If you're thinking about creating a marketing budget for your law firm then you’re already doing what most attorneys aren’t. You're thinking about your marketing. By thinking about a budget you are showing that you care about client acquisition and the success of your law firm. Creating a marketing budget is not easy, though. There is a lot of risk-taking and trail and error involved in creating marketing plans and it can be intimidating. You may be asking yourself...
What happens if I spend a lot of money on an advertisement but don't gain enough clients from it?
How much money is too much to spend on an advertisement?
How much is too little?
How will I know which advertisements are working and which are not?
Should I hire a marketing director to do all of this?
I wish I could give you a concrete answer, but as stated in the video, there is no "magic number" that guarantees, "if I spend $1,000 on this advertisement then I will make $10,000." I will say this, people often come to us and are either spending almost no money on marketing or spending entirely too much money without seeing much return. Both routes are mistakes. You should be investing in your law firm's marketing, but you should not be misguidedly buying advertisements without following up on the effectiveness of them.
While I can't give you a number to use as your budget, I can give you guidance as to what factors to consider when framing your budget.
What To Consider When Creating Your Budget
Return on Investment
Return on Investment (ROI) is how much money you are receiving from the investment, in this case, an advertisement. Of course, we all would like to receive the maximum profit from an advertisement or marketing effort that costs us the least to do. By measuring your return on investment for advertisements, you can eliminate uncertainties when deciding how much money to invest in an advertisement because you know which type of advertisements perform well and which do not.
Average Value of Client
Client value will differ depending on practice area and law firm values. If your rates are dependent on the type of case then, of course, a high-value client will have a high-value case that brings you a large amount of money. But what if your type of practice has fixed rate services? You do still have clients that are more valuable than others. Other factors that affect client value are how much time and effort is spent on the case, how well the client communicates with you and your team, and whether or not you like working with the client and if his or her values align with your own.
Tracking and Measuring Results
Tracking lets us know which advertisements to invest in and which advertisements to stop investing in. There is no guarantee that an advertisement will be effective, but if you are tracking the results then your marketing will more successful more times than not. Facing the failure of an expensive advertisement may sting, but it is a learning experience for you about what types of advertisements don't work. Without tracking, you would keep buying the same advertisement that isn't obtaining positive results. In the long-term, this wastes more money than if you immediately pulled the advertisement to start over.
P.S. Members of Great Legal Marketing (GLM) can ask me questions about their marketing budgets. I enjoy reviewing advertisements and giving feedback on marketing strategies. The scariest part about creating a marketing budget and tracking is facing failure. GLM members receive the benefits of learning from myself and other members of the GLM team, as well as from other attorney's who have tested the strategies we teach and use the checklists and tools given to them and continuously see positive results.