This estimate is coupled with the expected time savings resulting from the use of the Clio platform, assuming that the time saved on non-billable tasks will instead be used for billable work that generates revenue for the law firm. It`s important to realize that understanding whether innovation provides a good return on investment is a best practice for businesses. By introducing change in a small and iterative way, you can not only better measure ROI, but also avoid the error of sunk costs. As we noted on our last blog, iterative change is cheaper, more efficient, and increases your profit margins. The most important idea should be: process improvement is only related to the overall profitability of your business. But if you don`t measure and test process improvement, then you might as well not do it at all. NOTE: The information used to create Firm Central`s ROI calculator comes from a 2014 Blue Hill Research study, « Building a Business Case for Law Practice Management. » Blue Hill conducted interviews with 45 law firms with approximately 50 or fewer lawyers about their assessment and implementation of practice management solutions. ¢ 4-8 hours â Reduction of lawyer`s time per month for administrative and non-billable work ⢠Calculations based on average company size and 50% investment in time and money. First, consider your investment. Money spent on marketing can be pretty easy to track if your firm works a lot with a professional legal marketing firm. In fact, the marketing company should send regular reports that not only detail where you spent your money, but also show some results. If you use our calculator, a 20x ROI would mean that for every $1 invested in Clio, you`d earn an extra $20. In addition to financial returns, Firm Central simplifies and automates operations for everyone in the company, including non-billable employees, so everyone can focus on higher value-added work.
Hear from a legal assistant on the benefits of Firm Central. Leads are essential for online business marketing, but it`s important to consider every step of the process. Analytics tools, such as those offered by Google Analytics, can show you the number of unique visitors to your website. Tracking software can help you determine how many of these visitors fill out contact forms and become leads. You can compare new customer lists to see your conversion rate from visitors to leads and leads to customers. You should also determine an average revenue generated per customer or customer type. Potential customers who have shown interest in your business are called prospects. Since most law firms need new clients to remain viable, the process of generating new leads should continue. How can you know if this process is working well? For example, if you find that the average revenue per customer is $6,000 and your Google ad campaigns attract two new customers per month, those ads will earn $12,000 per month. How much do you spend each month to create content and place ads? If possible, the same analysis should be done for each online marketing journey. If you work with a marketing company and they don`t automatically provide information about leads generated by ads, blogs, or unique visitors to your site, ask for that information.
If you need help figuring out how many of your new customers are coming from different marketing efforts, ask your marketing company to find the best ways to track that information. They are there to help you maximize your return, and they should be able to show how they achieve this goal. The number displayed by the ECU is not a guarantee and should only be interpreted as a possible result of the use of the Clio platform. The calculation presented is an informed estimate, based in part on data analysis that compared groups of Clio users based on the number of features they used in the Clio platform. This analysis identified positive revenue generation trends associated with the use of more Clio features. These trends are averages observed among a large sample of Clio users, and your own experience can vary greatly. Many small and individual law firms recognize the potential value of practice management tools, but are not convinced that this value is worth the investment of time and money. The average Clio customer saves 8 hours per week. Calculate how much additional revenue your business can generate if those hours are better spent.
Understanding how to calculate your internet marketing law firm`s return on investment is the first step to unleashing the power of effective marketing. Marketing based on intuition or optimism may be traditional in legal affairs, but it is not an effective path to success. Yes, there are additional cost savings that may not be reflected in the calculator without a full analysis of your business setup. To give your business the best chance of getting an accurate return on investment, make sure you have the following skills or technologies: Over time, ROI calculations outside the legal world have become increasingly sophisticated. McKinsey & Company is studying a particularly interesting model based on key figures. Erik Roth, senior partner, shares research suggesting that it is enough to monitor the ratio of R&D expenses to sales of new products. and the ratio of new product sales to gross profit margin. The information required for such a calculation is (usually) easy to obtain. For companies that already have an R&D department, this could be an interesting way to determine their overall return on investment in innovation. Clio changed the game, it took us from a $4 million company to an $8 million company in two years. Learn how you can create more billable hours in your day when running your business with Clio`s case management solution. This is a fairly standard calculation method, but it can be daunting for many companies due to the amount of data required and the uncertainty surrounding some of the numbers.
We recommend using a comparable comparison whenever possible. Most companies will use iterative and targeted change management (why this is most effective can be found on our blog here). Therefore, the introduction of new technologies is likely to serve a specific purpose. Reduce the time spent on due diligence, say. Or speed up the business search. Above the Law shares a fairly detailed breakdown of ROI calculation methods for law firms. They recommend the following method: Call tracking software, unique tracking links, and lead tracking software are useful tools for analyzing where traffic is coming from so you can see which online marketing channels are performing best. Old-fashioned methods, such as Asking a customer directly how they discovered your business can also give you an indication of how different forms of contact with your audience connect and convince them to become customers.
