Without Disruptive Innovation, Many IP Law Firms Destined to Meet Same Fate As Buggy Whip Makers

A possible upside to the recent economic downturn is that many previously accepted business models are being revealed as in need of substantial reinvention or even total elimination. The billable hour/leverage law firm model for legal services is one of these increasingly maligned business models, and is now appearing to be in danger of ending up in the dustbin of history. Specifically, even those who benefit handsomely from the billable hour, such as the Cravath firm’s many $800 per hour lawyers, now realize the fundamental irrationality of charging a client for time spent instead of value provided. This alone should signal that change is in the air.

Notwithstanding the growing conversation about the need for alternative client service models, I fear that the majority of IP law firms will either try to ignore the desire for change or will respond by offering only incremental modifications to their existing methods of providing legal services to their clients. As someone with considerable experience dealing with IP lawyers, I believe that, unfortunately, the conservative nature of most IP attorneys means that IP firms will likely lag behind in client service innovations. Thus, I am of the opinion that many prestigious and historically highly profitable IP law firms will in the foreseeable future cease to exist.

I reach this conclusion as a result of various salient experiences. In one of these, several years ago, I approached a managing partner of a well-known IP law firm with suggestions of how to decrease the number of attorney hours expended on client matters. At that time, the firm was beginning to experience considerable push back from clients about the cost of routine legal services. I noted to the managing partner that he could lower the cost non-substantive e.g., administrative client IP matters, by assigning such tasks to lower billing paralegals. His response to this idea: “If paralegals did the work, what would the 1st and 2nd year associates do?”

Of course, the central premise of the managing partner’s response was that in order to keep the gears of the firm’s billable hour/leverage partner model turning smoothly, he needed to keep the young associates busy billing by the hour. The existing paradigm of his law firm required that it keep hiring associates to increase partner leverage and ensure that they efficiently billed clients by the hour, with a significant portion of each associate’s billed time directly going into the partner’s pockets. Left out of this business model was whether the clients’ best interests were properly served by the model that best served the law firm’s partnership.

Clearly, this law firm was not well managed, which might serve as an excuse for the managing partner’s self-serving perspective on client IP legal services. However, my experience as a corporate buyer of IP legal services further revealed that that the billable hour/leverage partner business model was an arrangement that frequently ut the client–which was now me–after the law firm’s interests.

As an in-house counsel spending several $100K’s per year for legal services at a number of respected IP firms, I consistently felt that when I called outside counsel for assistance the first thought that popped into the lawyer’s mind was “So glad she called–I wonder how much work this call is going to lead to?” More often than not, I got the sense that my outside IP lawyers viewed my legal concerns as problems for them to solve on a per hour basis, not as issues that might affect the profits of the company for which I worked. The difference is subtle, but critical: the context of the former is lawyer as a service provider, whereas the latter is lawyer as a business partner.

Against these experiences, I was not surprised at what I heard recently when discussing my feelings about the billable hour/leverage model with a partner friend at one of the top IP specialty law firms in the US. This partner echoed my sentiments about the need for innovation in IP client services. However, she also indicated that most of her firm’s partners do not recognize that there is a problem with the way they currently provide IP legal services to their clients. As she told it, many of her more senior partners have been living well on the billable hour/leverage model, so they currently see little need to modify their behavior. My partner friend nonetheless realizes that her law firm is critically ill and is likely to soon experience something akin to sudden cardiac arrest. Sadly, she is not a member of her law firm’s management and, since there is no upper level recognition that change is needed, it would serve little purpose for her to raise her concerns to those partners who could effect change (and would probably not be politically expedient for her to do so).

The failure of these currently well-compensated IP law firm partners to recognize the shifting winds of their client’s acceptance of their billing practices–the fundamental basis of their law firm’s business model–mirrors the response of entrenched interests throughout history to innovations that did not mesh with their existing business model paradigm. Moreover, the inability of many IP law firms to recognize the climate for change leads me to believe that many of these venerated law firms will soon meet the fate of buggy whip manufacturers if they do not innovate in the manner by which they provide legal services to their clients.

