I had a meeting with a potential client last week and, rightly so, the partners asked me to quantify the expected return on investment to them on costs of a particular marketing activity.
Quantified measurable results is typically one of the judging criteria for marketing awards, and in judging submissions I have seen a wide variety of responses to this question. Answers range from website hits, downloads, requests, new contacts, meetings, opportunities and business won. But, surprisingly, usually less than half of the submissions quantified the new business that has been won as a result of new campaigns, some of which appear quite costly indeed.
Peter Drucker’s saying ‘what gets measured, gets managed’ is well-worn, but I often come across a real weakness in measuring return on investment in marketing and business development.
Often firms have only a fairly hazy knowledge of exactly where all their business comes from and how this differs by practice area. Problems often stem from the fact that the practice management system is not very user-friendly when it comes to capturing or reporting this sort of information. Also, I find receptionists and fee-earners surprisingly reluctant to ask the question ‘how did you hear of us?’.
Budget approval meetings often still include a debate about whether the Yellow Pages still has merit as an advertising medium or whether it is worth putting effort into submissions for the legal directories. Whilst a few partners can anecdotally recall at least one client who has come through the door that way, where are the firms that know:
- how many enquiries they received from advertising in directories;
- the percentage of those that were converted to clients; and
- the total value of billings derived from those clients?
Without this information, how can you make meaningful decisions about whether or not the marketing budget has been well spent, and which activities you should repeat or drop next year?
However, I would caution against always dropping a new initiative which does not deliver new business immediately, if it is based upon sound business reasoning. For example, a sector-based marketing strategy can easily take a few years before a firm is recognised as a credible provider in a potentially new market. As one partner admitted last week, there can sometimes be a tendency to dismiss a marketing activity which does not yield immediate results.
Granted, many clients, particularly commercial ones, may come to your firm thorough a variety of contact points over a potentially lengthy period of time and it can be difficult to pin success to one activity. However, a customer relationship management system will allow you to record all these activities and help your track progress over time, demonstrating that a mix of marketing activity is required.
With so many practice management systems available in the legal market, it seems hard to find one which is really effective in this regard. I fear I will now be inundated with approaches by software suppliers now, and loud cries of ‘rubbish in – rubbish out!’.
Sue Bramall is director of Berners Marketing and former head of business development at Pinsent Masons