In a world where buyers have a multitude of choices, service providers must find and promote a point of differentiation. Certs, the breath freshener, promotes a glistening drop of Retsyn as the secret to its effectiveness. What’s your Retsyn?
For law firms, differentiation can be challenging. “But we’re good at everything!” protesteth the lawyers, who are hesitant to declare a single specialty lest a potential buyer overlook them. Indeed, sophisticated buyers might miss a law firm if its marketing doesn’t sufficiently promote its deep expertise in some niche area. But a potential buyer is also likely to overlook firms whose marketing approach is essentially, “We do everything, and we do it all well.”
Now, there’s nothing wrong with having and promoting broad expertise in a variety of areas. Consumers readily grasp the concept that some providers, say Walmart or Target, offer a wide range of categories, but no one category is particularly deep. This appeals to consumers seeking the convenience of one-stop shopping, often coupled with discounted pricing. But consumers also know that, say, for the most technically superior and cutting edge televisions, they must instead visit an electronics boutique. And for a deeper selection of bedroom furniture, they might need to visit a furniture retailer. For some law firms marketing their broad capabilities across a wide array of legal needs, marketing as a general purpose firm may be a suitable marketing approach.
But sophisticated buyers with specialized needs in a specific industry vertical, or seeking deep expertise in a narrow area of law, will skip right past the law firms promoting expertise in everything. Their objective is to find the lawyers who have been there before, whose learning curve is limited to the client’s particular fact pattern rather than the area of law or industry or regulatory environment. Gone are the days when lawyers might declare, “Let’s win the work first and figure out how to do it later.”
Law firms can also promote differentiation in areas other than legal specialties. Having a global footprint with numerous offices can be a differentiator. So is having deep expertise in local courts’ rules and procedures. Or offering a toll-free number and a complimentary consultation.
Of course, the point of differentiation matters only when it has meaning to the buyer, i.e., when it serves as a useful reply to the client asking, “So what?” A vehicle’s four-wheel drive capability that cuts through the deepest snow is not a benefit to the proverbial little old lady living in the sunbelt who drives once a week to her worship service. A global footprint may be a meaningless feature for a client who does no business internationally and has one specific legal need. But it may be a significant benefit to a client operating in numerous countries who needs help seamlessly untangling complicated trade regulations in multiple jurisdictions.
The point of differentiation must be consistent with the firm’s strategy: Who is the target client? What demonstrable and profitable skill or capability do we offer? How does this skill or capability benefit the target client? How does this skill or capability provide an advantage relative to the competition? If a law firm’s leadership can’t or won’t address these fundamental questions for its key areas of differentiation, no marketing campaign will overcome the incompetence.
To get started in identifying one or more points of differentiation, it’s helpful to work through some of the most common types, in increasing order of effectiveness.
Feature/Function. In a law firm, this is a legal specialty such as litigation, or intellectual property, or environmental contamination. Promoting the specialty itself is rarely effective, which is why good content marketing campaigns convert essential skills into stories that have meaning to specific buyers. “We represent employers in labor disputes” is less impactful than a blog series on “How trucking companies should incorporate new regulations on workplace discrimination.”
Convenience. Law firms promoting one-stop shopping convenience, e.g., the lawyers hope to provide numerous services to each client, tend to offer pablum such as, “We serve the needs of small business owners and high net worth individuals in the quad-state area.” A more effective approach is to be specific: “We provide an annual comprehensive business review for each of our clients, highlighting areas of current or potential business risk or opportunity, and then provide guidance to relevant resources to address areas of priority.” (If you want to adopt this message of differentiation, start first by designing the business diagnostic, not the marketing copy.)
Exclusivity. There are some legal issues so complex or so subject-matter specific that having a lengthy track record is its own point of differentiation. Trouble is, lawyers tend to believe their expertise is far more elusive than it really is. Pundits have argued that much of traditional lawyering consists of special access — access to case law, statutes, regulations, forms, and procedures — rather than how to apply these learnings in our precedent-based system. Technology and other factors have made access to these resources relatively ubiquitous, hence the advent of self-help legal tools for consumers, and alternative business providers for corporate law departments. What remains exclusive are creative ways to interpret and apply case law, statutes, and regulations to unique fact patterns. The market still needs smart lawyers with exclusive knowledge, but law firms need to do a better job of incorporating the clients’ views of what’s truly exclusive. They should also be mindful that today’s specialty is inevitably tomorrow’s commodity.
Price. Pricing differentiation messaging can be easy: “We’re the low-cost provider, and we’ll meet or beat any competitor’s price” is easily understood. So is, “Our premium hourly rates reflect that we have the deepest expertise and deepest bench.” These reflect opposite ends of the market. But pricing differentiation messaging can also be more nuanced: “We have the deepest expertise, and this allows us to provide expert services on a fixed fee basis and at rates far lower than our competitors with less expertise,” is an excellent differentiator in a crowded market where both price and expertise matter.
