Vendor Perspective of the LMA Annual Conference

Some years ago when I led a company that was a prominent vendor and sponsor to the legal marketing community, I would regularly take the LMA to task for its tone-deaf and heavy-handed approach to vendors.  They listened and today the association, and the legal marketing community, are far more receptive and embrace the involvement of legal vendors and suppliers.  Don't get me started on other legal associations which appear to regard vendors as evildoers whose role is to send money and logos in return for some token table scraps. So other than one comment, this post does not address the effectiveness of the LMA annual conference from the vendor perspective.  Rather, I will comment on vendor participation at the conference... what worked, and what didn't.

First, the one comment directed to LMA:  The hotel was a beautiful venue and well-suited for a business conference. However, the exhibit hall must be closer to the educational session rooms. No ifs, ands or buts about it.  Periodically a conference planning team will underestimate the importance of this single fact.  That's a mistake.  Since I'm confident every vendor made this point in their post-conference evaluations, I won't belabor it here.

I presented on the topic of managing legal directories, lists and rankings along with Nicole Carrubba of Captivate Legal Marketing.  Though we both have considerable expertise in this area, we spent some prep time on the phone interviewing directory publishers and consultants who specialize in this space.  The publishers, without exception, in some way incorporated the following three assumptions in their remarks: everyone hates us; the competitors stink; and our offering is defined by what the competitors are not.

There are certainly some legal marketers who don't like the very notion of directories, rankings and lists, believing them all to be part of some scam based on lawyer vanity.  But there are many who view these tools as standard components of a law firm's marketing mix, plus there is a constant influx of new marketers from outside the legal profession who have no pre-formed bias.  My recommendation, lose the chip on your shoulder.

In every business there are competitors.  There are often head-to-head fight-to-the-last-bullet battles between competitors.  And it's important to know the competition.  But my view has always mirrored legendary UCLA basketball coach John Wooden's (possibly apocryphal) view on  game preparation. He never reviewed film of his opponents, and instead focused his team on flawless execution of the basics.  In other words, it doesn't matter what the other guy is doing; all that matters is that we execute well.  In business, deliver what you promise, deliver what the client needs, and let the other guy worry about what you're doing.

In a similar fashion, find your own unique selling proposition.  Help the legal marketers answer the question, Why is your offering additive to my marketing mix?  It's not effective to use "We're better than the other guy because we don't do X or Y, we do Z."  This assumes I have superior knowledge of the other guy, which immediately diminishes your offering. What do you do well? Figure out how to say it.

Interestingly, as I walked the exhibit floor talking to multiple vendors, this theme reappeared several more times.  In one notable case, the president of a small technology company was barely able to articulate what his offering delivered. He hemmed and hawed waiting for the top sales guy to finish up with another prospect, and while he was waiting he described his product thusly:  "We're sort of a Product N light. We don't do all that they do, but then most people don't need all that anyway."  Product N, in case you hadn't guessed, is a leading product in the category.  My advice (well, beyond "Don't stand in the booth if you have nothing helpful to add") once again is to define your unique selling proposition in a few words.  Surely you must offer something that doesn't require me to know all about the competition first!

At one point I worked the exhibit hall during one of the educational sessions.  I suspect I'm not the only conference attendee who occasionally finds nothing of interest at the offered sessions, or perhaps just wants to talk to vendors without the crowd that amasses during breaks. However, the booths were mostly empty. Obviously I wasn't able to poke my head into every educational session, but since many vendors had exhibit-only passes, I surmised that they weren't attending a session and they weren't in the booth.  Where were they?  I can only hope that they were busy in a demo room or were holding some other private client discussions.  If they were at the hotel but not in the booth when prospects were there, that is a travesty.  Nevertheless, I enjoyed the 15-minute chair massage in the information vendor's booth while no one was around.

The opposite is also true.  In some booths the vendor representatives repelled visitors through one of two techniques:  either they stood in a semi-circle in the front of the booth facing in while talking amongst themselves, making an approach impossible; or they stood in a semi-circle facing outward, making an approach daunting as 4 or 5 sets of eyes stared at every passer-by.  Some sat quietly working on their laptops undoubtedly attending to important client matters while we walked by, glanced at the literature, possibly picked up a giveaway pen, and moved on, never making eye contact.  A few, of course, made visitors feel welcome.  I won't go into detail here how to make that happen because it's more amusing to point out what doesn't work -- and besides, helping vendors better reach clients is part of what I do for a living!

Actually, I will reveal the greatest secret to increasing your ROI at a conference, particularly a close-knit community like the legal marketers.  It's this:  Be part of the community.  It's that simple.  How?  Buy more than exhibit-only badges and spend more time with the clients and prospects, learning alongside them in educational sessions, spreading out and mingling with them at breakfast, lunches and cocktail receptions, and attending all the after-hours events.

