How much a law firm should spend on marketing depends on factors such as the particular type of law you practice and the competitiveness in your surrounding area. In general, competition for clients is increasing for most lawyers, so it is more important than ever to budget for marketing to attract and maintain clients. Since most people now turn to online sources such as Google and Facebook when looking for a lawyer, having an online presence and a first-rate website is essential, but there are other areas where your marketing dollar counts as well.

Since attorneys tend to be experts in their field of law but not in marketing, it often makes good business sense to utilize a legal marketing consultant to determine your marketing budget and where to focus it.

The consultants at Lawyers Marketing Associates (LMA) are available to help by:

  • Examining the individual marketing needs of your firm and your specialty
  • Determining what marketing focus would work best for you
  • Designing individualized marketing strategies to bring you clients and make your law firm grow
  • Saving you money by developing cost-effective marketing strategies that use your money wisely.

We offer a free consultation to discuss your needs and show you what we can do to help. Call Lawyers Marketing Associates (LMA) today at 919-637-9144.

What is the Average Spent on Law Firm Marketing?

An average spending of around two percent of gross revenues is common in law firms but varies according to individual needs and factors. Many law firm management consultants recommend spending between two percent and five percent for most practices. According to reports from the Huffington Post, the AM Law 200 firms spend 2% of gross revenues on marketing expenditures, whereas medium to large-sized law firms spend anywhere between 2-5%, and smaller law firms tend to spend between 5-10%. In a major metropolitan area where competition is fierce, expenditures should generally be no less than $2,500-$3,000 monthly.

Setting Goals for Marketing Spending

While investing in marketing is important, determining the best way to spend your marketing budget is also important. To make this determination, you need to examine your individual goals. For example, if you want to expand your practice to a new area, you need to increase the budget to attract new clients.

Goals for marketing usually fall within the following areas:

1. Retention marketing to keep former clients and remind them about your existence. Former clients may need your services again or recommend you to others, and it is less expensive to keep them than to acquire new clients. In general, for every $7 you spend on acquiring new clients, spend $1 on retention.

2. Acquisition marketing to acquire new clients. To attract new clients, you would have to focus on areas that include:

  • Search engine optimization (SEO) to bring visitors to your website by improving your site’s position in the results that come up in searches. You want your firm to show up on the top page, and the higher on the top the better.
  • Social media such as Facebook, LinkedIn, and YouTube to increase recognition and make your firm seem more human and friendly to clients.
  • Paid advertising
  • Video marketing and educational materials
  • Offering services and information, such as giving presentations and seminars and writing articles and pamphlets.

Factors to Consider in Determining What to Spend on Marketing

Your individual needs are most important in determining how much your law firm should spend on marketing. To get a better idea of what is right for you, consider the following factors:

  • Your marketing purpose – The main purpose of marketing is to generate leads that you are able to convert to clients.
  • Type of law you practice – Some areas of law require more investment, such as personal injury and litigation.
  • Type of clients you are targeting – For example, marketing to consumers requires spending more to get their attention. Areas such as family law, estate planning, real estate, criminal defense, and personal injury handle cases for individuals rather than companies and corporations and may have to spend as much as 10% of firm revenue on ads and marketing activities. 
  • Your geographical area and the competition there – Rural areas may have fewer competitors for clients than densely populated urban area, but rural clients may be spread over a larger area. The more competitors and larger the area, the more you may need to spend.
  • Your revenues and profit margins.The more revenue, average client expenditure, and profit margins, the more you can afford to spend on marketing.
  • Your clients’ needs – Do your clients need help immediately, such as after a personal injury accident, or do they have time to make a decision, such as to plan an estate? The longer they have to decide, the more you may need to spend on marketing to them.

By considering these factors, you will have a better idea of how much you will need to spend on a marketing plan to provide the revenue and growth you need.

Determining Your Return on Investment

To see if your marketing dollars are being spent wisely, you need to have an idea of what is your return on your marketing investment. It is a good idea to invest in advertising and marketing where you can measure the direct result of your investment and efforts. Consider the following:

  • Cost per Lead or Client Acquisition – how much you have to spend to get a new lead.
  • Quantity and Quality of Leads — how many leads the source generates for your practice on a monthly basis, and what percentage of these leads you are able to convert to clients. What is the quality and average case value of the leads?
  • Consistency of Leads – Can you keep getting new leads from a source consistently, or is the lead production sporadic or seasonal?

Contact Us for Help with Marketing Spending and Strategies

You have the legal expertise to build your law firm, but no one will know about it without marketing. Call Legal Marketing Associates to discuss the individual needs of your firm and let us review your existing marketing strategies and show you how to get the most out of your marketing dollar.

Call us today at 919-637-9144 to get started.