Business development is heating up in law firm circles.
Market research firm BTI Consulting, known for its benchmark survey research, has called the climate a “Predator’s Paradise.” More recently, the research firm spied opportunity by noting corporate counsel is shifting some work back to law firms – but only for “bet- the-company” litigation business. Some of our own research, based on $18 billion in legal invoices, found the largest law firms are winning a majority of high value IP litigation work.
As competition continues to increase, there are three recent studies indicated law firms are getting more focused on staff, processes and infrastructure to win new business.
1. Law Firms Warming up to Sales
The Legal Marketing Association (LMA), recently published a survey of 53 law firms conducted jointly with American Lawyer Media (ALM) finding large law firms are warming up to the idea of hiring bona fide sales professionals to help with business development.
Still the survey also notes cultural resistance, steeped in law firm tradition remains. One of the chief proponents of the LMA study was cited in a Crain’s Chicago Business article in early 2014 which underscores the cultural shift:
“In a profession that once banned advertising, law firms are rushing to embrace something truly radical: a sales culture nurtured by non-lawyers like Gregory Fleischmann.”
2. Big Law and Big BD Investments
The full report – The Strategic New Roles Of Marketing And The Library In Big Law – suggests that competitive intelligence is a convergence point between law librarians and law firm marketing. More than half – 57% reported competitive intelligence “support is a joint responsibility between the library and marketing.”
The report recommends law librarians “be more proactive as internal business development consultants, not only to investigate and acquire tools and resources, but to support and better understand the practice group’s needs.”
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3. Renewed Focus on Business Development
A new LexisNexis survey of 400 law firm marketing and business development also indicates a renewed focus on business development. In broad terms the survey finds law firms are optimistic, wary about competition, believe new business strategies have shifted, but approaches vary:
- Growing optimism for new business. More than half – 57% are optimistic about law firm growth this year, while about one-third expect growth to remain flat. Just 5% expressed pessimism.
- Competition the top barrier to growth. Competition was the single largest challenge to law firm growth according to 52% of respondents. The next highest challenges cited were 2) attorney participation; 3) pricing; 4) no long-term strategy; and 5) no accountability, for example one respondent wrote in the open-ended comments “Lack of follow-up on proposals from attorneys.”
- New business strategy has shifted. Upwards of 90% believe there is a fairly clear distinction between “law firm marketing” and “law firm business development” and the skills required to perform those duties. When asked how one respondent among more than 300 responses quipped, “One spends money, the other makes it.”
- Voices carry, approaches vary. About one-quarter of respondents said their law firm did not have a business development department, while 29% indicated marketing reports to business development. Just about one-fourth of law firms say they have a chief business development officer (CBDO) and of those, 81% said the CMO fills both roles.
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“There should not be a handoff between marketing and business development activities. Rather the marketing and BD efforts should be intertwined.”
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