What if your law firm collapsed due to one small oversight?
According to research from Law Coaching, as many as 92% of law firms eventually collapse. There are many reasons for this, but one of the big ones is that failed law firms did not market themselves as much as they should.
For a law firm, it’s difficult to market properly without having a marketing budget in mind. Shockingly, less than 46% of firms have a marketing budget, and many who have a budget don’t know how much they should be spending.
How much should a law firm spend on marketing and especially online marketing? To help answer that question, we put together this guide. Keep reading to discover everything you need to know!
How Much Should a Law Firm Spend on Marketing?
Generally, your marketing budget should be anywhere between 2% and 18% of your firm’s gross revenue.
Why is there such a large range? For one thing, smaller firms and larger firms should spend different amounts on their marketing (more on this later).
And where your firm is located plays a part in how much you spend. If you are based in a major metropolitan area or otherwise have a lot of competition, you will need to spend more on marketing.
No matter how much you spend, though, the important thing is to get a solid ROI. Our guide will walk you through how to maximize your marketing budget using social media marketing and SEO.
How Much Should a Law Firm Spend on Online Marketing?
Regardless of your overall marketing budget, your firm should spend 65% of that budget on online marketing. This reflects the fact that many of your potential clients are likelier to find your firm via online marketing than offline marketing.
Of course, “online marketing” is something of an umbrella term. This may refer to funds you use for website development, search engine optimization, branding, social media marketing, and so on.
Regarding online marketing, some methods will be more expensive than others. For example, social media marketing and SEO improvement are relatively cheap. If you or anyone at your firm is very online-savvy, you may be able to handle some of this marketing in-house.
Other types of online marketing are more expensive, including running paid ads. The good news with paid ads is that you only pay for how many people click on the ad. And you can set a firm budget by the day, week, or month.
As with any other marketing, online marketing is often a matter of trial and error. Over time, you will discover what works best for you and your particular firm.
Who Should Spend More: Smaller or Larger Firms?
For the most part, smaller law firms should spend more on marketing than larger law firms. Small firms should spend between 5% and 10% of their gross revenue. Larger firms should spend between 2% and 5% of their gross revenue.
The reason for this disparity is very straightforward. Smaller firms tend to be newer firms. They need to spend more on marketing in order to raise brand awareness and carve out their own place in the market.
By comparison, larger law firms tend to be more established. Their brands are better known to the public, so they don’t need to spend as much on marketing.
Of course, things may change over time. If a larger law firm is worried about losing ground to a competitor, it may ramp up its marketing budget. Whenever you wish to raise more brand awareness and capture a larger market share, investing more in marketing is a solid move.
Are Certain Areas of Practice More Expensive to Market?
Some areas of practice will be more expensive to market than others. As an example, personal injury law is very expensive.
It’s not hard to imagine why personal injury law is expensive for you to market. After all, there are so many competitors in even smaller areas. And personal injuries are common enough that many people are seeking legal help every day.
You may also have an area of practice that is cheaper to market. By now, you should know how much competition you have and how much demand there is for what your law firm specializes in. Keep in mind that nothing keeps you from starting with a smaller marketing budget and ramping up over time as you discover what works best.
Building Your Marketing Funnel
The primary goal of marketing for your law firm is to raise awareness of your law firm and gain more clients. And this means you need to understand the marketing funnel and how it affects your firm.
The marketing funnel can be broken down into three stages. These stages are awareness, consideration, and conversion.
At the awareness stage, you are simply trying to attract the attention of potential clients. When it comes to your online marketing budget, this may only take up 10% of your online budget because you can handle so much of it via social media and online ads.
At the consideration stage, you are trying to showcase that your law firm can help clients with a particular issue. They may not need such help yet, but you want them to remember your name when they do. SEO and pay-per-click ads can help with this, and this may take up to 50% of your online marketing budget.
The conversion stage of the funnel is when you focus on gaining leads who need legal help and positioning yourself as the best firm to help them. You should spend the remainder of your budget on this, and you can accomplish it with specialized ads (such as specific PPC ads, retargeting ads, and so on).
Where to Market Your Firm Via Social Media
Earlier, we touched on the idea of social media being a great way to market your law firm. Social media marketing is very cheap and helps you to reach many people. But which social media platform is best for your marketing needs?
You are going to get the best value for your marketing dollars via Facebook. Many of your prospective clients are likelier to use this social media platform. And Facebook provides a number of ways to market yourself for free (for example, setting up a business page) or via paid advertising.
Chances are your online budget allows you to market across more than one social media platform. Aside from Facebook, you are best off marketing on Twitter, Instagram, and LinkedIn.
And YouTube is growing as a viable platform for legal advertising. You can either create unique content for Youtube or (better yet) craft recorded content that you use across multiple platforms and channels.
Don’t Forget SEO
As important as social media marketing is, the core aspect of your online marketing will always be your law firm’s website. Because so many prospective clients will find you online, your site may be the first thing they see.
That’s assuming they find it, though. Unless you have optimized every aspect of your website, people are far less likely to discover that site.
SEO is a complex topic and something of a moving target. What is considered “best practices” for SEO one year may not be as effective the next year. For this reason, you may not want to try to handle SEO yourself on an ongoing basis.
Instead, consider hiring third-party marketing experts who specialize in SEO. Not only will you get the benefit of best SEO practices year after year, but neither you nor any of your team will have to expend your valuable time on this.
Retention Marketing vs. Acquisition Marketing
As complex as marketing your law firm can be, most of the marketing can be broken down into two categories. Those categories are retention marketing and acquisition marketing.
With retention marketing, you are focused on retaining clients. In some cases, this may mean clients who are likely to come back for future needs. For example, someone who needed your firm for a personal injury case may need similar help years down the line.
Retention marketing can also include referral programs. These may be formal or informal programs that encourage satisfied clients to recommend your firm to friends, family, and colleagues who may need you.
By comparison, acquisition marketing focuses on gaining new clients. Many of the strategies we outlined above focus on bringing new clients to your firm.
Should you budget more for retention marketing or acquisition marketing? It depends: smaller firms often budget more for acquisition and larger firms often budget more for retention. However, it all comes down to what gives your firm a better ROI.
To get the best ROI on marketing, you need to work with the right marketing experts.
Take Your Marketing To the Next Level Today!
Now you have an answer to “how much should a law firm spend on marketing?” However, do you know who can help you make the most of your marketing budget?
Here at Kelly, we specialize in helping law firms and other businesses thrive like never before. Contact us today to discover how we can take your marketing to the next level!