Using The Computer As A Marketing Tool

by John W. Olmstead, Jr., MBA
Copyright 1995 by Olmstead & Associates. All Rights Reserved.

The use of computers is escalating in law firms of all sizes across the country. As firms become more experienced in the use of computers in the typical application areas such as word processing, billing, and accounting - they begin searching for additional application areas beyond merely back office operations.

Attorneys are beginning to use computers in areas such as case management, litigation support, and legal research which assist the attorney in the practice of law. However, an often neglected function within the law firm is the measurement, management, and control of the firm's marketing program.

The concept of marketing of legal services is becoming an accepted way of doing business in the legal profession. Law firms of all sizes and types are embracing strategic planning and are formulating strategic and marketing plans. Although specific approaches and marketing vehicles may differ - marketing (or business development strategies) are being adopted by law firms representing individual clients (such as plaintiffs in personal injury cases) and by law firms representing institutional clients (such as major corporations).

As marketing programs and advertising campaigns proliferate, firms must develop a method of implementing, measuring, managing, and controlling the programs and campaigns. Although promotion often receives the most attention, the process of marketing involves all of the following phases:

• Service Mix Strategies
• Pricing Strategies
• Promotion Strategies
• Service Delivery Strategies

An effective marketing plan must deal with all of these phases in the marketing mix. The end result desired by the law firm is to leverage its marketing resources and adopt a strategy which employs the smallest number of resources to produce the greatest number of clients. The firm must insure that it receives maximum results from its marketing dollar. Client maintenance and replacement is the number one concern of law firms of all sizes.

Once the marketing plan and advertising campaign is put into place - results must be compared against initial objectives. Some form of a feedback system is required. The law firm must now be able to ascertain and accomplish the following:

• Send mass mailings and promotional letters to client and targeted prospects.
• Send phased automatic diary mailings to existing clients in order to keep in touch.
• Print labels for newsletters.
• Measure the effectiveness of the marketing program and the advertising campaign.
• Determine and budget appropriate advertising expenditures.
• Evaluate the effectiveness of specific advertising vehicles.
• Track and review client profitability.
• Identify key ratios such as prospect response ratios, advertising cost per case or matter, retained cases, etc.

Computers can dramatically aid in the data collection, report generation, letter and diary generation, and other requirements for an effective marketing feedback and control system. An effective database system providing appropriate demographic, financial, and client related data is essential. While specific data elements may vary from firm to firm, the following are representative illustrations:

• Prospect/Client Name.
• Promotional Campaign.
• Address, Phone, and Other Personal Information.
• Geographic Region.
• Date of Inquiry.
• Age.
• Sex.
• Race.
• Type of Case.
• Estimated Fee.
• Source (i.e. Radio, TV, Referral, Newsletter, Direct Mail, etc.).
• SIC Code.
• Company Size.
• Income Level.
• Area of Law.
• Annual Revenues.
• Final Result (Accepted, Rejected).

In order for such a program to be effective the information must be captured at the prospect level at the time the prospect initially contacts the law firm. Specific financial information pertaining to promotional and marketing costs must also be tracked and prospects should be related to the specific campaigns or marketing vehicles. Full system integration should exist between the marketing/prospect system; the law firm's general ledger, and docket system; and the firm's word processing system.

Law firms should avoid the temptation of acquiring or designing stand alone "non-integrated" databases. We are currently working with numerous law firms that have piecemeal systems. Clients must be opened in a separate system for case management, billing, conflict of interest, docket, and a database for word processing. The level of redundancy is unmanageable and the potential for error is high. The acquisition of a non-integrated marketing/prospect system will simply increase the problem.

Law firms should evaluate computer software from a systems viewpoint as opposed to viewing systems in isolation. Software developers should begin developing software (such as billing systems, case management systems, and word processing packages) with adequate flexibility for additional database requirements such as marketing/prospect systems.

Marketing/prospect systems will become an integral integrated component of future law office computer systems.

John W. Olmstead, Jr., MBA, CPCM is a legal management consultant and president of Olmstead & Associates, a legal management consulting firm based in St. Louis, Missouri with offices also in Lexington, Kentucky and Des Moines, Iowa. The firm provides management advise and assistance as well as computer system implementation assistance and training to law firms and corporate and governmental law departments and is presently serving clients across the United States.

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