Today, I’m bringing you another recap from LMA’s 2014 Annual Conference, from an excellent session I attended on the first morning, called "Playing the Relationship Game in Today’s Connected World."
For relationship-based businesses like law firms, the connections that firms make with their clients – and the connections these clients have with each other – have a profound effect on the amount of ongoing business and new opportunities they’ll win. Thanks to the ever-connected world we live in, it is now essential that firms align their digital marketing and business development efforts along what we like to call The Relationship Cycle."
In this session, we’ll provide examples of how businesses are using interactive marketing to reach their clients at every point in the decision-making experience, establish trust and create advocates that help drive new business opportunities with current and prospective clients. As this is The Relationship Game, a handful of contestants from the audience will participate game-show style to help us identify key interactive trends, reveal best practices for building digital relationships and uncover key findings from our latest General Counsel Survey."
The presenters began the session by showing us some brands and asking what they have in common – brands such as Nike, P&G, McDonalds and Apple. The audience agreed that they have instant recognition, are massive consumer brands, and are all known for their marketing prowess.
The presenters agreed that they’re powerhouses when it comes to marketing – whatever you think of their products. These companies have each historically spent up to $1 billion per year in advertising alone.
But these brands are looking at us for how to create relationships with their customers – they’re now in the relationship era, and we’ve been in this space as long as law firms have existed.
The shift to a relationship era approach suggests a decreasing reliance on the traditional use of mass media to influence and persuade a passive audience to buy more of whatever the marketer is trying to sell."
Relationship Era marketers embrace approaches that build stronger relationship between their brands and people."
These days, people trust anonymous reviews more than they trust what a brand says, because they’re putting their trust in those who have worked with you in the past.
P&G, for example, say that they’re toning down their advertising message, because the best form of marketing is the kind that doesn’t feel like marketing. You can’t say enough (as a brand/firm) that people will believe that can compare with what people experience.
Law firms aren’t Nike – we’re in the relationship business. So we face a different sales process than consumer brands.
The presenters asked us to think about legal clients for a minute: let’s say that you’re a general counsel, facing a critical issue. You’ve identified that you have a need, and will likely do some searching. You’ll then start to research a solution in full, and see who can help you address the issue. You may then go into an active evaluation phase, and at some point, formalize a relationship.
That’s where the traditional sales call ends – not true for relationship businesses. Instead, this is the point where we hope clients enter the "loyalty loop." This stage is where a firm has the opportunity to establish trust and advocacy with their clients, so that the next time they have a need, they keep coming back to you regardless of the issue, and help to drive others to your business.
The presenters took us through each of the phases of the cycle.
Stage One: Research Solution
In the first stage, a client has a need and is trying to frame the problem. So what are we as marketers doing to try to build awareness in the market?
Only 30% of B2B businesses are cold calling because they understand that the customer has shifted to organic discovery – they’re getting recommendations and searching online. The customer is enormously empowered to ignore ads, and organic marketing is just more authentic. Businesses are engaging, talking to people, and keeping themselves present.
One of the most effective tactics at this stage is social media. The US is very far behind when it comes to social media, as it compares to other users. Emerging markets share far more online than we do in the US. So firms with international business can’t be so US-centric that we believe the US habits are the only ones. We have to be asking ourselves what happens when the US finally catches up.
Forrester calls this the "Age of the Customer." From 1990-2010, we were in the Age of Information, but the information parity has shifted. Because we can communicate online so efficiently, there are many situations where the customer may have more information about your services and how they’re delivered than you do. Because of this, the buyer has greater bargaining leverage (whoever has more information always has the upper hand).
The presenters noted that a good read for all of us would be Google’s ZMOT: Zero Moment of Truth.
Stage Two: Active Evaluation
According to a McKinsey study, 57% of purchase decisions are completed BEFORE the supplier is contacted – what this means is that more than half of the time, a client has made the decision of who to hire before they even contact you for an RFP.
The relationship actually starts long before they call you.
