A few years ago, many law firms regarded client engagement as somewhat of a buzzword: a fad that would pass along with social media and cloud computing. However, these fads have refused to pass and client engagement, social media and cloud have become important for most firms, and invaluable for many.
In fact, far from fading from view, the role of client engagement for law firms has actually become more necessary than ever. This is because we’re now in what Forrester Research calls the Age of the Customer. In this new age, customers are faced with so much choice about which products they buy, which services they employ and which brands they engage with, that it’s no longer enough for companies to differentiate based on competitive pricing or quality of their offering. Instead, companies must place a heavier focus on understanding and connecting with their customers in order to gain and sustain a competitive advantage.
Not only are customers faced with more choice than ever, but they are much better informed than they ever have been before. Today’s wealth of accessible information and ease of communication enables people to thoroughly research companies, products or services before making a choice. Clients today make decisions based on the experience of others, making it ever more important for companies to ensure they have happy, engaged, loyal customers. According to Lee Resources, it takes 12 positive reviews to make up for one negative one, so it’s vital that companies take care to keep their customers happy to prevent negative customer experiences.
How does this apply to law firms?
This shift impacts every industry, including law. As clients become accustomed to building relationships with companies they deal with, their level of expectation changes. Companies that do not match this level of service or relationship struggle to attract and maintain custom, compared with businesses that focus on getting their customers to be fully engaged, emotionally attached and loyal. Clients have begun to expect the same level of interaction with their professional service providers as they do with other companies that they engage with.
Law is a highly competitive industry where it is difficult for clients to distinguish between the quality of services and expertise offered by various firms. This is why it’s so important for firms to concentrate on retaining clients, and the best way to do this is by building relationships with them. Developing client loyalty is not something that can be achieved in a few weeks; it is an on-going relationship that grows steadily over time, requiring consistent communication, level of service and trust-building.
What can law firms gain from having engaged clients?
Ultimately, law firms will benefit from having higher client retention rates and increased fees. According to Gallup Research, companies that focus on client engagement outperform their competitors by 85% in sales growth. For mid-sized law firms, where the market is extremely competitive and pressure to save costs and reduce fees is felt the hardest, retaining clients is more important than ever. For firms that excel at client engagement, the majority of new business comes from existing clients, and in turn these loyal clients recommend the firms to others.
As well as seeing substantial financial benefits, law firms benefit from having clients that know and trust them. This makes clients more likely to be receptive to advice and assistance, positioning the firm as a trusted advisor. Clients who have this relationship with their lawyers are more likely to seek legal advice in situations when they might not otherwise choose to do so. In working with returning clients, lawyers will have the opportunity to develop genuine relationships with individuals over long periods of time and can develop a collaborative relationship with the client, further deepening the connection between law firm and client.In an incredibly competitive industry, law firms must do all they can to gain clients and keep hold of them. Building a relationship with each client makes them feel invested in the firm, ensuring their loyalty and hopefully making them into a client “for life” and acting as advocates for the firm. In order to achieve this, firms need to change the way they interact with their clients. Find out how law firms can build client engagement in our blog post next week.