Six facts every lawyer must know to develop new business - Fact 2
Last week, I introduced Fact 1 from my talk on Six Facts Every Lawyer Must Know to Develop New Business: There are many ways to sell. This week, Fact 2: You must start with current clients.
According to Harry Mills (in the Rainmaker’s Toolkit, page 95): “ Research shows:
The chances of selling to an existing client are better than 1 in 2.
The chances of selling to a lost client are 1 in 3.
The chances of successfully selling to a fresh prospect are 1 in 8.”
The exact numbers will be different for your firm, but experts agree that in every business, it’s much easier to sell to people who know you than to sell to strangers.
ALM Research and The Brand Research Company will soon release their 2006 survey of what law firms are doing to develop new business. When it comes out, I’ll post a blog describing their findings. In the meantime, I can tell you that when it comes to new business, they concluded that even now “the largest share of growth by far is from selling more of the same work to existing clients.”
One way to get started with your current clients is to offer a free meeting to learn more about the client’s business needs. In some cases, these meetings will lead directly to new engagements. For example, I heard recently from a participant in one of my hotel workshops who had used my four step process to quickly prioritize the action items that best fit his personality and his practice. He decided to offer a free meeting to a current client, to discuss a new program.
The client loved the idea that the meeting was free, and provided the name of a new contact he wanted to invite. When the lawyer called to schedule the free meeting, the new contact mentioned a litigation that was about to be assigned to a competitor. The lawyer immediately arranged a separate meeting about that work, and got the engagement. That new business came before he even got to the free meeting.
In contrast, there’s nothing easy about selling to new clients. It’s the hardest work you can do in a suit. Even among professionals who devote their lives to selling, failure rates are high. In Gallup’s data on 250,000 professionals, the bottom 25% in every sales force sell little or nothing, and actually reduce the team’s productivity by distracting valuable management time (p. 24). That’s one reason why turnover is so high in sales positions.
When lawyers try to find new clients, some will succeed and some will fail. Can anyone predict which are which? I haven’t seen proof. The lawyers who are most successful sometimes surprise me, and even themselves. They are the ones who find the fit between their personal strengths, and the firm’s business development needs.
The conclusion is obvious: when a law firm first works on increasing sales, much of the initial effort should be aimed at existing clients. What do you do when you have 100% of a client’s legal business? Just keep pushing to make them even happier.
In today’s competitive environment, other law firms would like to get to your best clients, so you will need to put in more and more effort to protect what you have. For more, see my blogs on Gerry Riskin’s concept of “Bulletproofing your crown jewel clients,” and next week’s blog on Fact 3: You must listen.