When lawyers lose a bid to another law firm, they rarely lament being bested by the deeper expertise of the competition. Instead, they cite “The competitor undercut us on price to buy market share, and they’ll inevitably pull a bait and switch on the client,” or its cousin, “The client selected a huge firm with high rates and a global reputation to prevent criticism if the deal goes poorly.” Of course, these two situations still happen, but primarily with unsophisticated buyers, and this is a dying breed. Law firms converting their deep expertise into profitable and strategic pricing differentiation are quite content for competitors to perceive these actions to be foolish.
Quality. In many markets, one path to higher profits is to offer high-quality goods or services to buyers who can discern the difference and who have expressed a clear desire for high quality. But here’s the thing: the buyer defines quality. And the buyer decides when higher quality is necessary. A common lament from tone-deaf lawyers is that buyers, or the evil bean counters in legal ops or procurement who work with them, only want low price, not high quality. A law firm can’t simply declare its offerings to be high quality and expect to charge high prices to buyers who have done their homework, who have identified numerous alternatives and substitutes, and know exactly what price to pay.
Many buyers equate a law firm’s ability to reduce surprise, the ability to provide matter budgets, the ability to provide some predictability and manage expectations for a thorny legal issue, to be a sign of experience, a sign of quality. Consistency is also a sign of quality. If there are multiple lawyers in the same firm who tackle a similar task in different ways, the buyer may not be able to explicitly identify which approach is the highest quality. But the buyer certainly knows that the lawyers also don’t know how to recognize high quality… or they’d settle on one approach. A law firm or practice group operating without some sort of organized client feedback program to better understand what quality looks like is literally incapable of honestly promoting quality legal work.
Service. It’s not uncommon for businesses to promote “Service with a smile” or some related service trope. The law firm version is “We return all calls promptly” or “We never sleep” or “We have a collegial culture” or, as one firm leader declared when asked to describe his firm’s competitive edge, “We’re just nicer than the other guys in town.” Yawn. Providing exceptional service is, or should be, the cost of entry to the high stakes table. Sadly, too many lawyers operate with a quaint and outdated “The best marketing is doing quality legal work” mindset. This is really just another way of saying, “So long as I secure the outcome my client wants, I will do whatever I want and charge whatever I want.” Next.
More progressive law firms are embracing service as a differentiator. They’re building on the “We have multiple practices and multiple offices to serve your many needs” by offering “We promise that when one of us knows your business, all of us know your business” or “All of our lawyers adhere to our 3-step process for scoping, adjusting, and communicating so you will never be surprised by an invoice” or “Our continuous improvement culture means that we’re constantly looking for new ways to deliver our services efficiently and cost-effectively” and more.
While a McDonald’s menu may change around the world, the customer experience of visiting a McDonald’s feels substantially similar in any location. Law firms that operate as independent fiefdoms with partners that sharing only a logo tend to eliminate substantial client benefits. Law firms and other legal service providers that embrace process improvement and project management as a way to offer a consistent service posture in any office or practice are enjoying significant advantages.
Differentiation is critical in a crowded, competitive marketplace. Does your law firm offer a unique and specialized skill? Does your breadth and depth offer clear advantages to clients? Do your individual practice groups enjoy the same positioning, or, more likely, do some practices operate in a crowded space while some occupy more rarified air? Do your prices, product offerings, and service posture reflect what your target clients specifically seek, or does your positioning instead equate to what feels good to the partners? Trying to be all things to all people so as not to lose out on a single potential billable hour is a very loud way to broadcast the message, “We’re resolutely mediocre.”
When Certs began to market its “golden drop of Retsyn, the miracle breath purifier that makes your breath clean and fresh,” there were undoubtedly few people anguishing over the relative lack of Retsyn in their diets. Certs found an opportunity to differentiate, coined a new word, and promoted its new differentiation relentlessly. Law firm leaders must do the same: What’s your unique differentiator? What compels clients to hire you? What compels them to hire you again? Find your differentiation, make some noise, and stand apart from the crowd!
Timothy B. Corcoran is principal of Corcoran Consulting Group, with offices in New York, Charlottesville, and Sydney, and a global client base. He’s a Trustee and Fellow of the College of Law Practice Management, an American Lawyer Research Fellow, a Teaching Fellow at the Australia College of Law, and past president and a member of the Hall of Fame of the Legal Marketing Association. A former CEO, Tim guides law firm and law department leaders through the profitable disruption of outdated business models. Tim can be reached at Tim@BringInTim.com and +1.609.557.7311.