Playing out this analogy, buggy whip manufacturers met their demise because they thought they were in the buggy whip business when they were actually in the transportation business. When buggy whips became obsolete, so did these formerly prosperous manufacturers. Notably, buggy whip manufacturers possessed the ability to change and thrive in the new world of the automobile. They already held strong business relationships with the buggy manufacturers that became the first automobile companies. They also employed skilled craftsmen who could have turned their efforts to making leather seat covers or other aspects of the automobile. These buggy whip manufacturers needed only to accept that they needed to ride the wave of innovation occurring at that time and reinvent themselves as suppliers to automobile manufacturers instead of buggy makers.

Like buggy whip manufacturers, I believe that many lawyers have become so entrenched in the law firm business that they have effectively forgotten that they are first legal services providers. As people charged with ensuring the continued vitality of the business, law firm lawyers often become primarily fee generators in that the fees are obtained from billing clients by the hour for legal services. Care and feeding of the law firm and its partners by ensuring constant creation of billable hours therefore often takes precedence over the legal needs of clients. Also analogous to buggy whip manufactures, IP lawyers working in law firms have the ability to change to prevent obsolescence. Indeed, these lawyers possess the requisite skills to continue practicing their craft outside of the existing paradigm of the law firm. Still further akin to buggy whip manufacturers, lawyers also have the existing relationships with customers i.e., clients, which gives them a valuable head start over newcomers who wish to enter the IP legal service arena using innovative, but unfamiliar, client service models.

Using the well-known picture of obsolescence presented by buggy whip manufacturers more than 100 years ago, I believe that IP lawyers who recognize that they must embrace innovation in the way they provide IP legal services to clients will be poised for success when their clients decide that the time for change has arrived. On the other hand, lawyers who believe they are in the IP law firm business will invariably be left behind when innovations in client service enter the marketplace that render the law firm business model obsolete.

IP lawyers should not expect that they will be able to predict when their clients will demand change. As with the customers of buggy whip manufacturers, law firm clients will not serve their IP counsel with notice warning prior to taking their business to lawyers who provide them with innovative, and more client-centric, service models. To the contrary, when clients are finally presented with acceptable alternatives, they will naturally migrate to the innovation that best meets their business needs. The result will be that one day, these currently successful IP lawyers will likely wake up to realize that they are losing their clients in droves to lawyers who succeeded in developing and introducing an innovative client service model to the world. And, as most lawyers will tell you, once a client is gone, they are likely gone forever.

Not only will clients fail to announce that they intend to leave their law firm before they do so, they also will not tell their lawyers how you can serve them better. Why should they–they are not in the business of providing legal services. Accordingly, mutually beneficial client service innovations must be generated by and because of lawyer action. But, because of their inherently conservative nature, I believe that many IP lawyers may fail to realize that innovation is critical until it is too late to preserve their client base.

Some might contend that complaints about the billable hour model have abounded for many years, but no major changes have occurred to date, thus indicating that most clients may be all bluster and no action. While it is certainly true that clients exerted no real pressure on lawyers for change in the past, circumstances are markedly different today than before. Disruptive innovation is rocketing through society, and many formerly solid business models, such as newspapers and recorded music, are now teetering on the cusp of demise as a result.

The signals are there that law IP firms that rely on the billable hour/leverage model appear poised to experience significant stress from clients and critics in the near future. Those relying on this model for their livelihood would be well-served to look for innovative ways to address this changing environment. In short, those who think that the billable hour/leverage law firm model will escape the transformative business innovations of the current era are merely “whistling past the graveyard.” IP law firms, as well as other types of law firms, must innovate now and innovate big or I fear they will suffer the fate of the buggy whip makers.

