Golden Practices

Plan Your Marketing Budget

Q. Just wondering if you have any articles or thoughts on best practices in establishing a marketing budget -- why do it and how? (question from a law firm marketer in Des Moines, Iowa)

A. There should always be a marketing budget...even my three-person company has one.

In fact, I just checked my expenditures and they run 3-5% of current year projected revenues--the amount we generally recommend to firms in growth mode or 'get up to speed' mode.

Maintenance mode would be 2-3%. Invest at least in maintenance of basic marketing "stuff" even if business growth isn't a long term goal. You have to consider routine attrition. If you are in a project business rather than one with on-going or recurring revenue, the amount should be greater than 2-3%.

Marketing budgets should be based on marketing plans.

If there's no plan, the budget essentially becomes the plan. (Much as when firms have no strategic plan, the compensation system "becomes" the strategic plan by driving behaviors in a particular direction.)

In a firm with a marketer but without marketing plans or budgets (and there are many such firms), I honestly have no idea what drives the marketer's job description, but I'd predict the marketer is fairly frustrated wondering from day-to-day what s/he should be doing and whether s/he is having much impact. And so are the partners. (If a partner in such a firm is reading this, your marketer needs a plan--for their sanity and yours and, oh yeah--for your firm to experience progress.)

When we work with firms, we usually combine the plan, time line, and budget into a single document. This keeps things simple. We find it is usually sufficient to break the budget down by quarter--monthly is typically more detailed than necessary for firms under 200 people.

What Goes In The Plan/Budget

I prefer to spend most marketing dollars and, more importantly, time, on things that will result in actually achieving a measurable goal:

1. More business from specific existing clients
2. Specific new clients
3. Heightened awareness and increased referrals from specific referral sources

I find most firms don't normally include these three categories in their marketing budgets with the exception of periodic canned newsletters, random sporting events, and occasional client seminars.

Instead, firms allocate the bulk of their marketing dollars to the "black hole" of marketing--a category I'll call infrastructure. This category includes such items as brochures, static websites, general advertisements, announcements, newsletters, holiday cards, press/media relations, etc.

Why?

Well, I have a few theories on that. They aren't pretty.

• these items are relatively easy
• these items can be easily delegated (require little partner time)
• these items keep the marketers busy

The problem?

While these infrastructure things can be useful, even requisite, unlike the above items that require some time and attention of practitioners (for marketers cannot market in lieu of them) none of the infrastructure items can be counted on to result in measurable ROI.

UNLESS, that is, those ads, newsletters, or non-static websites involve disseminating compelling, relevant information about specific areas of expertise to very targeted audiences.

Yep. Specialties. Practice groups. Niches. Whatever you call them. Back in the early 90s, my firm's partners learned it was good to be viewed as "famous" in an industry--so each sought to be famous for something.

Mind you, they stayed generalists in their day-to-day work, but they marketed as specialists. Now, 15 years later, they focus mostly on those specialty areas where they command premium pricing and their reputations make selling the work easy.

Now we are talking!

Niche focuses are where even the black hole of marketing can start to return value. Industry-specific goals and activities. The marketer can help with promotion and lead generation and the practitioners can be there where the rubber needs to meet the road: prospect, client and referral source interactions.

This is the basis for the marketing plan. The plan will drive the budget.

I'll post again in a few days about specific plan/budget considerations.

The main thing to remember now is that marketing budgets and plans are NEVER one-size fits all. They have to consider who you are, who your market SHOULD be, and what you are realistically able to achieve in a given period of time.

Don't spend marketing dollars foolishly, on an ad hoc basis. Make sure every expenditure is wise and part of a cohesive plan. You wouldn't get into a car and start a long trip without knowing your destination. Same thing here. Begin with your destination in mind.

Law Students Building a Better Profession

An excellent blog came to my attention today (hat tip to Ron Baker and Stephanie West Allen). The blog's purpose is noble indeed:

Law Students Building a Better Legal Profession is a group of students from across the country dedicated to helping law firms and lawyers recommit to a legal profession devoted to effective and efficient client service, to lawyers as people, and to the roots of our profession in service. 

We are working to ensuring that practicing law does not mean giving up a commitment to family, community, and dedicated service to clients. By advocating for reforms to law firms we hope to help keep law both a business and a profession to be proud of.

Take, for instance, their insightful post entitled "Costs to the Profession" in which they provide excellent examples and citations (would you expect any less from law students?) for costs of the current system to Clients, Firms, Attorneys, and Community. This is a MUST READ post.

Another excellent post is "The Real Losers Are Associates" wherein ramifications are discussed to the rising associate salaries. After framing the issue of excalating salaries forcing increases to already high billable hour requirements, they refer to inhouse counsel reactions to crazily-high hourly rates.

