At Calibrate Legal, we recently published the 2017 Law Firm Marketing Operations Index — a research study on the maturity of the Marketing Operations function at leading law firms in North America and the UK.
This research makes it clear that law firms have not fully embraced the principles of Marketing Operations, including:
- increasing marketing efficiency and organizational agility
- aligning marketing activity with revenue growth
- measuring activity and people in a systematic way
Although the research reveals pockets of excellence and motivation, law firms, as a group, are not leaders in adopting the Marketing Operations best practices that have been successful in other sectors.
Does this matter? After all, law firms are very different creatures than the technology and consumer goods companies where Marketing Operations originated. Transaction volumes are much lower, sales cycles are less predictable, and arguably, revenue growth is driven mainly by individual rainmakers rather than the organization. In the law firm environment, is it really worth the effort to measure, align and optimize marketing activity and expenditure?
Calibrate Legal believes it is not only worth the effort, but imperative for Marketing/BD departments. The business leaders that marketers serve are motivated to wring the greatest possible value out of the firm’s marketing expenditure. If marketers can’t prove that value over time, they will find it difficult to argue for a seat at the table. In some cases, the Marketing/BD budget may even be reduced or restructured.
Putting it another way: If we don’t have the facts about marketing’s business contribution at our fingertips, the opinions and preferences of individual law firm partners will determine our fate. Marshaling those facts is our accountability.
How can law firm marketing leaders move toward the goal of demonstrating Marketing/BD’s contribution? The answer will be different for each firm, but Calibfrate Legal’s research findings suggest the following as viable starting points:
Experiment with Return on Marketing Investment (ROMI) measurement
The survey revealed that law firm CMOs know that ROMI is important, but few are currently applying it. It may not be possible to calculate ROMI for the entire marketing budget, but at the level of an individual program or campaign it is largely feasible. The key is designing the campaign to achieve a quantifiable revenue goal. For example: create a campaign with the objective of capturing leads for a particular type of matter. Determine a value for the average income that each new matter will generate for the firm. Add up all the costs associated with the campaign, including staff time. Estimate the average probability that each lead will come to fruition.
Then apply a formula. For example:
ROMI = (Net Income per Matter x #Leads x Success probability $% – Total cost of campaign)/Total cost of campaign
Your firm may use a different calculation, and that’s fine. The point is to get agreement with all stakeholders around one methodology, and apply it consistently for all comparable campaigns. Over time you will build up a picture of which campaigns are most successful, and you’ll be able to use that information to plan future marketing budgets – and evaluate requests for new initiatives against their potential return.
Consider adopting Account-Based Marketing (ABM)
The survey shows that most law firms are not organizing their Marketing/BD around their most important clients – those who generate the greatest value for the firm over time. This suggests a possible opportunity for firms to distinguish themselves. Account-Based Marketing (ABM) involves treating individual prospect or client accounts as markets of one, and designing strategies, campaigns and tactics against those markets. ABM has proven a strong connection to revenue growth in many other B2B sectors – perhaps it’s time for law firms to investigate the potential, and for CMOs to take the lead.
Tap into your clients – both internal and external – for marketing insight
Few CMOs, according to the survey findings, are using client satisfaction data to inform their marketing plans. Fewer still have an internal client satisfaction metric for their Marketing/BD teams’ activity. Again, this is an opportunity for firms and marketers to distinguish themselves from the competition. If your firm is not already using Net Promoter Score or other recognized client experience metric, advocate for adopting one. If you do have client satisfaction data – interrogate it! Look for patterns and create hypotheses about where dissatisfaction may be coming from. Take ownership of the firm’s client experience metric – determine how the Marketing/BD organization can influence it. Finally, hold your team accountable for a client experience standard. If your internal clients are not Net Promoters of your team, find out why and do something about it.
Use metrics to create a data-driven Marketing/BD culture
The survey shows that use of marketing metrics is quite variable at law firms. Historically, measurement has not come naturally to the right-brain world of Marketing/BD. But that is changing rapidly because of the digital transformation that has affected all industries, including law firms. Today, position descriptions like “Director of Marketing Science” are appearing more frequently on job boards. Law firm CMOs need to recognize this trend by considering data and analytics as core marketing competencies, and setting expectations around these competencies for their teams. An excellent way to start is through metrics. Consider holding yourself and your team accountable for a small number of relevant Key Performance Indicators for marketing success. Define those rigorously, produce them on a regular schedule, and make sure they are noticed – ideally through a real-time Marketing Dashboard and/or quarterly scorecard.
Move Marketing/BD up the revenue value chain
The survey clearly shows that law firms are working on improving their marketing business processes. What’s less clear are the objectives of those process improvements – are they designed to reduce workload (and potentially headcount) or are they intended to drive greater business value from Marketing/BD? Certainly, there’s a place for making current processes more efficient and cost effective – but the priority should be to connect marketing activity with revenue generation. In summary, when we improve a business process, consider how doing so can help the Marketing/BD team move from being obedient executers to strong Revenue Enablers™.
Build the business case for more IT integration
An important survey finding is a strong relationship between law firm CMOs and their CIOs / IT organizations. We believe now is time to leverage those relationships to address a critical pain point – poor integration of marketing systems and data. With over 3,500 marketing technology (martec) vendors in the market today, law firms typically have a proliferation of marketing systems and data sources, which demand a great deal of effort to extract usable information. The martec industry is rapidly developing approaches for producing more integrated data. CMOs should consider partnering with CIOs to understand the technologies, envision the future, and create business cases for the investments that will be needed over time.
Map your team’s skills so you can grow them.
At a time when the required skill set for successful Marketing/BD is changing so rapidly, it is troubling that so few law firm CMOs maintain an inventory of the skills available within their teams. Without this inventory – as well as knowledge of the skills that will be critical in the future – it is difficult to see how CMOs will be able to develop their organizations to meet the changing needs of their internal clients. Our advice is to start by mapping the competencies that your team requires to be successful – at each level of the organization. Define the technical, interpersonal and organizational skills required for a coordinator, manager and director-level role. Then, assess your current team against this map. This exercise will help you develop your existing team members, and refine roles when it’s time to hire.
Get the Research
You can download the Executive Summary of Calibrate Legal’s 2017 Law Firm Marketing Operations Index here. For a copy of the full results, contact Calibrate Legal.