Common Qualities of the Best Law Firms

In my 12 years of practice, I have been employed with a wide variety of law firms. When I decided to open my own practice, I started thinking about the qualities that make up the best law firms. In determining the best law firms do you include things such as employee benefits, firm culture and employee turnover rates? Or do you focus on the qualities that affect a law firm’s most precious commodity – the client? My take on this is that the best law firms employ quality attorneys and staff with the highest of ethical standards and the desire to fight within their ethical bounds for their clients.

One key factor in having a successful law practice is an effective leader. A good leader will have a vision for the firm’s direction, a commitment to serving its clients, and a desire to find like-minded people that believe not only in the clients, but the brand of the firm. I have found in my practice that effective leaders can quickly change with success and growth. They often lose touch with the very people that helped them grow into a successful powerhouse. It is easy to go from a scenario of weekly partner/associate lunches to rarely, if ever, seeing a partner in the office. Effective leaders at the best law firm have a good understanding of the legal work coming out of the office, the overall satisfaction of its clients, and an awareness of the employees’ overall job satisfaction. With success and growth, it is easy to lose touch with these important factors, but good leaders will remain cognizant of these factors, even with exponential growth of the firm.

The best law firms also have compassion for their clients. When attorneys at these firms meet with clients, it’s never about sharing the attorney’s successes. Rather, it’s listening to your clients concerns, determining their overall goal through representation by the firm, and showing empathy towards their situation. Many attorneys look at their clients and see dollar signs. They look at the opportunity to bill or the total fee they will earn on a contingency for a huge settlement. These attorneys fail to recall one of the most basic ethical consideration of attorneys, acting in the best interest of the client. Because at the end of the day, all the billable hours in the world won’t make a practice successful If you don’t satisfy and take good care of your clients. Firms with this mindset often have high turnover rates because they make billing THE priority. They burn their attorneys out and bring in brand new attorneys and start the process fresh with them. This can easily lead to dissatisfaction by clients. They may not know from one month to the next which attorney is representing them.

Another key quality of the best law firms is a narrow focus on a particular area of law. The days of general practitioners is (or should be) gone. Laws are complex and can change in an instant depending on legislation or new case law handed down by appellate courts. The best law firms have focus on one area of law and become very good at it. They are aware of recent changes as well as developing changes in their area of practice. With such a narrow focus, they can change strategy in an instant and become the authority to their clients by showing their knowledge in a particular area of law. Beware of the lawyer who claims to practice in all areas of civil litigation. While it is possible, consider that opposing counsel may have a more narrow focus. They may have that golden nugget of information that can make the case a winner for them and a loser for your client.

There are a number of other factors to consider when trying to determine the best. That may be the discussion for a future article. But those discussed here are, in this author’s opinion, the most important factors to consider when trying to figure out what makes a firm one of the best.

Content Marketing and Web Analytics: The Yin and Yang of Any Successful Law Firm Marketing Campaign

Good content has always been one of the best ways for a lawyer to establish and maintain a professional reputation. In the hands of potential clients, good content demonstrates your understanding of the law and your ability to do what you claim to do.

Let’s say you write an excellent article on the recently signed patent reform act.

Prior to the Internet, your options for distribution of that article would be limited. You could submit it to print publishers who could decide whether or not to publish it and how to edit it. By the time it appeared on a client’s desk, it might be three months out of date.

In addition, you could snail mail a copy of your article with a cover letter directly to your list of clients, potential clients and referral sources. You could include it in the firm’s print newsletter. You could mail it to reporters covering the patent law beat and hope that they give you a call next time they are writing a story on that topic.

And that was about it. You really had no way of knowing what happened to that hard copy – if the publication was read or if the envelope or newsletter was even opened.

Today, thanks to the Internet, the options for distributing a well-written and informative article (and all kinds of content) to a wide range of interested parties are vastly expanded. So, too, are the options for finding out if the article was opened, was read and prompted further action on the part of the reader.