“At some point, we’ll say we don’t want any associates on our matters,” said Steve Hantler, DaimlerChrysler A.G.’s assistant general counsel for government and regulatory matters.

The reaction of the bloggers is key (emphasis mine):

Uh-oh.  Many of us go to law firms — at least in part — for the training opportunities.  But students don’t expect to be taken off of matters because we’re too expensive. 

Are we really being billed out at rates clients can’t accommodate?

Should law students take this into account when choosing a firm?

Um, "yes" and "probably so."

I'm delighted to see this blog and see the richness of fresh eyes and thinking on these matters. You can read more on this group at Law.com in "Students Seek a More Reasonable Law Firm Life."

If you hire talented people--or want to--and wish for them to stick around after you hire them, I have three recommendations:

1. I'd strongly recommend you read Law Students Building a Better Legal Profession regularly to stay in touch with the thinking of bright professionals.
2. I also recommend that you frequently and fruitfully 'think about' how to improve your firm in these areas that matter tremendously.
3. My third recommendation is to attend VeraSage Institute's meeting on Oct 22 in Las Vegas. We've made it ultra-affordable so price is no barrier--VeraSage operates as a non-profit entity. It's only $129 and the Rio's room rates are running less than that per night.

Fact is, in order to solve the problems these law students so articulately bring to the forefront, some serious innovation is needed.

At the VeraSage meeting, you will meet and learn from the most innovative law firm CEO in the United States, Christopher Marston of Exemplar Law Partners. Despite being described as a meeting for young professionals, it is really a meeting for INNOVATIVE and open-minded professionals of any age.

Register for the event

Wondering Why Few People Find Your Website?

Professionals tell me they don't get many search engine hits. They wonder what to do to get more traffic from potential buyers.

Should we buy Google AdWords? Pay for SEO services?

Well, maybe. But not without first addressing the real problem--the real problem is this:

When people search for a answers to their problems, they don't type in the name of the solution (cure), they type in the symptoms.

Think about it!

On your firm's website do you describe the symptoms at all? Or just have bullet points listing your cures?

Change the text on your website, accordingly! Then, if you buy AdWords or SEO services, use lots more symptom phrases than cure phrases in your keywords.

A Younger, Hipper Accounting Firm

Great interview on BusinessGears.com picked up from Business Opportunities Blog which publicized two 24 year-old women who started an accounting practice in the UK (Cardiff to be exact).

Sophie Hughes and Lucy Cohen are closing in on revenues (turnover) of almost £120k (about $240K USD) nearing the end of their second year in practice. They have two team members and plans to expand into another city, soon, a few more in due time.

Is this another step in a trend toward breaking free of traditional firms and their stodgy ways? Look at their website and decide for yourself www.MazumaMoney.co.uk.

Their site explains:

Their idea behind setting up the company was to put to rest the stereotypical idea of accountancy and to bring the profession to the attention of young businesses and established companies alike.

Of course, their pricing policy caught my attention, too.

...All these are offered on a “mix and match” basis with a bespoke price to suit your needs. You can even pay monthly so you don’t have to worry about a big accountant’s bill at the end of the year.

"Bespoke" if you're unfamiliar with the mostly British term, means tailored or customized to your EXACT specifications.

The interviewer asked: "It’s quite unusual to have a female-owned and run accountancy…"

Sophie: Definitely, and that’s probably why we’ve had a fairly good reception.

A lot of younger businesses definitely like us, although we don’t just want to appeal to women. There is a solicitor’s firm local to us which only has women working for it, but we’re all equals so we don’t want to come across like that.

But we do think women are attracted to us because we are female. And younger people seem to like us because we’re on the same wavelength.

When asked: "What advice would you give to someone starting a business?"

Sophie: Make sure you do a business plan. It gives you something to measure against what you’ve done.

Another one which Lucy always says is that a lot of people tend to work part-time when they’re setting up their business. But if you do that you can’t focus on your business and it’s never going to be as good as you want it to be. If possible just plunge into it, and if after three months you’re not making any money then fine, get a part-time job. But if you don’t give it 100% commitment right from the beginning then it’s not going to give you 100% reward.

Lucy: Don’t be wishy washy. You have to put in 100% effort, but you also have to be 100% sure. There will inevitably be a time, when you first quit your job, when you wake up at three in the morning thinking “Oh my God, what have I done?”

And money will be tight. You’re always one month away from not being able to pay your mortgage when you’re on a salary so it can be difficult if you have a month without that.