Context drives consideration and loyalty – so to get into the "consideration set" before anyone starts talking to you, you have to be present. The best way to do this is through content marketing. Context also matters, so you want to stay present in multiple contexts (mobile apps, case studies, thought leadership, white papers, etc.).
Stage Three: Formalize relationship
55.4% of B2B marketers have programs dedicated to client retention, according to SAS and Loyalty 360 (those numbers are overall B2B, not limited to law firms). This is still low – marketers are not paying enough attention to retention.
A lot of our revenue comes from current clients, but we’re not doing anything dedicated to generating more revenue from that stream – that’s a HUGE missed opportunity.
Stage three is about how you generate loyalty from these clients, or in other words, how do you keep the revenue going?
The presenters talked about a brand awareness survey from McKinsey, which looks at what clients care about:
- Honest, open dialogue
- Fitting in with their goals
- Acting responsibly across the supply chain
- High level of specialist expertise
This last point is the only area that matches the information that law firms are putting out. How are we communicating the first three? By addressing only our level of expertise, we’re really only targeting new or prospective clients, not connecting with current clients.
They also referenced a GC excellence report, which noted that only one in eight firms always meet up with their clients to find out how satisfied the legal department was with their work. 18% never meet with their clients to discuss satisfaction – that’s one in five firms who never meet with their clients about satisfaction.
Stage Four: Loyalty Loop
Finally, we get to the magical part, the loyalty loop.
The presenters told us that 86% of general counsel cite referrals as the most trusted source when researching a law firm (from the GC Excellence Report). 65% use law firm websites, while 57% use information directly from the firm.
So that’s only half of clients who really find the information you’re handing them to be valuable. What they want to do is talk to someone in the loyalty loop. All of your clients refer work – all of them. Even if they’re not prompted by you, and regardless of whether their experience with you is good or bad. That’s a habit of buyers.
The Relationship Game: What It Means for US
So what does the relationship game mean for us? For marketers, our jobs are changing fundamentally from what they were even ten years ago.
Big Data will inform our approach
It’s not here yet for legal, but it’s influencing the way many organizations are marketing. For example, Capital One can get all kinds of information from an "anonymous" user of their website, without it being explicitly given. And they can then follow up with a targeted ad, just for that person. All of that will ultimately affect how we market.
We should be looking across all of our channels and starting to create profiles of the persistent experience that we want to create for users. Very few firms are looking across the spectrum of what they’re doing. It’s the "Omni Channel" marketing problem – if you’ve been in legal marketing for ten years or so, there’s been exponential growth for what you have to manage. Big data will have a big impact on how we market in the future.
Cross-channel content marketing is an essential skill
Cross-channel content marketing becomes the essential skill of a legal marketer today. "Content marketing" is a buzzword, but it’s something that the legal industry has done for years – we’ve all been publishing things from our lawyers for years, we just didn’t have a term for it. Finally, everyone else is coming around.
The Content Marketing Institute looks at the hallmarks of someone who is really good at content marketing, and did a survey within B2B marketing. Those who feel that their content marketing is effective:
- Have a documented strategy, which is written down and refreshed.
- Have someone in charge of this strategy.
- Use a huge number of tactics (whitepapers, email, CRM, etc.) – an average of 15 different kinds of tactics and seven different social media platforms, not just the top three.
- Use almost 40% of their budget on content production.
The Marketing Leadership Council says that multichannel management is a sign of maturity and effectiveness. People are in the consolidation phase now – they’ve had social media experts and other experts, and now, they’re looking at coordinated cross-channel campaigns instead. This is the hallmark of companies like Google.
Stories, not taglines will represent our brands
When we traditionally think of a "brand," we think of our logo, colors, fonts, maybe even our taglines. The problem with this is that those things are all momentary – they’re designed to create an impression, but the relationship cycle is long-term and complex, with lots of points of contact.
To base this on an impression can’t be done, and isn’t relevant – it’s not how people want to interact with you. We’re seeing a number of organizations change the notion of their brand from a tagline or impression to a story, and using story-based techniques, and turning to digital rather than print.
Kalev and John gave those of us in the audience a LOT to think about – are you seeing more focus these days on the "loyalty loop" at your firms?