the prospect. If it doesn’t, you kindly get off the phone.
Retainer Packet Sent Out: A Lead meets this milestone when you believe the prospect has a potentially viable case and you want the person to retain your firm.
Retainer Packet Returned: A Lead meets this milestone when a complete retainer packet is returned with a signed retainer agreement.
Being able to track these milestones for each Lead is the key to simplifying your client acquisition KPI’s.
Tracking These Milestones in Your CRM
Once your funnel is established you must set the four stages as major milestones in your CRM. If possible, create checkboxes in your CRM with automated workflows to populate the appropriate checkbox when a lead passes through the associated status. I’ve worked with several different systems and I prefer the checkbox method because many times when a lead is declined during the nurturing process, the lead status is changed to “declined/lost” and the milestone is lost or is difficult to report.
Now that your client acquisition funnel is in place, let’s look at the 5 data points that are critical to measuring your client acquisition performance.
- Spend on marketing efforts by week
- Number of Leads generated by week
- Number of those Leads that are Qualified Leads
- Number of those Qualified Leads that a Retainer Packet was Sent out
- Number of those Retainer Packets that were Returned completed
Marketing KPI’s: Know Your Cost-Pers
Using data from your whole client acquisition funnel allows you to measure aggregated and week-over-week performance using the following KPI’s.
- Cost per Lead
- Cost per Qualified Lead
- Cost per Packet Out
- Cost per Packet Returned (aka Client Acquisition Cost)
Most firms know their Cost per Lead and their Client Acquisition Cost, however knowing the Cost per Qualified lead and Cost per Packet Out has major benefits for your marketing team. It may take weeks or even several months to retain a client and your teams can not wait months to measure performance. They need data quickly to optimize your marketing channels.
The Cost per Qualified Lead and Cost per Packet Out KPI’s accomplish this. By arming your team with short-term quantitative data, you can adjust your marketing tactics to generate higher quality leads.
Operational KPI’s: Know Your Conversion Rates
Every firm should know how many leads it takes to retain a client. However, many do not.
Using the 5 data points mentioned above, you can calculate the conversion rate from Lead to Qualified Lead, Qualified Lead to Packet Sent Out and from Packet Sent Out to Packet Returned. Your operations team will be able to use this data to identify inefficiencies and streamline your processes to retain more clients quicker. For example, if 90% of your leads are qualifying but 10% of your qualified leads are being sent retainer packets then you may want to add more to your upfront qualification questions to eliminate the truly unqualified leads.
The bottom line is, knowing your conversion rates between the four milestones allows you to use data to make your operations more effective and efficient.
About Compass Growth Partners: Compass Growth Partners is a boutique consulting company that helps personal injury law firms accelerate their growth by simplifying, streamlining, and enhancing, their client acquisition processes. We help turn law firms’ leads into clients.
We apply our proven processes and knowledge of lead generation marketing, lead nurturing, and client retention activities to help law firms retain more clients, quicker – accelerating their growth and increasing law firms’ lead-to-client conversion rate by 25%.
Contact: Scott D. Lafferty, Founder & CEO
Compass Growth Partners