Episode 53

Published on:

25th Apr 2024

The Secret to Boost Law Firm Profits with Data-Driven Marketing | YPM Podcast

In this episode of Your Practice Mastered Podcast, join Elliot from Empirical360 as we dive into the often-overlooked areas of lead management and marketing efficiencies that can skyrocket law firm profitability. Discover why "more leads" might not be the answer and how focusing on conversion rates and profitable marketing strategies can transform your practice. 

Elliot shares insights on leveraging data and the importance of a non-attorney sales force in closing more cases. Tune in to unearth the secrets to maximizing your firm's potential through strategic marketing and sales approaches.

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Let’s Chat About Growing Your Law Firm. 



The Myth of Needing More Leads: A Deep Dive


Elliot: most common response is, I need more leads. But if we truly tracked every lead in a CRM, We would see that you actually have more than enough leads. In fact, you might have too many leads, which is why not closing at the rates you need to close at. And so that's a conversation that doesn't happen enough, a lot in a lot of sales organizations.

It's always, we need more leads, and if we can be efficient with that, I've told clients you could spend less and make more.

Welcome to Your Practice Mastered Podcast


MPS: Hey, law firm owners. Welcome to the Your Practice Mastered podcast. We're your hosts, I'm MPS.

Richard James: And I'm Richard James. MPS, I think you got an important disclaimer you need to cover before we go any further.

MPS: Yeah, look, if you guys like this content, make sure you hit that subscribe or follow button depending on wherever you're listening or watching. And we promise to give you some valuable insight just like today. So Rich, why don't you let us in on some insight with our guest for today?

Introducing Elliot: The Journey of Empirical 360


rother founded this company. [:

Elliot: Yeah. Yeah. We have a t-shirt that says EBITDA, which is just a fancy word for profit. It's all about what are you taking home?

Richard James: I love it. I'm disappointed, you didn't wear the t-shirt. I'll be straight with you.

Elliot: I honestly, I looked at it this morning and I'm like, should I wear it? You know what? I'm going to look professional today. I'll wear it on another one.

Richard James: Fair enough. We'll have you back, you can wear it again. So, Michael, why don't you lead us off and let's go in the direction you want to go?

this. But I want to give the [:

Elliot: Not something everybody knows, business related or not business related?

MPS: Whatever you'd like.

Jiu-Jitsu and Business: Drawing Parallels


Elliot: I'm a black belt in Jiu-Jitsu and so that's always fun. I'm very achy, so if you see me cracking my neck on this call, that's why. So that's an unknown.

Richard James: That's cool, all right. So you would have us tap out. I get it, I understand. I tried Jui-Jitsu once. It is a whole different style of martial arts. And,

Elliot: Oh yeah.


Richard James: I met

Michael, I think you tried, if I'm not mistaken, you and Justin, your brother went to it. Wasn't it that football player in Phoenix, was it Westbrook? Was that his name?

MPS: Yeah, Westbrook.

Richard James: And he was a Jui-Jitsu Master and you guys took his lessons. I don't know. What did you think about it?

MPS: It's tough. I think it's super valuable. It's fun to learn, but it's tough. Yeah, it is probably one of the toughest out of all of them, in my opinion.

like business, you get beat [:

Richard James: So Yeah, I love that because it is a great parallel for that person.

The Path to Profitability for Law Firms


Richard James: That law firm owner that's listening right now, that's maybe either, they're sitting there doing 500 or a million dollars and they're not profitable and they're like, we got their ears to perk up because we talked about profitability, or maybe they're just trying to figure out how to get started and they're at the end of a 75 hour string on the week. And they're, just picked up this video by seeing an ad on Facebook or something. They jumped to the podcast and here they're giving it a listen. And message to them is, the good news is, if you keep up with the grind, there is a payoff at the end, right?

It doesn't matter your size [:

Elliot: Exactly, a little. You get humbled in there just like you're doing business and you walk in and when the hundred pound girl beats you and you're a 200 pound guy, you're like, how is this possible? And they're outmaneuvering with technique, just like a small law firm can outmaneuver a big law firm with the right technique.

