Over the past few weeks, we have blogged about the problems law firms have in measuring the return on their marketing investments. As we have discussed, much of this is due to the lack of viable data to analyze, faulty assumptions that law firms make and some inherent problems with current ROI models.
Today however, I would like to discuss a methodology that, we believe offers real promise for providing law firms with the information they need to make good decisions. That methodology is called History of Client Origin (HCO).
HCO is a proprietary methodology through which the genesis of every new client is traced. In most cases, such new clients are the result of multiple exposures to a variety of marketing vehicles and/or individual interactions. Such individual interactions include those a client may have had with family, friends or colleagues; firm attorneys; and/or other past or current clients of the firm.
Utilization of such an approach allows one to ascertain marketing ROI and related metrics in a much more holistic manner, including for those types of scenarios where ROI is or has not been typically measured. Some examples of these include:
- Results from non-direct activities (e.g., brochures, web sites, etc.
- Situations in which clients have been exposed to the firm via more than one medium
- Situations in which clients come to the firm through word-of-mouth
Further, the HCO methodology incorporates one of the major expenses usually not tracked by traditional ROI approaches -- time. For many law practices, the investment of attorney time represents one of, if not the single largest marketing-related expense. By capturing this data, legal marketers are able to ascertain the best use of the firm's human resources.
HCO also enables law firms to compare the effects of not just one marketing vehicle to another, but also of personal networking to traditional marketing.
Because HCO traces the origin of every firm client, the ROI metrics obtained are much richer. For example, a single exposure to an ad, an article or a firm attorney may have contributed in part to the obtaining of a particular client, who in turn contributed to the obtaining of additional clients and so forth -- sometimes through several generations. By measuring the marketing ROI through such a prism, law firms gain a clearer understanding of how the marketing and business development phenomena are exponential in nature, and thus which tools (or combinations thereof) work over the short and/or the long term.
Next week, we will discuss how various marketing and business development tools work together and how HCO accounts for this phenomenon. This is especially useful when new clients have been exposed to multiple media or individuals (i.e., touch points).
In the meantime, if you have some thoughts regarding the means by which law firms track their marketing ROI, please join the conversation right here. We are eager to hear from you.