A Beginner’s Guide to Calculating Your Law Firm’s Marketing ROI
What are you going to do?
Next year I mean. Do you have a plan already outlined for your law firm’s marketing in 2019? Odds are, you have some idea of what you’re going to do. You might even have a list of things you wish you could do. But to move ahead with confidence, you need to have a good idea of what to expect. That comes from knowing how to calculate your marketing ROI – return on investment.
To figure out your ROI, you need to know a few things:
- What you spent on your marketing
- What you earned as a result
There’s a real challenge to that simple equation though. What you spent could mean a lot of things. And knowing what you earned can be challenging to define when you use multiple marketing tactics simultaneously.
I’m going to approach this from the perspective that anyone reading this column is doing this on their own. If you’re working with a professional marketing firm like FindLaw, you’re going to benefit from some far more sophisticated performance reporting than the average attorney has the time to create on their own. With that in mind…
Keep It Simple
Remember to keep your tracking and reporting manageable. Data analysis can quickly lead the best of us down a rabbit hole. For small and solo law firms, there’s a difference between what you can track and what you should. You need to know your limits and avoid collecting or reviewing data you aren’t actually going to use.
Let me be clear. I’m not encouraging you to ignore the details or make decisions based on incomplete data. I’m simply saying that if you’re looking to gain a quick view of how your marketing is doing, you have to draw some boundaries.
So yes, clicks matter. The performance of your law firm’s online marketing is vitally important to optimizing your programs. But if you’re looking to calculate marketing ROI in the big, don’t get lost in the details. Stick to the dollar signs: “In Q3 2018, my law firm’s paid advertising brought in a total of $______.__.”
Keep It Simple, Part 2
What’s your hourly rate and how many hours did you spend on your last pay-per-click campaign? Got a headache yet? You could track hours spent designing ads and landing pages or researching keywords. Information like this could actually be very helpful in deciding when it’s time to work with a professional versus going it alone.
But like too much website data, this degree of specificity can quickly muddy the waters surrounding your law firm’s marketing ROI. Instead, focus on dollars spent: “From July through September, our firm spent $______.__ on Google AdWords campaigns.”
Separate and Evaluate
You’ve probably noticed that I’m limiting the outbound and inbound dollars to a hypothetical PPC campaign. Assuming your law firm is using more than one marketing tactic, you need to differentiate which processes are generating which clients.
Simply stated, you cannot track the effectiveness of your marketing if you jumble all your activities together. Don’t roll your PPC advertising budget in with your print campaigns. Don’t send multiple marketing sources to the same call tracking number. Don’t route different ad campaigns to one landing page. If you do, you’ll never be able to identify what it was that finally tipped the scales in your favor.
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But… Don’t Be Afraid to Combine
If you’ve read this blog before, you know that legal consumers don’t all convert because of a single marketing campaign. It’s rare when a client walks through your door saying, “I saw your Facebook post about that little league team you sponsored and knew you were the lawyer for me!” I mention this because looking at any single legal marketing tactic can be disheartening. It’s important to take a big picture view of your interconnected tactics when considering your law firm’s marketing ROI.
If you’re calculating multiple tactics or campaigns separately, go ahead and compare them to their peers, but keep an open mind. For one, different tactics will naturally yield different results based on where their audiences are in the buyer’s journey. Organic social media is pretty far upstream from a legal directory listing, and it likely has a very different call-to-action for the viewer. Also remember that different tactics feed each other to reinforce a broader marketing strategy. You need to know what the ROI of your different programs, but keep in mind that marketing campaigns do not exist within a vacuum.
One More Thing: Know Your Market
Even with the hypothetical situations above, there’s still the issue of different practice areas having different financial models – and different consumer behaviors. My final piece of advice here is to know your market.
If you have a slow or drawn-out “sales cycle” where legal consumers spend weeks plodding from basic awareness of a legal need to finally hiring an attorney, tracking your marketing ROI is going to require patience. Likewise, if your firm’s business can be a steady trickle for months before a big case makes your whole year, your marketing performance numbers could be wildly unpredictable.
Only you will know these nuances of your law firm’s business. Keep them in mind when you turn your gaze on marketing and ask, “What have you done for me lately?” After all, even the most complex ROI calculator can only give you numbers. There’s always more to the story.