So, there, there's so many cool parallels. And if unless you're

like in the Jiu-Jitsu, you can't talk about it too much, you're like, you're weird. But yeah absolutely, the leverage is a huge component, the technique and leverage.

Richard James: I love it. That's a great example, because we're all about leverage around here. MPS?

MPS: Oh, we're all about leverage. Finding those levers and leveraging those levers. And then using that to make some magic happen. Elliot, I'm curious, talk us through the journey a little bit.

Empirical 360's Origin and Focus on Law Firms


MPS: How'd you get started with Empirical 360 and how law firm owners?

Elliot: Yeah.


we got to spending around A [:

And that was actually our first run in with profitability. That company sold products, that we were like, guys, the rates here don't make a lot of sense, but we were young so they didn't take us seriously, which was fine. Time told us that you got to really pay attention to those profitability things or don't chase the quick cash if it doesn't make sense long term.

And so, that spun off and I was doing insurance marketing, because we were working with call centers which led into medical. We had some lawyer clients in the beginning that were always good clients, but we didn't pay attention to them. Should this be our niche?

e were like, that. These are [:

But that just led us to going all in on attorneys and we never looked back, honestly. COVID ramped that up a lot. We had a lot of success with family law firms and litigation firms and bankruptcy firms during that period. it was just, You guys know, it exploded during COVID for a lot of firms. Some firms, unfortunately it didn't, but a lot of firms that did, and we were lucky enough to ride that wave. So one thing led to another.

Practice Area Dynamics and COVID-19's Impact


Richard James: Yeah, practice area specific is a very important conversation. We have all of our clients raise their hand and say, my business is not different than yours. Because fundamentally the moving parts are the same, but there are some macroeconomics that did affect practice areas. And family law went up and bankruptcy because the government said, you don't have to pay your bills, you don't have to pay your debts, you don't have to pay your student loans. People got a lot of reprieve and Oh, by the way, they mailed them checks. So people got free money. So we got free money, businesses got PPP Money and people didn't have to pay their bills. So bankruptcy really went down for a very long period of time.

tive though, right? Like the [:

Richard James: it was, is that the good ones. Who worked with companies like yours, who could figure out how to generate them the lead didn't pay as much to the cost per lead as they did to the cost per client acquisition. And then they learned how to pull the levers, as Michael said, figuring out how to maximize their set rate, how to maximize the show rate, how to maximize their hire rate, how to maximize the client value. To your point, let's not try to sell $995 bankruptcies, right? Because that's not going to get us to where we need to be. We need to be selling a chapter seven at the right number.

t makes sense and allows for [:

And when you can get all that to match, you open up another can of worms that is a problem, which is now you got to get the work done, which you know, that's another issue. But as long as we're starting off profitably, we can actually make some moves in the right direction. And so I appreciate that. And I love that you fell in love with working with attorneys because, I did too.

y did if I was honest back in:

ally started helping them on [:

Profitability Mistakes Law Firms Make


MPS: I want to focus a little bit on this conversation of profitability from a marketing agency's perspective. So Elliot, my question is, what do you feel is the number one mistake law firms make when it comes to their profitability from a marketing perspective? Where do they seem to go wrong?

Elliot: I could think of a lot of things there. I'll start with the easiest one and that is, we need more leads. When we have inefficiencies in the acquisition cycle. And mainly around that sales tracking component. I can't tell you how many firms I've come into where the data was so messy, and I don't mean that to be insulting, but so much waste is happening.

n enough leads. In fact, you [:

It's always, we need more leads. And if we can be efficient with that, I've told clients, you could spend less and make more. It's truly so fun to manipulate those numbers on the sales side of things. That's a big one. The other one is, we have to do all the things when it comes to marketing.

And it's very easy to hit seven or even multiple seven figures with a single source of leads. And what I like about that is predictability. I know that when this lead comes in, it's going to set at this rate, it's going to show at this rate, it's going to close at this rate. I don't need that. TikTok yet. I don't need Facebook yet. I don't need SEO in some cases yet. right? If you don't have the time to wait for that slow burn, maybe it's not the right time for that smaller law firm. And I can't tell you how many people I've told that to, and they look at me like I'm crazy. So those are two big areas where we put out a lot of cash on marketing.

