June 21, 2023

2023 Study: Exposing the Costly Mistakes of 100 Regional NSW Law Firms in Converting Referrals

Ask any lawyer, and they’ll tell you that referrals are the lifeblood of their business. In most law firms, referrals are the primary source of new business.
So important are referrals that over 58% of all law firms do little or no other marketing to generate clients.
Twenty years ago, a neighbour or a friend would recommend a lawyer and the law firm where they worked. You’d look up the phone number, call and make an appointment. Over 85% of first meetings were converted into new clients.
Good consistent lawyering was rewarded. Referrals were the golden ticket that virtually ensured growth.
Advancements in technology have changed consumer expectations.
The referral process has changed for the better, and this one act has dramatic consequences for the future of your law firm.
The referral process is different. You must understand the changes impacting how people use a referral to select a lawyer to help them solve their legal questions.
The beginning of the process remains the same. Word of mouth from a friend, workmate or family member will remain a constant.
But what happens next severely impacts each lawyer’s ability to convert referrals into clients.
Today when someone recommends anything from a new restaurant to a place to stay to the services of a professional or tradesperson, we rush to confirm their opinion. First up, we google the website and, in doing so, expect a confirmation of their recommendation.

If you wanted a hotel with an ocean view and a friend recommended one with a view of the car park, you’d soon look elsewhere. You’d question whether the recommendation was well-founded.

We use our rational and emotional brains to filter the information on the website. We want to verify their opinion as accurate. We need a lawyer, and we expect the referral to save the time and frustration of searching and finding the right lawyer for us.
No longer do we accept other people’s views at face value. 
Verification of the credibility and reliability of any referral has become an automatic everyday activity. The last thing we want to do is make a wrong decision we’ll later regret.
We seek to understand the context of the recommendation. We start by reviewing the law firm’s website. People’s expectations vary, but most require specific information to support the law firm’s suitability.
The left brain wants the information on the website to be relevant to our situation. If you want to write a will, you’d expect a service page or blog explaining how. If not, we’d wonder why they don’t discuss it on their website and if they have the relevant experience.
The right brain seeks an emotional connection. What that means for you and me might vary considerably, and it’s hard to quantify, but our intuition recognises it when it sees it.
Confirming recommendations builds trust. Ticking a range of boxes gives us the confidence to pick up the phone and make an appointment.
Potential clients increasingly decide if you’re right based on their interaction with your website. They are unlikely to connect with you if your website doesn’t support the referral.
 If you took the time to measure the number of people who visit your website and don’t proceed to the next step, you’d understand how much new business you are missing out on.
In other words, how quickly they leave your website and begin a search for your competitors. Another more engaging law firm website answers their questions and feels like the right fit for them. You’re kidding yourself if you expect them to return to your website or call you.
The importance of website engagement is more vital now than ever before. You can no longer rely on a billboard website that talks about you, your experience and your location. More than that is needed to win new business even after a positive referral.
Last month we conducted a research study of 100 regional law firms in NSW.
Firms were selected at random across 35 towns and cities.
We focused on five key areas, scoring each firm out of 5.
Our research suggests that one in two potential clients will likely leave your website for another local firm.
As a result, on average, most firms lose $82,500 or more in annual revenue from lost referral opportunities. Check-in at home, and you’ll quickly be given a list of how that money can be spent. Who are you disappointing as a result?
Let´s talk
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