But this is where the planning comes into it. You’ve got to be so good at planning and commit yourself fully to it. You’ve got to go for it.

Good luck ladies, I suspect you'll do quite well!

Product and Service Improvement in Your Marketing Plan?

Yes!  If you don't have an Operating Plan as part of your firm's annual Strategic Plan.

Continuing to improve what you deliver (services are products, too) and how well you deliver it meddles in your processes, systems, tools and training...clearly areas "outside" of the marketing department. Or are they?

Product quality, which products you deliver, and the finesse with which you deliver them are pretty fundamental in your ability to survive and thrive, long term. Isn't that why you are in business? 

Product development is essential to evolving with your customers. And to besting your competitors through setting yourself apart. You either want to do altogether different things than your competitors, or do the same things, but do them differently...better.

So the Operating Plan and Marketing Plan should work in tandem and be integrated—not in isolation of one another—to support the Strategic Plan.

But, alas, most firms don't have Operating Plans at all. If yours does, be sure to include these Product Development initiatives in a category I'll refer to, here, as R&D (research & development). If your firm doesn't have an operating plan, then be sure to account for R&D in your marketing plan.

This chart shows essential top-level elements of Operating and Marketing Plans—expanded to show more details in the areas I'm referring to today. Click to Zoom.

 

Focusing on R&D is also focusing on your current clients—part of marketing.

And focusing here ensures you clarify and streamline your processes so that high-quality services are provided as effectively and efficiently as possible.

This impacts good use of personnel capacity, increases the recognition of need for training and delegating, and directly impacts the profitability of each project or job.

Profitability is one of the reasons you "do" marketing, right?

But profitability and marketing all too rarely intersect within firms...a problem worsened when segregating marketing from your operations and vice versa. See my earlier post, "Don't Separate Marketing From Strategy" for more on this.

Every critical operating or marking initiative shown in my chart needs to be interwoven into your team members' personal action items or they are likely to go undone. Placing product/service-related items in marketing plans is not unreasonable. Mentoring and people development is another area I often place into personal marketing plans.

I suppose this really turns an Individual Marketing Plan into an Individual Practice Plan and that is a-OK. Call it whatever you like. But ignore these crucial activities at your marketing's peril.

Don't Ruin Your Blog

I read a good post today on Business Gears.

Ted Demopoulos writes a strong blog called "Blogging For Business" chock full of tips for B2B bloggers. He is a Business Gears contributor and his post, 5 Ways to Ruin Your Blog is what caught my eye. With perfect sarcasm, he defines some bad blogging behaviors.

IMHO, accountants, lawyers and consultants should especially heed numbers 2, 3, and 4.

1) Don't stay on topic!

Ahhh, you just had a baby -- please post a couple dozen pictures and blog on nipple soreness and whatever else for a few weeks. We won't mind, really. And if your college curling team or favorite NFL team is in the finals or Super Bowl, please post about it for days on end. If you care then we must care...What were you blogging on anyways?

This "don't" is why I seldom post on personal topics. (I sure hope it's not too much! If it is, do tell me!) He's right. As a blog reader, I can enjoy the very occasional personal or tangent post but, for the most part, it's a little disappointing when your fave business author begins to talk politics, sports, or hobbies more often than business.

2) Be insular.

Yeah, maybe they call it social media but you can be antisocial if you'd like. Don't link to others. Don't read, never mind comment, on other blogs. Your never ending soliloquy is enough for us to flock to your blog daily for the rest of our lives.

This is something that frustrates me with a lot of lawyers/accountants/consultants who start blogging. Unlike the one-way street of a firm newsletter, blogs are about connecting the dots between others' ideas and your own. This means using links, reading and communicating with others, and becoming part of the community of people who are reading your blog!

3) Write like traditional writing, not speaking.

Conversational, smonversational! We want perfect English, proofread multiple times and worthy of publishing in an encyclopedia (remember those?) or The New Yorker.

Remember that this point is delivered with sarcasm! Your blog post needn't be an article in your profession's Journal. That said, I have recently received a fairly scathing email from someone pointing out a misspelled word. Thankfully, blog software has spell-checkers (if we just remember to use them). But tone is another story. Be yourself and be helpful, not technically perfect.

4) Don't let us know who you are!

No picture, no about us page, nothing personal.

I've found several great BUSINESS blogs where I can't determine who is writing it (especially on Blogger), what company they are with, or how to reach the author. If you're one of these authors, your blog isn't helping you like it should be! Make it easy for readers to see you, learn your name, and contact you.

5) Lots of colors, dozens of fonts, flashing lights, autoplay audio.

Make it look like a casino. Or even MySpace

Haven't seen this too often on biz blogs lately, but good advice...