There’s plenty to chew on in the LexisNexis InterAction 2018 Law Firm Marketing and Business Development Survey Report released today. It’s a fascinating look at how firms and marketers are settling into a “new normal,” where they plan to direct their marketing and business development dollars, and whom they consider the true competition.
But the survey also reveals a dangerous divide. Firm leadership (think COOs and managing partners) is placing enormous expectations on CMOS and CBDOs, and yet these marketing and business development professionals report that partner engagement and follow-through is a greater problem than ever.
It calls to mind the debate over the term “non-lawyer,” and seems to reinforce that the “us v. them” conundrum is about much more than semantics.
First, the Survey Highlights
LexisNexis InterAction conducted the survey in partnership with Catapult Growth Partners to assess “the current state of legal marketing and business development, how marketing and business development teams are changing, and which metrics are used to measure the outcomes they achieve.” Past surveys were conducted in 2015 and 2017. Here are highlights that stood out for me:
Fewer respondents than in previous surveys agreed with the statement “the strategies and activities law firms require to win new business today have changed considerably in the last two years.” In 2015, 85 percent of respondents agreed or strongly agreed, compared to just 32 percent this year, indicating that firms are adjusting to the new competitive landscape.
Competition is expected to be stiffer in 2018 compared to 2017, and firms report near equal pressure from peer firms (49 percent), larger firms (46 percent) and internal legal departments (44 percent). Read another way, clients pose just as great a threat as law-firm competitors. That mindset is bound to have relationship repercussions.
There is widespread dissatisfaction with which metrics to track to determine success, coupled with failure to move beyond basic measures of success. According to the survey, few firms are using the most sophisticated methods.
When it comes to spending, budgets remain flat but the allocation is changing. Less money is being spent on so-called traditional marketing. Firms report they plan to increase spending on market and client research by 20 percent — a huge indicator of how much they are feeling the competition, and the instinct that data is the answer. Firms also report they will increase spending between two to five percent on thought leadership, content development, PR and digital marketing.
Lastly, collaboration within the firm to serve existing clients was noted as the most difficult challenge firms faced. Firms are looking toward technology to mend that, and they are increasingly making it the marketing and business development functions’ responsibility to figure it out.
Relationship Issues Revealed: CMO Churn
The most intriguing, and the most troubling, findings of the survey speak to the relationship between firm COOs and managing partners and the marketing and BD professionals. The stats are chilling, but it’s the comments that drive the message home.
Now that the dust has settled, law firms are looking to their marketing and BD units to drive innovation. Fair enough. Yet a whopping 54 percent of firms rated their marketing sophistication as average or below average, and that jumps to 61 percent when asked to rate their business development capabilities. When asked whether their marketing department has adapted to the changing market, only 40 percent of COOs and managing partners said “somewhat.”
“They should be driving changes in how our partners operate, how they approach current and prospective clients, and the result should be increases in revenue and higher realization/rates,” reported one survey respondent.
Another law firm COO said, “Frankly, I think the CMO’s job is the hardest in the firm. All success is attributed to the lawyer and all failures are the fault of the CMO.”
Perhaps this is why: Marketers noted that their No. 1 challenge in winning new business is lawyer participation, cited by 42 percent of respondents, compared to 38 percent in 2015. Survey respondents complained of lack of lawyer follow-up, with 15 percent citing it as a challenge, compared to 9 percent three years ago.
Yikes. This is a set-up, and it explains at least some of the CMO churn at firms.
This is an industry in a robust economy that has experienced a significant shift but has now stabilized. Yet it experiences relationship issues that would tax the most skilled therapist.
Bottom line: this is an industry in a robust economy that has experienced a significant shift but has now stabilized. Yet it experiences relationship issues that would tax the most skilled therapist. Law firms see clients as competition. Within firms, finger pointing and what seem to be unrealistic expectations are rampant.
LexisNexis is a technology and data company that sells CRM products, so while I don’t question the data, it’s not surprising that the survey found that firms are looking to tech solutions to bridge the collaboration gap and try to get everyone on the same page. Tech, when successfully adopted, can be a huge unifier. But some of the data points to deeper issues that tech is likely never going to reach.
The key to resolve the conflict is not data, I suspect, but a willingness to sit down in a safe space and ask, “Do you really feel this way?” and then have the guts to have the conversation of this survey face-to-face.
About the Survey
Data for the 2018 Law Firm Marketing and Business Development Survey was derived from 91 marketing and business development professionals across the U.S. and in Europe, including 40 AmLaw 100 CMOs and CBDOs. Nearly half of the respondents are LexisNexis customers from large firms averaging 416 attorneys, with $260 million in annual revenue. Most respondents have worked for their firm for eight years and in the legal profession for 15 years.
For more information, you can download the full report here.