In the Internet age, online content marketing is the best way for lawyers and law firms to establish their reputations and attract new business. And web traffic analysis is the best way for lawyers and law firms to measure the success of a content marketing campaign and move forward based on that information. Content marketing and web analytics are inseparable parts of the same strategic process.

Online content marketing for law firms

Online content marketing involves publishing content (like the article on patent law) on your law firm’s website (including mobile website version), client extranet sites or blogs. It involves the e-mailing of your article (or newsletter) to clients, potential clients, referral sources and media sources.

An integrated online marketing program is an essential part of a law firm’s marketing program. Content marketing involves distribution of your content using popular social media sites (like LinkedIn, Facebook, Twitter and YouTube) as well as successful content syndication sites (like JD Supra, LegalOnRamp and Scribd).

Each time your keyword-rich patent law article is published on one of these sites, it is indexed by Google and other search engines – enhancing results for searches on terms like your name, your law firm’s name, your geographic area and the relevant subject area.

The term ‘content’ applies to almost any kind of material your firm is publishing. It applies to documents like press releases, experience descriptions, attorney biographies (profiles), client alerts, blog post, white papers, email campaigns and e-books on legal subjects.

Content also includes non-written files, like an online ad campaign, courtroom graphics, a PowerPoint deck, or photos of an open house or employee charity event. It includes online surveys along with survey results. And it definitely includes audio or video recordings of a presentation, a seminar or a webinar.

All types of reputation-demonstrating content can be posted not only on your own website, but also to a wide range of (mostly free) social media and content syndication sites. Once posted, this informative content is available 24/7 and around the world.

Web analytics for law firms

Not only does the Internet facilitate the wide distribution of content,”it also allows lawyers and law firms to closely track distribution – to know how many visitors click on the content; how much time they spend reading, listening or viewing the content; and where (your website, search or some other site) they found the content.

Web analytics is a process for collecting visitor or consumer data, analyzing those data and generating reports on the overall performance of these different channels. It extends well beyond your website into virtually every online channel your law firm might be using.

In the early days, web analytics programs focused on the simple measurement of activity on a law firm’s web site. Today, a good law firm website still contains useful information about the firm and its services, but the site functions more like an interactive hub to which all of the firm’s online content distribution efforts are tied.

In addition, most social media sites have their own built-in analytics programs that can be accessed for more details about activity on your accounts on those sites.

The popular Google Analytics program is free and yields information about site visitors, including number of visitors (unique, new and repeat), page views, repeat rate, visit length, page view length, page view per visit, bounce rate (those who leave quickly from a given page), entry pages (where visitors enter you site), exit pages (where visitors leave your site) and referral sources (direct traffic, search engines and other referral sites).

Among other things, Google Analytics can chart data over time, compare data month-by-month or year-by-year, and internally compare different sets of results.

Other commercial web analytics programs allow the site administrator to ‘dig deeper’ into the data. Most analytics programs will record detailed information at the user level, allowing administrators to track the number of times a given user came to the site, which pages he or she viewed and, in some cases, the location from which that user is connecting.

At Tenrec, we combine basic Google Analytics with a program called Urchin (essentially, Google’s commercial analytics product) to obtain different levels of results for our clients. There are many programs out there. The one you select should be determined by how you plan to use the results.

It is important to remember that no performance metric is inherently bad or good. A limited number of the right kind of people visiting your content and reaching out to your firm is a better result than hundreds of visitors who take no action.

Strategic content marketing and web analytics for law firms

Web analytics programs are capable of generating a vast amount of information. There are far too many metrics for users to process and interpret. Measurement tools are only useful when there is something specific to measure.

The challenge is not to get more data, which can needlessly complicate your decision-making, but to get better data. Be strategic. What is the purpose of this online content campaign (within the context of our business goals), and which select measurements will indicate progress towards achieving this goal?