When that cash could be [:

I think a lot of waste happens there where we try and keep up with the Joneses or the people on social media of I got to have this awesome office, and I got to have a really cool custom logo that costs me 10,000 bucks. And we did that. And early on, when Eric and I were making a million dollars, we were spending a million dollars and then COVID hit.

And we're like, We have no money. What do we do now?" so we still had a lot of good revenue, but we had to make a really hard choices. So I don't like overextending myself too much. It's a risk tolerance. It's a personal thing, but those are my three buckets. I would say for attorney specifically, the waste around lots of leads, they have tons of leads, such a high demand practice. Any one of the practice areas, there's so much abundance out there. But it's usually internal that they can get a lot of wins for profitability.

Richard James: Wow, [:

So we can unpack all three of those together, but do you feel like that's an accurate summary? Did I get that right MPS?

Elliot: I think you said it better than I did. Unfortunately, Yeah I think you said it better than me. Like I said,

Richard James: No, I don't know about better, just different. So it's just a different view. MPS, do you think I hit that summary correct?

touch on that first one. So, [:

Optimizing for Easy vs. Strategic Growth


MPS: If we're being honest, if a firm is working with a marketing agency, I think the reason that becomes the go-to is because that's easy. It's easy to do. It's easy to go to your marketing agency and say, Hey, we need more leads.

And if you've got the funds to do it, it's real easy to just allocate the money there. It's not as easy in some cases to fix the conversion metrics. So we look for the easy path and I think that's what a lot of law firms do. Good, bad or indifferent. It's what a lot of them do. And so they think the easy path to growth is get more leads, we're good to go. Really? I'd say that's actually pretty harmful. Rich, what do you think about that? Would you agree with that?

ness training, and those who [:

And almost all of them started by being the technician, the practitioner. And so all the work that comes through falls on them. And then they have to deal with the opposing counsel, the judge, or the trustee or whatever court system that they're in. They got to deal with the clients and all the communication and demands that clients have while they're panicking through these difficult situations.

So it's to save a drowning person. right? They're fighting you the whole way. And then on top of all of that, they got to manage whatever team members they have. They've got to manage the vendors that they have. They've got to manage the lead flow. They've got to figure out how to manage the phones.

And some of them just get so inundated with the first couple that they never get to the ladder. And then they wonder why they are where they are. And it's just because they're drowning in their own busyness, right? And so, optimizing for easy is really a sense of survival because they can't imagine another rock.

Elliot, I'd [:

Elliot: Yeah, absolutely. Hey, go revamp your sales process, like what? Or to go get your site redone. It's just too much. Especially if they have everything else that's going on.

been fixing all of the wrong [:

And what really has to happen is just that one more carburetor adjustment that's going to start to set them free. Let me give this a mathematical calculation to keep it really simple. I know a lot of attorneys don't like math. This is just going to be arithmetic folks. No calculus here. So generally speaking, when you have a firm that's converting leads into clients, if you just looked at it macroly and you said, okay, I've get X number of qualified leads and I get Y number of clients, if I just divide the number of clients by the number of leads, I get a percentage. Many firms who are just in the business of buying more leads are converting less than 10% of those leads into paying clients. Would you agree with that, Elliot?

Elliot: Yep.

Richard James: Now, I don't know if you have a healthy number. What in your mind is a healthy number of percentage of leads you'd like to see them convert into quantity, percentage of qualified leads you'd like to see them convert into clients?

Elliot: Yeah. So for qualified, I have a better answer for just overall lead flow, because that's what I'll visualize

Richard James: Fair [:

Elliot: a lot for clients. But if it can be in most practice areas, just 10%, which I believe is a easy to hit number. Think about just 10 people walking into your office and saying, Hey, I want your help. Can you close one of those?

