Experienced business developers know that it costs five times more to sell a new service to a new client than it costs to sell an additional service to an existing client.
After all, if you are doing your job right, your existing clients already know, like and trust you. With these three elements already in place, the sales cycle is much shorter.
In spite of this fact, most lawyers and law firms concentrate their business development efforts and dollars on new client development. This is a big mistake.
Cross-selling is the intentional and strategic effort to broaden the types of legal services a law firm provides to an existing client.
In addition to lower costs and shorter sales cycles, other benefits of cross-selling include protection of clients from “free agent” lawyers (because clients who work with more than one lawyer at a firm are less likely to leave when one of the lawyers leaves); increased competitiveness (as clients continue the trend of using fewer law firms for more of their work); a more collaborative firm culture (law firms deteriorate when lawyers and practice groups work in isolated silos); and improved morale.
Unfortunately, the mere mention of selling or cross-selling is enough to make most lawyers run for the nearest exit.
There are six primary objections raised by lawyers to cross-selling – lack of time, lack of awareness, fear, loathing, distrust of colleagues and lack of compensation for their efforts.
Challenges: Lack of time
When it comes to developing new business, most lawyers protest that they barely have time to market their own practices.
It can be very difficult to engage such a lawyer in a program aimed at developing business for a colleague or colleagues down the hall.
Any effort to create a cross-selling initiative must be highly focused and must involve a lot of hands-on management by a firm’s marketing department. It is the role of marketing to reduce the time constraint on lawyers as much as possible.
Do your research to identify a core group of existing clients with potential additional needs, and to identify what those needs might be. Provide dossiers on these clients. Get input and buy-in from the attorneys who already work with the target clients. Then assemble a small team of attorneys who could meet additional needs.
Start with a small number of small groups composed of willing participants. One-to-one matchmaking between the relationship lawyer and a colleague who provides potentially complementary services often works just fine.
Launching a firm-wide cross-selling program comes with some negatives. A large cross-selling initiative can raise expectations and spread marketing support too thin. Not everyone will buy in. Firm-wide programs allow skeptics to surface and undermine your efforts. Instead, start small and publicize your successes. Before long, lawyers will see the benefits and willingly join your program.
Challenges: Lack of awareness
Law firms tend to operate in a “silo” environment, with little communication among practice areas. Surprisingly often, lawyers in one area are not aware of what their colleagues in other areas do — and how they could add value to a client.
The larger and more geographically diverse the law firm, the greater the lack of awareness among its lawyers.
Marketing should facilitate on-going cross-selling sessions between practice groups or even small groups of interested attorneys. Everyone should do his or her homework before each session” said Holmes. “The more you prepare, the better the results.
Participants should be ready to succinctly describe the legal services they provide – and for whom. You must be able to describe your ‘product’ in order to sell it. This is another area in which marketing can help you prepare.
Each session should conclude with a list of follow-up action items. Take careful notes so that participants know who is responsible for what by the time the next meeting takes place, and then hold them to it.
Lack of awareness also extends to “who knows whom” within the firm. Before any meeting, marketing should mine the firm’s CRM system and also social media sites like LinkedIn to uncover unexpected connections.
Challenges: Fear and loathing
The general concept of sales is scary even to trained members of professional sales teams; it is even scarier to untrained lawyers.
Plus, lawyers have more specific fears. There is the fear of failure if you make a pitch and lose. There is the fear that you will no longer ‘own’ the client relationship and your business will cease to be as portable. There is the fear that you will lose credibility with the client if the new lawyer does not live up to expectations.
In addition to fear, many lawyers dislike the idea of selling. Now legal marketers and consultants are asking them to not only sell themselves, but also sell their peers.
It helps to re-brand cross-selling by calling it something else – cross-marketing, cross-introduction, cross-pollination or cross-referral. Emphasize introductions and improved/expanded service rather than sales.
Address fear and loathing with persuasive facts. Start with willing participants who are not afraid. Start small and keep it simple. Circulate the news about positive outcomes throughout the firm to chip away at negative attitudes and bring the rest of your lawyers along slowly.
One of the best ways to overcome fear and loathing is to demonstrate to your lawyers that most of their clients are pleased by a proactive approach and interested in a wider range of services.
Conduct routine formal client interviews and informal checkups to assess client needs. You will find that clients want to know about other areas in which you can make their lives easier or deliver better value. Then, go back to the relationship attorney with this evidence in support of your cross-selling efforts.
Planning and execution are the true keys to overcoming fear and dislike of sales among lawyers. You need the right people, on the right bus, at the right time and going in the right direction.
The ‘right people’ are lawyers who are interested in cross-selling and ready to put aside the six common objections. The ‘right bus’ is a willingness to do what it takes to manage and exchange relationships. The ‘right time’ is when a client need has been identified. The ‘right direction’ is targeting existing clients who have a strong relationship with the lead attorney and a high level of satisfaction with the work.
Challenges: Distrust of colleagues
By nature, lawyers are a very cynical bunch – a fact that is supported by a wide range of widely publicized personality tests. Law school and legal practice hone this natural cynicism to a fine point.
The cynicism that is useful in an adversarial environment can be highly detrimental when it comes to knowing, liking and trusting your colleagues enough to make a referral. Shockingly, I’ve heard of many lawyers who would rather refer to an attorney outside their own firm than to a colleague within their firm.
A previous section discussed how to address this issue through building internal awareness. Building internal relationships is another essential way of breaking down ignorance and distrust. The ‘know, like and trust’ paradigm is the foundation of every referral – whether external or internal.
Regular one-on-one social and professional interaction with colleagues in different practice areas should be an important and recognized component in each lawyer’s individual business development plan. Lawyers should be encouraged to periodically locate themselves in another practice area or even work from other offices.
Ideally, marketers are conducting ongoing research regarding lawyer capabilities, lawyer connections and client needs. They can use their research in these areas to act as professional matchmakers within the firm. Who might make a good couple?
Challenges: Lack of compensation
For cross-selling to have the best chance of success, law firm compensation systems should be revamped to reward collaboration as a component of origination fees. But even an improved compensation plan is no guarantee of success.
Additionally, research shows that money is not the strongest motivator when it comes to attorney behavior. Sometimes, the intrinsic rewards of public recognition and acknowledgement can be much stronger — even among attorneys earning many hundreds of thousands of dollars a year. Recognition or awards do not have to be serious, either. Sometimes, even something whimsical can be an effective incentive.
The following story illustrates this point. When a legal marketer was working in Washington, D.C., she worked with a lawyer who became a highly successful cross-seller. He came to her one day and said, ‘I am so good at this that I deserve an (expletive-deleted) award.’
As a joke, the marketer made him an (expletive-not-deleted) award to hang on his office wall. When his colleagues saw it, they started coming to her to ask how they could get their own (expletive-not-deleted) awards for cross-selling. She built on this interest to work with them, and ended up granting 25 awards.
Cross-selling is a proven way to lower costs, shorten sales cycles, increase client retention and business, and strengthen law firm culture and morale. Do not let your lawyers use compensation concerns – or any of the above challenges – as an excuse to hold your firm back in today’s highly competitive environment.
Janet Ellen Raasch is a writer, ghostwriter and blogger www.constantcontentblog.com [http://www.constantcontentblog.com] who works closely with professional services providers – especially lawyers, law firms, legal consultants and legal professionals – to help them achieve name recognition and new business through publication of keyword-rich content for the Internet as well as articles and books for print. She can be reached at (303) 399-5041 or firstname.lastname@example.org.
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