Focus on value proposition (first published on Law Society Gazette/In Business blog)

Click here to see this article on the Law Society Gazette web site.

It is relatively rare that the marketing team is consulted in areas such as pricing, but all a firm’s effort and expenditure on promotion may amount to nothing if the solicitor receiving an enquiry fails to communicate the value in the service which he or she is proposing to provide.

I often get to see how well this part of the client experience is performed when reviewing mystery shopping reports, where we look at how clearly the costs were explained, whether the mystery client felt they understood the value in the service being offered and the payment terms and options.

Potential clients are often left confused, uncertain or unclear about the benefits or risks in proceeding.

I recently reviewed a letter offering to give advice on inheritance tax planning. It had evidently been typed from a dictation, as the stream of explanation regarding a number of cost options was part of one very long paragraph. It was rather tricky to follow, when a table setting out options A, B and C would have been the ideal presentation. But more worryingly, nowhere did the letter explain that whilst the costs amounted to over £1,000, the amount that might be safeguarded from the Treasury or the local council care service amounted to a few hundred thousand pounds.

Earlier this year, the Legal Ombusdman published a useful guide for lawyers entitled An ombudsman’s view of good costs service. It includes a range of complaints which have passed across their desks, illustrating how lack of clarity in how costs information is provided can lead to problems at a later stage. Pricing is an important part of the marketing mix, and as competition intensifies in the legal marketplace it is important to ensure that your value proposition, pricing strategy and price communications do not let you down.

Letting the marketing team review your costs proposals could identify some simple improvements in presentation which might clarify things for your clients and reduce risks later on. Many firms are starting to get to grips with alternative fee arrangements such as fixed fees, but particular care is needed in communicating how risk is apportioned in these. Our American cousins are a long way ahead of us in this regard and this is a subject for another blog I suspect.

Few lawyers receive training in pricing strategies and negotiation, as do even fewer receptionists and junior assistants and yet they are often handling enquiries to quite an advanced stage. Filtering potential time-wasters from good clients is an important skill, but it is worth checking that your receptionist is not responding to all calls with a terse: 'Mr X does not give free advice. He charges £200 + VAT per hour and we need £500 upfront before a consultation,' as we encountered recently.

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