TechnoLawyer

Originally published on March 22, 2010 in our free SmallLaw newsletter.

I love marketing in every form. I've tried advertising on radio, on TV and in print. I've sponsored charitable events. I've put up billboards and sent direct mail. I've printed brochures, flyers, booklets, books, and white papers. I've held seminars for prospective clients, lawyers, mental health professionals, accountants, doctors, and clergy. I've served on boards and volunteered for charities and political campaigns.

That was my warm-up act. I could spend hours telling you how I got on Geraldo, CNN, and Dr. Phil. I could tell you how I've attracted the attention of the TV networks and how I've done radio shows in Europe. I've written articles and letters-to-the-editor. I've spoken at CLEs, produced podcasts, and penned a weekly newspaper column. My list of marketing activities is endless and I've loved all of them.

But the most effective and efficient marketing I've ever done is having lunch with a referral source. It works. It generates business. It's where you should spend the bulk of your marketing energy.

It's important, however, to apply some metrics to your lunches. You should measure your effectiveness, make predictions, and determine if what you're doing is working. At each lunch, you should strive to improve your numbers. Most importantly, you should schedule enough lunches to keep your calendar full.

How Many Lunches Does It Take to Generate a New Client?

The answer requires a bit of math. It's important to master these calculations because it helps you figure out how much time to spend on marketing to keep your calendar full. It's not a one-time calculation. Your effectiveness will improve and your base of referrals will expand. Calculate now and keep up with your data as you build your practice.

Here's my formula:

1. Determine what percentage of your referral sources want to refer to you after a meeting. Not everyone will like you. You won't connect with everyone. Let's assume that 90% of your prospective referral sources become actual referral sources.


2. Some referral sources actually have someone to refer, but others don't. Let's assume that 40% of referral sources will have someone they can refer right now.


3. Some referral sources like you, have a prospect to refer, and still won't take action. They just can't be bothered to make the call. Let's assume that 80% will actually take action.


4. Once the referral source makes contact with their prospect, it's then up to the prospect to take action. Some won't act. They aren't ready or they might change their mind. I generally assume that 50% of clients will rely on the referral and take action by scheduling an initial consultation.


5. Once the prospective client comes in for a consult they're pretty likely to retain. Referred clients have a very high retention rate since they've been told how great you are by someone they trust. I assume that 80% of these prospects will retain at some point.


6. Unfortunately, some of those prospective clients won't be ready to move forward for a while. They need time for circumstances to change. I usually assume that 50% of the referred prospective clients will take action this month.

In mathematical terms:

New Clients = (Number of Referral Source Meetings) (% Who Like You) (% Who Have Prospect) (% Referral Source Acts) (% Prospects Who Schedule Consultation) (% Prospects Who Like You) (% Prospects Who Take Action Now)

Applying the Client Development Lunch Formula

So how does all this shake out when you apply all the assumptions I've incorporated in my formula?

To get one retainer this month, you need to take 20 referral sources to lunch or coffee. If you need 3 new clients this month, you need 60 referral source meetings. That's a lot of lunch (one of my friends does two a day, one at 11:30, one at 1:30). Very few of us have time for 15 referral source meetings each week. Of course, if you're just starting out, you've got plenty of time and there's no better way to spend it.

Realistically, you only need to have this many meetings in the beginning. Once you start to grow your network you'll reap the benefits of exponential growth. This month you'll get a few referrals. Next month you'll get referrals from last month lunches. You'll get calls from some of those prospective clients who weren't ready to act. The snowball will grow and grow and you'll find it takes far less energy to keep it rolling.

Success doesn't mean you should dispense with the metrics. Keep measuring your effectiveness. Make it a sport. Keep improving your stats. Figure out where you're winning and where you're losing. If your referral sources aren't calling their clients to pass along your information, start teaching them how to make the referral. If prospective clients aren't retaining you after a consultation change your approach. Use the data to improve each and every month.

As a bonus, you'll a great time getting to know people. Keep up with the numbers as you go along. Measuring your lunches will result in a thriving law practice.

Written by Lee Rosen of Divorce Discourse.

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