There is an old, two-way adage that you can use to better focus your new client acquisition strategy. Translated to legal, it’s the simple rule that 20% percent of your clients probably take up about 80% of your time.
On the other hand, 80% of your firm’s revenues may very well come from 20% of your clients. This seems like a natural and sensible assumption at first. So what’s the problem? Every business has their “go to” customers and maybe it’s those clients who are most deserving of the bulk of your time.
Here is the problem: It’s most likely that those 20% who take up 80% of your time are not the same 20% of those who make up 80% of your revenue. In fact, they’re probably the opposite.
What exactly does this mean to you as an attorney? It means that those two very different 20% groupings represent a chasm in your client profile.
Here are a few practices that will help you bridge that chasm and focus your client acquisition strategy:
- Run reports – Find out what each of your clients is paying and how much of your time and resources they are taking up.
- Make a spreadsheet – Put all your client snapshot data into spreadsheet format. This will make it easier to crunch the numbers. Track what you’ve actually been paid, along with what your firm has put into the relationship.
- Do the math – It won’t take long before a pattern emerges. You’ll now be able to quickly identify your A clients and your D clients.
- Analyze – Separate the two categories as distinctly as you can. You will most likely have substantially more D clients than A clients. Find out what each category is worth to you and how much time you spend on those clients. The numbers will most likely steer you automatically to the A’s.
- Shed – In this tough economy, no one wants to lose valuable clients. Especially to the competition. But, ask yourself the following question. Are you better off spending time acquiring more A clients or toiling endlessly with a larger pile of D clients? The answer for many is the former.
- Move your target – Change how you target and aquire new customers. Model the acquisition strategy on targeting those potential clients that most closely resemble you’re A clients.
In the end, you’ll probably have to make some tough decisions about what types of clients you will want to represent going forward. In a future post, we will examine some of the ways you can focus and hone that client acquisition strategy to help you target potential clients that will take up less of your time and make you more revenue.