By Peter Boyd, Florida attorney who founded PaperStreet. He has helped over 1,500 law firms with their websites, content and marketing.
In many law firms, managers have not accurately calculated the return on investment (ROI) for internet marketing dollars. In some firms, no one even has a clear picture of how much they’ve spent on online marketing, or even all marketing efforts combined.
Understanding how to calculate your law firm’s ROI for internet marketing is the first step toward unlocking the power of effective marketing. Marketing based on intuition or optimism may be traditional in the legal business, but it is not an efficient path to success.
Know What You Mean By Return On Investment
ROI—return on investment—is a simple term that can have complex meanings and be measured in different ways.
Investment In Time As Well As Money. First, consider your investment. The money spent on marketing can be fairly easy to track if your firm works extensively with a professional legal marketing firm. In fact, the marketing company should be sending regular reports that detail not only where you’ve spent your money but also show some results.
Tracking your investment of time is a lot more difficult. You’ll need to consider the time members of the firm invest in creating content or reviewing content produced by your marketing company. While someone at the firm needs to monitor marketing efforts, if marketing is taking up multiple hours of attorney time each week, it might be worthwhile to consider outsourcing some tasks for the most cost-effective use of human resources.
Different Ways To Look At Returns. After reviewing your investment of money and time, then consider the return you are looking for. For internet marketing, are you looking for the number of times your firm has been introduced to new potential clients? The number of potential clients who have visited your website to learn about your services? The number of potential clients who contacted your firm for a consultation?
Or are you looking at the number of contracted clients that resulted? Are you considering a narrow range of results from a specific leads generation or SEO campaign? Or are you evaluating the combined effects of all efforts? Ideally, you should know and analyze all of these types of returns on a regular basis. That way, you can see the strengths and weaknesses in the marketing chain.
Of course, one return that is difficult to measure but perhaps most valuable in the long run is the effect of marketing efforts on your firm’s reputation. Producing timely, informative blogs, for instance, can position your firm as a leader in the field and keep your name in the minds of potential clients. But you may not see that pay off for months or even years.
Calculating The ROI On Lead Generation
Potential clients who have shown some form of interest in your firm are known as leads. Since most law firms need new clients to remain viable, the process of generating new leads should be ongoing. How can you tell how well that process is working?
The easiest method is to add up marketing costs over a certain time and divide that by the number of leads generated in that time. This gives you a cost per lead. But that only gives you part of the picture. Ideally, you want to track where the leads have come from to see how much you are paying for leads from each source. This can be as specific as a single ad campaign on one social media platform.
Call tracking software, unique tracking links and lead tracking software are all useful tools for analyzing where traffic is coming from so you can see which online marketing avenues are providing the best return. Old-fashioned methods, such as asking a client directly how they learned about your firm, can also give you some indication of how well different forms of outreach are connecting with and convincing your audience to become clients.
Considering All The Benchmarks
Leads are essential to online firm marketing, but it is important to consider all stages of the process. Analytic tools like those offered through Google Analytics can show you the number of unique visitors to your site. Tracking software can help you determine how many of those visitors fill out contact forms and become leads. You can compare new client lists to find out your conversion rate from visitors to leads and from leads to clients. You also need to establish an average revenue generated per client or per type of client.
For instance, if you determine that the average revenue generated per client is $6,000 and your Google ad campaigns bring in two new clients per month, then those ads are bringing in $12,000 month. How much are you spending to create the content and place the ads each month? The same analysis needs to be undertaken for each online marketing avenue, if possible. If you are working with a marketing firm and they do not automatically supply information showing the leads generated by ads or blogs or unique visitors to your website, ask for that information. If you want help determining how many of your new clients are coming from various marketing efforts, ask your marketing firm to find the best ways to track that information. They are there to help you maximize your return on your investment, and they should be able to demonstrate how they are accomplishing that goal.
Look At Calculations From The Right Perspective
In the world of internet marketing where sweeping changes can be made instantaneously and results can be measured in real time, we sometimes have to remember to pause and wait. While measurements are immediate, results still take time to play out.
Trying to gauge the ROI of a campaign too soon can give you incomplete results. When reviewing returns, look for overall trends rather than specific anomalies. It takes time for marketing investments to pay off. But if you’re showing no measurable progress after a sufficient period, then it is time for a new strategy.