My former sales teams knew, enjoyed and heartily participated in this credo of non-stop client interaction.  We reached a point where our conference booth was the least important place for us to interact with clients.  We didn't even post a schedule.  We knew that during the conference, from roughly 7 AM to midnight every day, we were with our clients -- our friends! -- participating and contributing alongside them. When the exhibit hall was open, we'd all be around, though we wouldn't congregate in the booth and scare visitors away.  And we most certainly, and enthusiastically, joined our clients after-hours.  And we didn't always pick up the tab either.  Because we were members, not vendors.

At one point at the LMA's "gala" event, amidst all the dancing and frivolity, I stepped outside to get some air and to drop in to a bar next door to the conference hotel to have a drink with an old colleague.  There, arrayed in a group of 15 or so, was one vendor team.  There wasn't a client in sight, for they were all enjoying themselves back at the conference hotel.  Just the vendors enjoying themselves, by themselves. This is poignant example of what to do as a vendor to the community, rather than as a member of the community.  I'll wager a tall, cold drink at the next conference that the ROI report delivered to this vendor's management team was that the conference was good, but not great.

Legal vendors: what sort of sales team preparation do you undertake before attending a major industry conference?  Does the team memorize clear and concise elevator scripts, unique selling propositions and positioning statements?  Do they know their responsibility at the conference is not equal to their assigned booth times?  Does management in attendance know what to say, or when to be quiet?  Do they know when to join clients, and when to take the team offsite for well-deserved R&R?  This isn't rocket science.  Good products, even great products, don't sell themselves.  It takes work and practice to move along the continuum from vendor to the client community to member of the client community.  Are you there yet?  What are you waiting for?

Business Development in the Economic Downturn

At the recent Legal Marketing Association annual conference, I was interviewed by Incisive Media, publisher of countless legal trade journals, organizers of legal conferences and provider of competitive intelligence tools to legal marketers. I was asked how law firms can adapt their legal marketing tactics in light of the economic downturn. You may view the short interview here.

A Note on Reducing Law Firm Associate Compensation

A recent op-ed in the New York Times stated the obvious point, at least for readers of this blog, that some of the mechanics of the legal profession are in dire need of updating.  The author specifically identifies associate compensation as a leading target for significant revision. The author is right, of course, on several points.  Associates at large firms enjoy generous starting compensation packages that by comparison to entry level legal jobs in the public sector, or in small firms, or frankly to entry level jobs anywhere, appear disproportionately large.  Implicit in the piece is the burden these high fixed costs present to law firms who have experienced a fairly sudden and substantial decrease in demand for legal services.

Not expressed in the article, but known to observers of the legal profession, are two additional challenges:  newly graduated lawyers are by and large not prepared to practice law; and they don't stay long enough to generate sufficient profits to pay for their own learning curve.  So large law firms are paying substantial wages to green recruits, trained to think and act like a lawyer, but not yet ready to lawyer, and then incurring additional expenses for on-the-job training. Some of this learning curve has been subsidized by clients, many of whom are finally asserting that their high legal fees should buy senior lawyers with deep experience rather than a host of trainees inefficiently learning while doing.

The author suggests a drop in associate compensation is needed, from $160,000 in major cities to perhaps $100,000. This suggestion will no doubt rally the snarky set who frequent the legal tabloids:

“YOU feel sorry for THEM? ...the spoiled Ivy grads - who lost their silver spoon overpaid jobs that they never deserved in the first place, because they only billed 1600 hours and half of that was padded time anyway . . . wah wah wah!”

The simple fact of the matter is, when demand for labor declines then labor rates decline.  It's no more nor less justified or "right" than in recent years when demand for labor was high and labor rates for the most desirable new lawyers increased.

But is it enough?  I don't believe reducing associate compensation, or laying off staff members, is even close to approaching the solution.  And I'm not even referring to the crying need to reduce partner compensation, or even to cull the partner rolls -- even though doing so would be in keeping with the declining demand-declining labor rate equilibirum impacting associates.  No, to "solve" the challenges facing the legal profession requires a re-think, as the New York Times writer suggests.  But rather than limit the conversation to compensation and overhead and billing rates, it's time to take a good hard look at how law is practiced.

In any industry, the inexorable encroachment of technology or innovation provide new entrants with advantages that can disintermediate or displace incumbents.  Refer to any grammar school text book for a recap of how Eli Whitney's cotton gin transformed the postwar Southern agricultural industry.  Undoubtedly there were a few cotton pickers whose jobs and wages were disrupted.  Henry Ford's assembly line turned the automobile from a quaint toy for the wealthy into a necessary tool for modern life, shrinking the continent and making suburban life practical... and wreaking havoc on the proverbial buggy whip manufacturer.  The story continues, from the invention of the computer to the Internet to eBay to Amazon's "one-click" business method to global positioning satellites to asset securitization and so on.  In the march of human progress when we find a better, cheaper, more effective alternative, we shed a tear for a nostalgic moment and then we move on.

It's time that the typical law firm of today take a good hard l0ok at modern business practices such as governance structures which improve rather than impair organizational effectiveness; supply chain management techniques to eliminate redundant and unprofitable workflow steps; the application of technology to automate repetitive tasks; the use of alternative fee structures to promote efficiency and reward successful outcomes rather than time.

