Today, business is built from meaningful relationships – especially for lawyers. Learn why relationship selling is an important tactic and how you can use it to attract and retain high-value legal clients.
A new B2B marketing tactic is becoming popular with the legal business development (BD) community. Enter ‘Relationship Selling’, a relationship-driven alternative to traditional law firm marketing practices.
Relationship Selling is a must-know for lawyers and legal BD professionals. Used correctly, there’s no better strategy to maximising client revenue and growing a law firm.
And, unlike marketing tactics that come and go, Relationship Selling stands the test of time, as a valued pillar of sustainable law firm growth.
In this article, we’ll unpack the benefits (and challenges) of Relationship Selling, to help you decide how it can integrate with your firm’s client growth strategy.
What is Relationship Selling?
Relationship Selling is about building long-term relationships with clients. You the ‘seller’, position your services in a way that’s highly personalised to your client’s exact needs.
Success is measured in terms of engagement with an existing client (e.g. the number of interactions with different decision-makers at the client firm). By investing time to retain a select basket of clients in the long term, Relationship Selling can help achieve the holy grail for a service business: recurring revenue through rock-solid client loyalty.
Because of this focus, Relationship Selling makes perfect sense for law firms. As a high-value purchase, legal advice entails high levels of financial risk for the buyer. The lawyer’s trustworthiness and perceived expertise are decisive factors in the purchasing decision. These important perceptions can only be built in the context of a sustained relationship.
If a law firm adapts the Relationship Selling approach, it must be prepared to prioritise quality over quantity – at least when it comes to numbers of clients. Rather than seeking out many clients with low-profit potential, Relationship Sellers identify and invest their resources into a selected basket of clients with high lifetime profit potential. They understand that this is a more rewarding and beneficial approach in the long run.
How is it different from traditional marketing?
Before we go deeper into two key benefits of Relationship Selling, let’s understand the style of marketing it aims to improve on.
Traditional selling aims to acquire as many new customers as possible to grow a law firm. Law firms operating with a traditional selling mindset prioritise tactics that promote the equivalent of one-off sales – a revolving door of new clients with one matter per client.
Importantly, there is an assumption that growth is primarily achieved by landing new clients. If a client chooses to return to the firm for a second matter, the firm will happily take the work – but this is not a prioritised source of revenue growth. Clients are understood to have low/one-off value, and continued contact is not incentivised by management.
Since the emphasis is on acquiring rather than retaining clients, junior resources are used to deal with clients. A good example of this is a hotel resort on a tropical island. While hotels appreciate repeat customers, the bulk of business is from visitors who never return – so it wouldn’t make sense for the hotel manager and owner to greet and farewell each customer personally.
A law firm that operates on new client acquisition, can probably survive and even grow for many years. But it won’t be able to settle into a sustainable rhythm with its existing client base – which would be predominantly made up of one-off clients.
Instead, the firm will have to return to the market every year to find undiscovered pockets from which to find more of these ‘one-off clients’ that make up the majority of annual revenue.
The Relationship Selling Approach
Let’s compare the above scenario to a law firm using the Relationship Selling approach. Since the goal is to retain the client for their future legal needs, mid-level and senior resources are incentivised to contact clients.
There may be a dedicated BD professional providing valuable information and thought leadership. Together, the staff enhance the trust and loyalty of key existing clients to the firm.
The Relationship Selling law firm gains one-off clients each year, but it is understood that the main source of growth is retaining and becoming the preferred law firm for existing clients. The focus is on recurring revenue, up-selling and cross-selling, rather than high volumes of one-off revenue. This allows a pathway towards sustainable firm growth.
A law firm using Relationship Selling will also face little threat from the traditional selling firm. Clients feel that their needs and preferences are well understood and an ongoing business priority. Therefore, there’s little sway on their ongoing loyalty.
An example of relationship selling in action
In a hypothetical Relationship Selling firm, the client relationship does not end after the initial piece of legal work is complete. Instead, the firm seeks outs feedback, adds ongoing value and monitors client needs proactively.
To seek out feedback, a senior associate reaches out by phone, a fortnight after the work is invoiced and paid. This feedback is reported back to the team and kept on file, with preferences and suggestions noted.
To add ongoing value, a BD professional organises a short personalised educational content piece on the potential long-term risks of a joint venture, for a client. This is sent to them a couple of months after the work is complete with an offer to answer any more questions they may have since the completed work.
To monitor the client’s needs, a partner catches up for coffee with the client’s head of procurement, to monitor the implementation of the initial legal advice.
An associate meets up with a member of the client’s legal team to see if there have been any significant changes or legal challenges. These are kept on file at the law firm and a following educational piece is written and sent.
Good client relationships involve a degree of reciprocity – and this ongoing relationship action is not about pushing legal advice on the client.
This example illustrates how the client is engaged with the law firm at different levels. It allows for personalisation that’s needed to win over the buyer of a high-ticket purchase (legal service) when the need next arises.
Is Relationship Selling right for you?
Relationship Selling offers clear benefits – particularly when it comes to sustainable firm growth. But to make a balanced evaluation, it’s also important to evaluate a handful of short-term challenges when implementing Relationship Selling:
1. Time investment: It takes time and effort to engage with multiple decision-makers at a client firm, provide valuable legal updates and seek feedback on your services. Through a traditional selling lens, this kind of time investment is hard to justify, since each client is seen to have limited value. However, if each client is understood to pay off in the long run through repeated business and potential cross or up-selling, then the investment of time in the short-term is justifiable.
2. Involvement of middle-to-senior staff: Given that traditional selling focuses on customer acquisition rather than ongoing loyalty, the need for middle-to-senior staff to hear feedback and personalise services is overlooked. Relationship Selling requires more middle-to-senior staff involvement and buy-in and may require cultural change so that they understand their responsibility in nurturing long-term client relationships.
Even with the short-term ‘cons’ when implementing Relationship Selling revealed, we think it’s fair to say that the long-term benefits outweigh the costs.
Lawyers and legal business development professionals are always looking for the next big thing to gain an edge in the competitive legal market – and by our predictions, this year will be no different.
If traditional selling is like trawling the deep seas with a mile-long net, Relationship Selling is like fishing with a harpoon – it allows law firms to zero in on a prized trophy fish before striking with accuracy and certainty.
As a marketing framework that allows law firms to upsell existing clients with great efficiency, it makes sense for law firms to draw up their own list of key clients and put Relationship Selling practices into action today.