That will lead to very high amounts of profitability. You're talking typically 10 X return on your media spend. If you throw in organic sources in there, it can be significantly higher. And that's on lowercase values typically reported. Cause some of these things can be worth quite a bit of money. So, 10% is the bare minimum to insane success. You'll have other problems. Like you said, if you're doing that, you'll have other problems.

Richard James: Yeah. And so, I don't disagree with you. I think, it does depend on case value and practice area and things of that nature.

Unlocking Exceptional Lead Conversion Rates


Richard James: But, let's say 10% is the bare minimum, I will tell you, Michael, what is the highest that you've seen as percentage of overall lead flow conversion when you get it?

MPS: I've seen upwards of 30 to 40% in some cases,

getting it right. And as you [:

Elliot: Yeah, I've seen a firm do that. One from in particular and got to eight figures insanely fast. It's truly and it always sounds pie in the sky, but it's a money printer if you can close it 20 and 30%. I've seen a handful of firms do it. And they're just exceptional.

Richard James: Yes. That's our goal. Michael's goal has always been, can we get you in the 20s? right?

Elliot: Yeah, it's amazing.

k to the firm that I built in:

% of our sales came for [:

The Power of Follow-Up in Sales Conversion


Richard James: So I was to give a firm one fix, yeah, there's lots of things to fix in the sales funnel. I would think I would say to them is how about we just fix your followup. Just fix your fault. Follow up with the leads that aren't converting right now. Let's put some sort of system in place. We know there are lots of them available to us. We have mail, direct mail, email, text messaging, phone calls, right? We have multiple ways to fix our follow up. Facebook or social media messaging and things of that nature. But let's pick one and get really good at it and just start to fix the follow up.

Elliot, if your firms that you worked with just fix their follow up, if nothing else, fix their follow up, do you think that they would see an improving improvement in their overall lead conversion?

u could just truly double by [:

And people always think it's exaggerated. Cause we see so much click bait, like, double your firm, triple, quadruple your firm. And so we get sensitive or numb to that, but literally just following up with leads could double your business. And I've seen it happen time and time again.

Leveraging Non-Attorney Salespeople for Growth


cases a month in:

We don't get credit for that. He gets credit for that. But Michael, you would point to something else that worked in his firm, that you think was the main key objective. What would that have been for you?

an okay set rate, he had an [:

And that non-attorney sales person is now closing in the upwards of 80% and above for him. And since that's happened, the only thing they're capped by now is the ability to get people in quicker because appointments are booking up. So they're looking to bring in another non-attorney salesperson. right? So capacity, so that's their only big cap at the moment. And so, that was the pivotal point for them. That's what allowed them going back to levers. That's the lever that they were able to pull literally skyrocket growth. You talk about nine bagger. Yeah, it was a nine bagger new clients.

e values while doing it. And [:

Richard James: Yeah.

Maximizing Profitability Through Strategic Changes


Richard James: So Elliot, if you get somebody go from 30% close rate, maybe for, I don't know what it was to a 80% close rate and they go from a case value where they are now and double their case value, what does that do to profitability?

Elliot: Oh my gosh. If you think about it, so this is the fun part with that story, right? Let's just say he had a cost of acquisition of a thousand dollars. Everything on top of that, let's say you're spending $10,000, let's say you're spending $1,000 a month on marketing cause you keep it just simple, everything that you get by just optimizing that cost of acquisition stays the same. And now for each client, it gets way lower. So maybe you had a thousand dollar cost of acquisition. You got one client, but now you're getting nine. Now your cost of acquisition is a hundred bucks. The rest of that goes in your pocket, right? And then you increase your price and then that goes in your pocket. So like the leverage, those are two just small levers. right? Non-attorney salesperson increased price. Potentially, I don't know the math five X in his pocket. Who knows?

to them. Okay, you fixed all [:

Cause now you've got a system that could manage, the machine that could manage converting those leads. And you guys will have all the confidence in saying, yeah, you're right. You do need more leads. right? we, You want to take over the world, let's go. That's the power of this. And by the way, Michael, which is what was interesting is, I said James Hausen, he deserves credit.