Some of these topics have been promoted before. Very few law firm leaders haven't heard the drumbeat of alternative fees, for example.  But what has been lacking is specific, actionable, quantifiable information to demonstrate how these business practices will improve the practice of law for both the suppliers -- the law firms -- and the consumers -- the clients.

No more, I say.  Let's move from theory to practice.  We will address these topics in more detail in this blog in the coming weeks.  Stay tuned.

For another perspective, read Ron Friedmann's reaction to the NYT article here.

Law Firm Leaders – Save Money Now By Cutting Marketing!

One truism in any economic downturn is that marketers will unfurl the union banner which reads “Good companies grow share by expanding marketing while others cut.” Another truism is that business leaders, when faced with an economic slowdown, will often apply the cost-cutting scythe to all departments in the interest of fairness, suggesting that every department should bear its proportionate share of the burden. You may note that these approaches are mutually exclusive. Both can’t possibly be right. However, both approaches, if interpreted or executed incorrectly, can be dead wrong.

Of course there is truth to the historical notion that when some companies hunker down and cut costs, others spend more to fill the ensuing vacuum, raising visibility and name recognition. But this doesn’t mean that whatever you spent last year on Marketing should be the same or more this year.

The more critical analysis is how you invest in Marketing, not how much you spend.

I’m writing this as I travel to the Legal Marketing Association’s annual conference where for the next several days I will hear (and deliver) commentary to legal marketers, and any number of fantastic ideas will be proffered. The ever-present challenge in the legal marketing arena is not a paucity of good ideas; it’s an inability to execute these ideas.

I engaged in an interesting dialog with a large law firm partner, who was typically harried, intense and exceedingly bright. He described his marketing needs as simple: “We need someone to track all of our completed deals so they can be searched by client, region and type. Then the marketer needs to be able to quickly pull this info and plug it into an RFP template to send to the client.” My first reaction was that he didn’t need a marketer at all; all he needed was an Excel spreadsheet that his secretary could maintain. After a bit more analysis, I learned that the partner and others in his practice had a dismal win rate on RFPs, in part because they didn’t understand that strong relationships with clients can often win work without an RFP.

A veteran partner at another firm, a bit long in the tooth and primarily a service partner, lamented that he was not comfortable “working a room” in the same manner as his successful rainmaking partners did with ease, so he preferred to sponsor client events such as the cocktail reception at an industry annual convention. He deserves credit for spending time in the client’s backyard. But when he described the benefits derived from his sponsorship (essentially the firm logo on the cocktail napkins and a polite podium mention from the association president) it was clear there was very little value obtained for the significant investment.

I engaged in a dialog with a bright, energetic young partner in a mid-size firm who was eager to learn rainmaking skills. “We’ve arranged an introductory meeting with a manufacturer across town, but we need to know how many partners to invite in order to fully present our capabilities.” The intended approach was to present several of the firm’s practices to a polite audience of in-house counsel, in the hopes that this would win work.

Some lawyers reading the above anecdotes will recognize these recurring challenges and wonder why I find fault.  In fact, some marketers who have learned their craft in traditional law firm settings will ask the same. But savvy marketers will attack:

“In the first example, the partner should focus on identifying, establishing and growing key client relationships, and rely on RFPs only as a last resort. A well-oiled machine that efficiently plays your 78-rpm phonograph records in an MP3 world is still a waste of time.”

Others will declare:

“Eliminate all sponsorships that don’t provide a public speaking opportunity, and if you get stage fright then bring a colleague who doesn’t.”

Finally, some will advise:

“When you first meet with a potential client, your objective is to learn their business and not to promote yourself and your capabilities. How could you possibly know what challenges they face if you don’t ask?”

Marketing carries so many different meanings. For lawyers who have enjoyed the luxury of a generation of near unlimited demand for legal services, Marketing is nearly synonymous with high-end administrative support. It’s event planning, brochure writing and writing elegant prose about how wonderful we are. For the rest of the business community, Marketing is about identifying optimal target markets, taking steps to increase visibility and demonstrating expertise in these markets, understanding client concerns and then developing and offering solutions to address these concerns.

When the expense reduction committee turns its attention to Marketing department, I suggest it’s less impactful in the long run to view Marketing as a collection of fixed and variable expenses and people comprising a cost center. Focus instead on what the firm is doing to articulate its strategy, pursue clients and prospects, enter new markets, replicate financially successful engagements, improve inefficient operations and thus elevate the service posture, and protect and defend its key client relationships. If the red pen you wield in the budget discussion doesn’t directly improve any of these metrics, then what’s the point? You can continue to reduce expenses across the board without regard to what generates revenue, but this won’t buy enough time until client demand returns to previous levels. That train has left the station. Don't cut "marketing expenses." Rather, cut the wasteful expenditures and activities which have little impact in generating new revenue.

What’s needed right now, more than ever, isn’t an expense reduction committee. It’s a revenue generation committee. It should be the first firm-wide committee. All hands on deck. And for those who are too busy or disinterested to participate, you can still put your red pen to use by circling your name as an ineffective investment.