How solo and small firms can keep up with profession trends
The world has changed in the last year-and-a-half, so it’s no surprise clients’ expectations of interactions with lawyers has shifted too. Solo and small law firms that quickly adjusted to those changing expectations saw an increase in additional revenue – more than $50,000 per lawyer to be exact.
As Affinity partnerships manager at Clio, Rio Peterson works with bar and law association partners to teach lawyers how to use technology to build successful, long-lasting businesses. During the bar’s 2021 Solo & Small Firm Conference on June 10, Peterson spoke with hundreds of conference attendees about the trends overtaking the legal profession and ways lawyers can adjust.
“We’re actually witnessing this huge shift and it’s not a small percentage change,” Peterson said. “We’ve seen a leap in a totally new direction, so it’ll be interesting to see things in a year from now and to see just how much of this will stick around.”
During the pandemic, solo and small firms saw a drop in caseloads. About two-thirds of lawyers surveyed were concerned about the success of their legal practices, while nearly half of lawyers were worried about making a living in general, according to Clio’s annual study, “Legal Trends Report.”
Those struggles could be accentuated if law firms do not keep up with legal trends, Peterson said. About 52% of clients Clio surveyed said they used more types of technology than they did before the COVID-19 pandemic – and most consumers surveyed said technology was more important to them now than it was before the pandemic.
“This comfort with technology, it isn’t going to suddenly go away and disappear, even if we get back to some sense of normalcy,” Peterson said. “The use of these different tech tools has become part of the norm of how people are engaging.”
Law firms that adjusted to their clients’ changing expectations found a way to increase their business during the COVID-19 pandemic though, Peterson said. Law firms collected additional revenue and consistently out-performed competitors if they were using electronic payments, client portals, and client intake and client relationship management (CRM) software. Firms that used all three of these tools earned an average of $52,507 in additional revenue per lawyer, according to Clio’s study.
If a solo or small firm wants to start implementing one of the three suggested changes, Peterson recommended it start with online payments since it’s the easiest to implement. There is also a huge desire for it among clients – 72% of consumers said they would prefer to pay their legal fees through online payments, but only 53% of law firms were equipped to offer payment plans, according to the study.
That’s why it’s important for law firms to offer online payments to clients, Peterson said. It also may help address lawyers’ concerns that their clients would not be able to pay them, she added.
More than 60% of clients Clio surveyed said they could not afford a legal problem at the time of the survey, especially since several individuals lost their jobs or experienced financial hardships during the pandemic. Before the pandemic, in 2018, the Federal Reserve found that more than a third of Americans would be unable to cover an unexpected $400 expense.
“If we’re talking about that in billable hours, that’s about an hour and a half, and I don’t think many matters are concluded in an hour and a half,” Peterson said. “So, the point here is not that a matter should cost $400 or less. The point is that we need to think about ways to create pricing and packaging models that allow people to be able to work with you and pay you.”
To learn more about online payments and frictionless billing, click here.
Client intake and CRM software
When potential clients contact law firms, they want a response within 24 hours, even on weekends, Peterson said. Potential clients commonly pick the law firm that responds the quickest, she added, meaning speed and convenience are key. Using client intake and CRM software, lawyers can create online schedulers, automated email follow-ups, and collect information from clients easily.
“It lets you give the appearance of being available 24 hours a day without actually being available 24 hours a day,” Peterson said.
When Clio surveyed clients in 2018, Peterson said, they found there were certain legal activities clients still felt more comfortable engaging in person, such as giving and receiving sensitive legal documents. Two years later, in 2020, Clio found more than two-thirds of consumers preferred lawyers who could share documents through web-sharing portals or online interfaces.
Client portals allow for timely case updates and secure document sharing, Peterson told Solo & Small Firm Conference attendees. It also creates a consistent communication between lawyers and their clients, building a strong level of trust. Click here to learn how lawyers can find other ways to maintain communication with their clients, even after representation.
Regardless of what tools solo and small firms choose, Peterson said, the technology should address a problem and work together. Law firms are unique too, so it’s important for lawyers to consider what would be best for their businesses.
“Not every tool works for every law firm. Law firms are like snowflakes – you have to find the right tools for your law firm,” Peterson said. “The second is any tool you are using or going to implement at your firm, it needs to solve a problem. Don’t get distracted by all the shiny, amazing tech tools out there.”
More than 890 Missouri lawyers attended The Missouri Bar’s 26th annual Solo & Small Firm Conference, hosted by MoBarCLE, from June 9-11. During the virtual conference, lawyers learned tips and tricks from experts to improve their solo and small law firms, help them even better serve their clients, and earn MCLE hours.