Let’s go back to that article on patent reform. You post it on your website. You reference it in your blog. You e-mail it to clients, potential clients, referral sources and media sources. You post it (with links back to your site) on a variety of social media sites and content syndication sites.

On your website, analytics will let you know who visited the page and how they got there. In addition, you will discover if they stayed a while, read the article and downloaded a copy.

If no one comes or if visitors take a quick look and ‘bounce,’ you know that there is something wrong with the content. The subject is not newsworthy. The headline or keywords need work. The article is too long or too short. It is too dense and needs shorter lines and subheads, to encourage skimming. It is too casual or too filled with legal jargon. In other words, it needs work.

An e-mail analytics program will let you know who opens the e-mail and clicks on the link. Other analytics programs will indicate how your article fares in the blogosphere or is shared or re-tweeted on social media and content syndication sites.

The information generated by web analytics is a valuable tool to help lawyers and law firms plan — and continuously improve — their content and their online content distribution campaigns.

Law Firm Marketing: How a Bald Move Can Help You Stand Out From the Crowd

Recently, an Atlanta personal injury lawyer has been making waves in the blogosphere with a creative new law firm marketing campaign. The attorney, now – and perhaps forever- has become known as the “Bald Lawyer.” His billboard campaign has attracted attention not only in the ABA Journal, but also on a whole host of other sites, even showing up on the website of a major communications firm in the United Kingdom. With the amount of widespread positive attention he’s receiving, it seems clear that his creative advertising effort was a complete success.

Innovative Law Firm Marketing: Standing Out From Your Competitors

Law firm marketing has become ubiquitous, with a lawyer billboard on every corner and lawyers promising to get you a fast divorce or a big cash settlement during every commercial break. Because there is so much legal advertising going on, it can be very difficult to get potential clients to sit up and take notice.

Lawyers have a special challenge in getting customer’s to pay attention, since unlike selling a sleek and sexy new car or a cool new beverage, lawyer’s aren’t selling a lifestyle. Many of the lawyers who advertise offer aid to people who usually will become interested in their services only when something has gone wrong, and for everyone else, their ads will blend into the background.

Even when someone is seeking a lawyer, clients are going to have a hard time differentiating between one lawyer’s promise to “get justice” or “get results” and the similar promise made by countless others, often all standing in front of the same stock set of law books in the generic law office so popular in legal ads.

Not so for the Bald Lawyer. His eye-catching billboard features the slogan “Injured? Don’t Pull YOUR Hair out!” Below that is a big shot of the lawyer with his bald head, and the address for his website ‘MyBaldLawyer.com.”

What Makes The Bald Lawyer Ad Work

The Bald Lawyer ad works and stands out from other law firm marketing because it is different. It shatters the stereotype of the conservative, unapproachable and uptight lawyer by allowing the attorney to poke fun at himself… yet it does this without undermining the law or the legal profession.

The billboard also stands out because it attracts attention and because it gives the reader a memorable image. That image is accompanied by a website directly related to it, which fixes itself in the viewer’s mind right along with the image, becoming easy to remember.

Clients who see the bald lawyer ad will take more notice of it- even if just for a few seconds out of curiosity- than they would just another lawyer ad. This can translate into the ad staying in their minds, consciously or subconsciously. In turn, when they need a lawyer, they may just be tempted to visit the website they remember from the billboard where the client can learn about the services the bald lawyer offers.

Creating Your Own Innovative Ad

Other attorneys who wish to take their law firm marketing efforts to the next level can take a page out of the bald lawyer’s book. The ad is an important reminder that innovation is key in successful legal marketing, and that by offering clients some way to distinguish you from your competitors (preferably a memorable way), you can stand out from the rest.

When crafting your own marketing campaign, think of what makes you different. What aspects of your law practice management or law firm help you to stand out from the crowd and add value to your clients? If you can identify something that sets you apart and you can present that something in a new and creative way, your law firm marketing campaign is sure to be a great success.