But it just hit me as you were saying it like, Katanga, right? she's another EAY finalist. Number one thing that she spouted off that can made her difference in conversion was non-attorney salesperson. Will and Kelly Grafton, another finalist, they were your very first client to hire a non-attorney salesperson.

ney salespeople as well took [:

So what's the common thread in this? Non-attorney salespeople, right? I don't mean to be on my high-horse about this, but every firm we see that uses that willing to use a non-attorney salesperson, they close at such better rates than firms that use attorney salespeople. Is that right, Michael?

MPS: Kick their tails really not in comparison. Look, I always say, can you make attorney salespeople work? Yeah, you can make it work. Are you going to make it work as good as non-attorney salespeople? Absolutely not. I've done it too many times. And so, non-attorney salespeople just significantly outperform.

throw gasoline on the fire, [:

Now you can go to someone like Elliot and start to amplify your marketing spend because now it makes sense to do.

Would you agree with that, Elliot?

Elliot: Yeah, absolutely. Learn on the lead flow you have, or there are easy ways to get leads that are qualified where don't have to put out tons of money and dial your metrics in, it's everything becomes easier. You solve acquisition at that point, your problems are hiring more attorneys or hiring other people, right?

Like That becomes the problem, which those are good problems to have. But it's amazing to see. And if you just think about what you guys said, right? attorney didn't go to law school to sell. don't like it unless they do, in which case they're like a unicorn.

Usually the founders can do it because it's their business and they have to, but your other attorneys, they don't want to sell salespeople. Let them go, do your thing. It makes all the sense in the world. And the firms that scale that do it at scale, all of them have non-attorney salespeople. Very rarely are you having attorneys coming in to bail them out at scale. It's always the non-attorney salespeople.

MPS: So Elliot, look, you're a high performer.

Daily Habits for Success and Growth


of your success habits that [:

Elliot: We do Jiu-Jitsu in the mornings or we work very early. right? That nice quiet time of work. So one of those two things happens, make sure to work a lot. Honestly, we work cause we love it. It's not one of those things where it's oh my gosh, I'm working so much, but it's fun to solve these problems. And we just love driving that growth, whether it's our business or a client's business, you get to hear me like I'm a nerd, right? I love the wheels turning of, man, I changed your set rate and bam, you just doubled your business. So that's what we do all day. But as far as like outside of work, it's Jiu-Jitsu, it's family.

And then, trying to get as much sleep as I can, which is tough these days. I got a two year old, but the life right there. Those are the success habits, really focused on driving our clients results. That's the big thing.

Richard James: I have a four month old puppy. And the four month old puppy actually sleeping through the night. And I'm like, I don't know what to do with myself cause I'm not getting woke up at two o'clock in the morning anymore.

Elliot: Oh, yeah. Puppies can be rough, especially because when they wake up, they're doing damage somewhere.

Richard James: That's right, exactly. Okay, so back to your wheelhouse real quick.

Mastering Marketing to Generate Leads


e talked about conversion. I [:

Where do you start them? again? Cause you said, let's not lose focus. Let's not try to 5/5 things. Let's master one thing. What do you want them to master first marketing to start generating leads or to increase generating leads?

Elliot: That's a great question. I love this because, I'll tell you what a lot of agencies do. They will sell you everything all at once. And the reason for that is, just so you understand the agency model is you're stickier, you'll stick longer. If I do your website and I do everything for you. And then you don't leave and I make more money. And then I'll sell you SEO cause that's a slower burn and you got to stay for 12 months. And the problem that costs a lot of money. And so, you spend all of your budget on the service and not the results. And what I tell people is, you want to tear into your marketing.

. right? Why I shouldn't say [:

And so, you don't need to pay an agency for local service ads. There are like three nuances when you set that thing up. It takes 10 minutes. Dispute leads, check off the right practice areas, answer your phone calls, right? Otherwise Google dings you, you need reviews, that's it. Very simple, 10 minutes to get leads from Google and the way that Google, the reason they did this just for some background is, agencies would set up Google Ads or Google people would set up Google Ads and you would just get put through the ringer. They would never work. Because it's, there's so many nuances in Google Ads, right? I've spent 60 million on Google Ads.

results so that when you're [:

So I tell lawyers is go set that up. When you close those leads, you can close any lead that comes from Google, SEO, pay-per-click, and then you can scale to multiple seven figures on just that alone. So, what I would tell people is, if you're looking to get leads, that's the easiest way to do it.

