The performance of every law firm function should be assessed on a regular basis, and that includes legal marketing. Key Performance Indicators (KPIs) of law firm marketing efforts are some of the most significant measures of success because they examine your firm’s ability to withstand the competitive legal marketplace and attract new clients.
KPIs are quantitative performance measurements used for the analysis and monitoring of business activities. They help identify which part of your law firm marketing strategy is working, and which parts are ripe for improvement.
Effective KPIs should be linked to specific business strategies and involve relevant criteria that align with your firm’s priorities. For this post, the business strategy is a legal marketing plan, and the priority is your law firm marketing goal. With these specifics in place, your practice can use the following KPIs to achieve critical points of analysis and measure progress made towards your law firm marketing goals.
Marketing KPIs for Law Firms
Marketing can take up a significant percentage of a law firm’s budget, so you need assurance that these costs are resulting in comparable returns. You need to know whether or not your marketing strategies are actually bringing in new clients and increasing revenue.
These top Marketing KPIs will help your law firm collect and analyze the data needed to make informed legal marketing decisions:
Leads
Leads are consumers who contact a firm with the potential of creating an attorney-client relationship. The more leads accumulated, the more opportunities for conversion and revenue generation, so it’s important to have an automated software system in place to track leads. Many law firm Client Relationship Management (CRM) software platforms include tracking software that helps firms get the most out of their prospect lists, with easy and organized lead tracking.
Acquisition Costs
Acquisition costs are those associated with marketing efforts, including the costs of advertising, promotions and legal marketing email campaigns. This KPI breaks down these costs per client gained using the following formula:
Customer Acquisition Cost (CAC) = Total Cost of Sales & Marketing/ Total Customers Acquired in that Duration
The resulting number exemplifies how much money your firm typically spends on the acquisition of each law firm client. With this data, you can then determine whether the average revenue generated by clients exceeds the CAC, which is a preferred result because it indicates a positive return on your law firm’s marketing investment.
Revenue
Profit is the main goal of all law firm marketing efforts, so a revenue KPI is essential for analyzing the effectiveness of your legal marketing processes. With customizable legal data reporting, your firm can clarify which marketing efforts have resulted in increased revenues and which are costing more than they are benefitting. Revenue KPIs help your firm be more targeted in its marketing plan through the detailed assessment of its current performance and more informed decisions for future goals.
Website Conversion Rate
The website conversion rate uses the traffic-to-lead ratio to represent the number of website visitors that actually turn into leads within a given time period. The higher the ratio, the higher the leads, which equates to higher levels of revenue for your law firm. This KPI can also be used for your firm’s other online legal marketing campaigns to help determine which types of content bring in the most leads. A conversion can be defined in a variety of ways, but for the purposes of this KPI, once an online viewer or reader becomes a viable law firm lead, a website conversion has occurred.
Bounce Rate
The Bounce Rate measures the percentage of visitors to your law firm website that leave with no intention of exploring beyond the landing page. This is calculated as follows:
Bounce Rate = (Single-page sessions / All visitor sessions)100
This KPI helps you analyze the effectiveness of your website’s design and attractiveness to potential leads. It is also a good indication about the strength of your online marketing content. A high bounce rate could mean that your legal content is not adequately catching the attention of potential clients.
Organic Traffic
Most law firm prospects start their hunt for the right firm with an internet search. They open a search engine and enter terms like “Chicago divorce attorney.” Organic traffic are those visitors that find your law firm website through these keyword searches. Measuring this metric allows you to gauge the success rate of your online marketing content, your keywords, and Search Engine Optimization (SEO) efforts.
Response Time
Response time measures the time between a lead’s first contact and your company’s response to them. This KPI is an important factor when it comes to converting leads into paying law firm clients. Delays in lead communication could mean a lost opportunity and a waste of marketing investments because leads will look to other law firms for the legal representation they need.
CRM software for law firms can be extremely useful for this KPI. These platforms can provide detailed response information. Use the response time KPI to ensure that your firm is consistent with timely response times that meet or exceed those of your competitors.
Conversion Time
This KPI measures the time it takes for interested consumers to become law firm clients. It reveals the effectiveness of your law firm marketing strategies and tests the likelihood of turning a lead into a paying client. Extended conversion times may mean that potential leads are on the fence about your law firm and considering other options. It may also indicate an internal law firm problem where your firm is not initiating the legal client intake process in a timely manner.
Check out our post to explore proven marketing techniques for helping mass tort practices attract viable leads and convert them into paying clients.
KPIs Help Assess and Improve Law Firm Marketing Strategies
Marketing is essential for law firm success, but strategies should be reviewed on a regular basis to promote the most effective use of firm resources. With these KPIs in place, you can create a valuable analytic springboard for law firm marketing success.
This post has been updated for accuracy and comprehensiveness.
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