Appalling: Law Firms Spend only 1.1% of Gross Revenue on Marketing and Sales
Jim Hassett is appalled that law firms spend only 1.1% of gross revenue on marketing and business development. Right on Jim, this amount is totally insuffient. And I worked at a law firm that spent a fraction of 1% of gross revenue on marketing only.
Jim says: "Did you see the recent survey of business development spending on the cover of Law Firm, Inc.? The writer seemed encouraged by the upward trends, but I was appalled.
"When ALM and Brand Research surveyed large firms for this article, they found annual spending of $1.8 million on marketing (defined as communication to groups of buyers) and $1.3 million on business development (defined as selling to individual buyers).
"The combined figures were about 1.1% of gross revenue -- so ridiculously low that I don't even want to talk about it. Today, I need to rant about the fact that the average law firm spends more on marketing than on sales. What a waste.
"Let's see, which is more important: communicating with groups or selling to individuals? Which is more likely to bring in new revenue next month: a better web page, or sitting down to talk with people who have legal needs and budgets?
His advice: Select a few partners who like people, and turn them loose. Better yet, spend 5% or 10% of your money on marketing to figure out who these rainmakers should talk to and what they should say. Then turn them loose.
