As part of my strategic planning process with clients, I conduct interviews with each lawyer and a representative group of staff. One of the many questions I ask them is this: how will your client base shift in the coming five years, and how might that affect how you will provide legal services to them?
This generally elicits a very long pause as people try figure out what I’ve just asked them, and then realize that they’ve never really thought about it.
But clients shift all the time. For starters, they age. As they do so, they might need to transfer their business, or make a will. Other elements of demographics could shift – an increase in immigrants, for example. Pollical changes could result in legal practice changes – such as the decline of PI practices resulting from an NDP government. Economic changes can certainly cause client shifts (think recession). Technology developments can affect how we do business. An international pandemic can wreak havoc, as can an incident with far-reaching consequences (such as 9/11). Shifts can be obvious, or subtle. But they occur all the time.
Almost all other businesses incorporate marketplace analysis and projections into everything they do. After all, what’s the point of making a widget if you can’t sell a widget? Professional marketers go a step further: they try to determine what size, shape and colour the widget should ideally be for maximum pick-up; where those widgets will most be in demand; when and how to market them, etc. They know if/when the marketplace changes their feelings about widgets, and they know the ebbs and flows of the widget sales cycle: big in the summer, lower sales at Christmas perhaps. This is why marketing is on the right hand of most CEOs. It’s a critical component of a successful business.
This is the case with most businesses… except for law firms, of course. Law firms tolerate marketing, but innately believe that the firm is in control of its marketplace. They believe that the most meaningful shifts are the ones that come from within the firm itself: a practitioner retires, a lateral is hired, an Associate becomes a star in their practice area. They don’t really think about the shifts that might be occurring within their marketplace because they don’t find this data relevant or interesting. And that’s why so few law firm marketers have a seat at the table.
Lawyers also use the excuse that predicting future client shifts is not a priority for the moment. This is one of the toughest lawyer and staff job markets in over 30 years. Many firms are turning down client work as there aren’t enough bodies to do what’s coming in already. Why should they stop to think about the future? This logic holds even more weight when coupled with the reality that most lawyers don’t know how to extrapolate current trends into future predictions. And lawyers don’t like to do what they aren’t good at.
But this is precisely why the industry is facing some of our biggest challenges within the profession. Here are two such examples:
- We’ve known for years about shifting demographics and the fact the baby boomers would be retiring. Yet firms are grappling with how to train up replacements, transfer client loyalties, and survive multiple Partner buy-outs;
- Here in BC, we’ve suspected for at least four years that the PI practice might well decline due to changing legislation. I know this because I have clients who started working with me four years ago on back-up plans. But many law firms are only just starting to consider how to replace this income, and pivot their PI lawyers.
Take the time to consider the shifts that your client base might experience in the coming five years. Think about what that means to your practice.
- What happens if remote work is here to stay for a percentage of your clients? Will some them need to downsize? Will some grow? Will you need to have more flexibility and options around how you provide legal services to a more decentralized workforce?
- What happens if the demographics of your target market dramatically shift? Does your firm have the language capabilities to deal with this? Do you have enough younger lawyers to meet the needs of the next generation of business owners? What are you doing to be more relevant to shifting demographics?
- With regional growth, will your firm still be in a central/accessible area five years from now or will you be on the fringes? And speaking of your office, will it even matter? Will clients still want to access your building or will the majority of your client interactions be virtual? What do you need to do to be more accessible to them?
- What changes in caselaw, the economy or politics threaten to usher in dramatic shifts in client behaviours, requiring adjustments from your firm in terms of practice areas or the advice you give?
I believe that it is the duty of a Partnership to consider future shifts in the firm’s marketplace and to plan and position the firm accordingly. Your marketer can help. If you don’t have one in-house, then hire some outside help. But understand that most other businesses consider this a standard business process. Not a luxury. Not icing. Not elective. While this might be new to law firms that don’t have a sophisticated marketing process, my hope is that you’ll now see the value in spending some time on this.
Heather Gray-Grant is a business strategist, marketing expert and executive coach for law firms, lawyers and administrators. She can be reached at email@example.com