Hopefully that answered your question. What's the quickest way or what's the easiest way. But that's one of the things is, get leads, you don't need too many of them, get your feet wet, dip your toes in the Google waters. And then when you're having success, next level.

Richard James: Yeah, no, I think that was perfect. I call it the puppy training method. I've got a puppy now, so I've, I'm using a lot of puppy analogies. But the puppy training method is they basically, you train your puppy on the five basic skills and you don't go to the harder skill until you master the easier skills.

ess, you got to go back down [:

Not comparing attorneys or law firm owners to puppies, but we are basically saying we have to master the basics, master the fundamentals, get that one skill set done, and that the first place for you to start was with LSAs because they're simple to set up. They're going to start generating you leads that work, and you can learn to convert those at a very low investment rate before you move on to the next issue.

Michael, anything you want to add to that?

MPS: No, I think that was well said. And I think that's probably to your point, Elliot, the low hanging fruit, the easy place to start. And I also agree with what you said about, if you can convert people that don't know and trust you yet, and you put the proper systems in place to convert those people, it's game over. At that point really just comes down to how quickly you want to scale. Because then, you've got the recipe. You've got the recipe down and now you can move. My guess, just what's got you excited? What's got you fired up today? Could be personal, could be business?

Elliot: So I [:

The Impact of Data-Driven Decisions on Firm Growth


Elliot: I would say that just diving into the more data driven approach. So we've always been very data driven, tracking our clients numbers and just knowing that if you just do these simple things, you'll have success. It doesn't have to be complicated. And so, back to your point, Rich, about these people who are like, what do I do? Like, Why is this so hard? There really is a light at the end of the tunnel was, if you just track your numbers and you systematically attack them, which is what we like to do with our clients, it becomes very simple.

e, your guys are making this [:

But if we just go listen to some of these calls, what can happen? And so we see what's happening. Balls are being dropped, some of the answering services that they're using are not doing what they should be doing. And I'm like, this is a super easy fix. We get this to 50%, 60% cause they do paid things.

You just doubled and you already five X, what does that look like? So that gets me excited. That gets me pumped up. When I see those tiny changes that can make such a big impact, not only for the firm owner, the employees, that everybody touches, when you go see a firm in person, cause we're all virtual and 50 people in the room that work at the firm, you're like, wow, this is pretty cool. Like That change just kept on those people. Some businesses can go out. It's stressful for some of these people. So, that's what gets me excited honestly, I love the numbers and I just love diving into them.

that's what you really need.[:

And rather you look at their set rate and you go, Hey, you're at 25%. Could you imagine if we can bump that to 50? What if they went to 70? What if they went to 80, right?

Elliot: What if they hit KPI, right? If you get to just the service level, 70, 80, forget it. It's so fun to watch, but yeah it's, a blast to see.

Richard James: This has been so much fun. Somebody wanted to learn more about Empirical 360, where would they go to do that? What's the best way for them to learn about you?

Elliot: Yeah. You could hit our site, you could go to YouTube, lots of videos talking about similar stuff like this. I think those are the two best places. So that would be where I start for sure.

Richard James: Awesome, Michael?

MPS: Fantastic. Elliot, you guys are part of the rare few in the marketing agency field. So I appreciate you sharing your insight. Yes, absolutely. And to the law firm owners listening, thank you for taking the time to listen today. There was more than enough pieces of value to pull from today.

y making this content. We do [:

And then also, let Elliot know if you got any questions down below or show some love at the very least, because this was super impactful. But Elliot, thank you for taking the time to be on today.

Elliot: Thanks a lot, guys. Thanks for having me.

Richard James: Yeah. Elliot, I totally appreciate you.

Closing Thoughts: Finding Your Next Lever


Richard James: And for all of you listening, you've got to think to yourself, which lever are you going to pull next? So go find your lever and that's today's pod.

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