How to charge more than competitors and attract better clients

friday, 2 september of 2011

How to charge more than competitors and attract better clients 

by Trey Ryder

Never compete on low price -- for many reasons:  

1.  You undermine your credibility because qualified prospects wonder why you charge less than other lawyers.  After all, if you're really good at what you do, prospects expect you to charge more than competitors.

2.  You attract prospects who know the price of everything and the value of nothing.  Prospects who focus mainly on price are always looking to save a buck.  To them, relationships mean little.  Whoever offers the lowest price "wins" them as a client.  Then, in the future, if they discover a lawyer who charges less than you, they move on.  Clients who are loyal to the dollar are never loyal to you!

3.  You'll find it nearly impossible to attract the number of new clients you want.  First, today's ultra-competitive marketplace makes it hard to attract a high volume of clients.  And even if you succeed in gaining the number of clients you want, in most cases, your marketing costs will exceed the profit you can earn from those clients.

When you charge a high fee, you're in a stronger marketing position, because 

  • It's easier to justify why you charge so much than to explain why you charge so little.

  • You're not striving for volume, so you can provide each client with a high level of personal service.

  • You can afford to invest money in a powerful, effective, targeted marketing program.

One reason prospects often focus on fees is because they're a common shortcut people use to evaluate quality.  Prospects conclude, "Surely, the lawyer who charges $350 per hour is more skilled than the lawyer who charges only $150 per hour."

To support a fee higher than other lawyers, explain your value in terms of the following:

Results:  Discuss clients you have represented who have similar problems.  Explain what you did for each client -- and the result you achieved.  Discuss your innovative approach to solving problems and how you often get better results than lawyers who use traditional methods.  Discuss how your reputation works to your client's advantage.  Emphasize that your clients come back time and again because they are highly pleased with the results.

Qualifications:  Discuss the number of years you've practiced law and the depth of your experience.  Explain your areas of specialization and your unusual or unique skills.  Emphasize that you limit your practice to specific areas and, as a result, have developed a high level of expertise from which your clients benefit.  Discuss how you keep your knowledge current through memberships in professional groups and bar sections, as well as continuing education.  Emphasize the many courts in which you're admitted to practice.  And if you have been on the other side -- such as an insurance defense attorney who is now a plaintiff's lawyer -- explain how this has further enhanced your knowledge and experience.

Services:  Discuss how few clients you accept -- and how this allows you to focus more time and attention on each client as an individual.  Explain how accessible you are and how promptly you respond to your clients' requests.  Discuss services you provide that are usually not offered by other lawyers.  Explain your fees and how you bill.  Point out that while many lawyers charge for every photocopy, your fee includes (some level of) office overhead.

Convenience:  Discuss your office's location in the city, the parking spaces reserved exclusively for your clients, and your easy access within the building.  Or, discuss how you work with clients by email and telephone for everyone's benefit.

Third-Party Credibility:  Offer client comments in the form of testimonials and letters of recommendation.  (Not all bar associations allow the use of testimonials, so check your rules of professional conduct.)  Offer references whom prospects can contact for more information.  Show copies of published articles you've written.

The more information you provide, the more your prospect values your services.  Also, the more reasons your prospect has to choose you, not knowing whether other lawyers can match your results, qualifications and services.

Next, in addition to providing positive reasons to choose you, emphasize the risk of hiring an inexperienced lawyer.

Emphasize that your prospect needs a lawyer who will do a thorough job and not cut corners.  Emphasize that your prospect needs a highly skilled lawyer to handle this delicate, technical or complex matter.  Emphasize that your prospect needs a lawyer who has in-depth experience so nothing is overlooked.  Emphasize that your prospect needs a lawyer who has special training in this area of law.  Emphasize that your prospect needs a service-oriented lawyer who is accessible and responds quickly.  

When faced with a question about why another lawyer charges less than you:

1.  Emphasize the First Law of Business Economics:  The person who charges less must deliver less -- or he'll go broke.

2.  Emphasize that in today's marketplace, at best, you get what you pay for.  Sadly, many clients get much less.

3.  Emphasize that a low fee is an obvious sign of weakness -- because if the lawyer had even a moderate level of knowledge, skill and experience, he would charge more.

4.  Emphasize that when the stakes are high, the cheapest lawyer, in the long run, often proves to be the most expensive.

5.  Emphasize that you don't know (or can't be sure) what the other lawyer offers.  And, since he charges less than you, it's logical to conclude that the other lawyer offers less.  It could be less knowledge, less experience, less skill, less service.  Is it worth the risk to find out?

6.  Then, with a question in your voice, add:  "I wonder what he's leaving out."  With those six words, you emphasize doubt, arouse suspicion, and increase skepticism.  And you do this legitimately because neither you nor your prospect knows what criteria the other lawyer uses to establish his value.

Prospects want a clear picture of what they get when they hire you.  The more specific you are about your knowledge -- skill -- experience -- qualifications -- results -- services -- and anything else your prospects view as important, the more value they place on your services and the higher fees they're willing to pay.

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© Trey Ryder

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