Extra, Extra! Break Free from the Billable Hour

Episode Notes

Transcript

Speaker 1:

Welcome to Lunch Hour Legal Marketing teaching you how to promote market and make fad stacks for your legal practice here on Legal Talk Network.

Gyi Tsakalakis:

Welcome to Lunch Hour Legal Marketing. Hey, it’s Gyi. We have a bonus episode from ABA Tech Show in Chicago. I had his chance to sit down with Kim Bennett and Blaine Korte of Fidu Legal., Super excited about what Kim and Blaine are up to. They recently announced integration with LawPay and are really some pioneers and leaders in the space of subscription based law firms. Hope you enjoy the interview,

Kim. I know for years you’ve been dragging lawyers into the future trying to blow up the billable hour. When I talk to lawyers about that, they love the idea, right? They’re like, I hate the billable hour doesn’t scale. I’m stuck. I’ve got a bill time and now this AI thing’s coming around and I’m automating all this stuff and now I’m struggling to find hours to bill. How do you have that conversation with a lawyer who’s into it, but how do they even get started with thinking about how to make that change? How do they decouple from the billable hour?

Kim Bennett:

Yeah, I think the biggest thing, if they’ve already started it and they’ve started automating, the thing that takes you from where you are today to a recurring revenue business is truly saying to yourself, what value are you bringing to your clients? And I think if you’ve designed, created process systems, created products that focus on the journey of the client that you’re talking to on the marketing side, that you’re bringing them, then in once they say yes from marketing and sales, yes to becoming a client, then you can start switching and saying, Hey, it’s not about me chaining time for money. It’s about helping them reach some type of outcome, some end result. I think when we think about stories like a family lawyer or estate planning lawyer, a lot of lawyers like, I’m helping them get a divorce. That’s nice. No, that’s a point in time.

What are you actually helping them do? You’re helping them get to a place post-divorce where maybe they have a happy co-parenting relationship. Maybe they’re financially stable to be able to move forward and start a new life maybe in estate planning. You’re not simply helping ’em get a will or trust. You’re really helping that family create a plan of action so that when that person that created that estate or plan isn’t here, that their family will be well taken care of. They’ll know how to navigate finances and not feel overwhelmed and stressed in that moment. And so I think when you’re starting to say, I’m really trying to process out what I do, then you have to say, okay, it’s not about me trading time for money anymore. It’s about what does that client want longterm? What’s their journey? And then start designing towards that, which is bigger than I think a lot of what firms do today. We’re still very reactive and ditching the billable hour, moving to recurring revenue models with subscriptions allows you to focus on value on outcomes. And I think that’s how I would start doing would stop thinking about that one transaction and start thinking about that journey, which is what you do in marketing. That’s how we got them in the funnel. And then how do you move them into becoming a client? You have to continue that conversation.

Gyi Tsakalakis:

No, absolutely. And I think from the marketing people will talk about positioning and standing out. I mean, to me, this is the thing to help you stand out because now we talk about this all the time. People come to us at various stages of the process. A lot of people, they don’t even realize they’re even thinking lawyer yet. Maybe they’re doing research and lawyers come to the table with, we’re going to sell you a divorce. And it’s like, well, maybe I’m not even quite there yet, but I want some guidance. I want to know some options. And so I think that’s a big part. You talk about this too, but it’s like this unbundling of these services and maybe making that switch. And for me, it’s like a natural thing. It seems to me like there’s still very few lawyers that have made this jump, but that’s a huge competitive opportunity because if you’re in a market where everybody’s selling this one thing, the best way to stand out is to sell something completely different. Yeah,

Kim Bennett:

Agreed. I mean, I would say the number that we reference a lot is from Clio Trend’s report, and that’s from 2020. So the number then was about 8% of law firms that offered some form of a subscription. And we’re talking 2020 we’re talking.

Gyi Tsakalakis:

Yeah, that’s better than I would’ve guessed

Kim Bennett:

And that’s kind of like just as pandemic is hitting everyone, having to rethink how you’re talking about, and we’re not even talking AI even coming into the conversation, but if you use just that number, you’re talking just under a hundred thousand firms offering some type of subscription, and that is only increased. And you have so many powers that are impacting this. And so there are firms today that are doing it in some form or fashion, maybe not a fully complete subscription law firm. And I think that’s okay because it is a journey. You don’t have to go from one to the other, but it’s really recognizing that the billable hour is outdated. And now how do you present yourself to the market? One of our customers, he says all the time, it’s like he didn’t have a subscription before the subscription allowed for him to be a thought leader, allowed him to get more speaking engagements. It put him in front of his ideal customer, his ideal client. That then led to more business and a whole revenue stream that didn’t exist before. And so that’s the shift. It’s like, okay, I don’t have to go from zero to a hundred, but what small shifts can I do to bring this as a revenue stream? And then when you look at the numbers and you start actually putting data behind how subscriptions are recurring revenue work, you’ll see that it just makes sense, just pure economic sense.

Blaine Korte:

Yeah, and I think you brought up a great point about positioning and a great subscription has a tight ICP focus.

Gyi Tsakalakis:

Tell the listeners what ICP is

Blaine Korte:

Ideal Client profile, so who exactly is the customer, ideal customer for this subscription? Then the tighter you get that the easier it is to market, the easier it is to message. You’re positioning it for that one person in particular that really a lot of doors unlock when you do that, and we see that same success kind of map over to the subscription side.

Gyi Tsakalakis:

Nice. So this is one of those, it depends questions, but we’ve got some experts here, so I just want to get your thoughts on it. I’m not looking for a final solution, but you might feel passionately about it. Pricing of subscriptions on the website in your ad creative, in your messaging, how do you think about how to start having the conversation about how to communicate pricing to the marketplace?

Kim Bennett:

So I do have kind of thoughts on that, and I think there are, I’m going to say two broad buckets. There’s kind of a middle gray bucket, but there’s either a subscription that’s kind of a low cost that’s meant to bring people in the door, and then you’re going to have some upsells behind that. And then you have the other side where it’s a higher cost, let’s say a four figure beyond, so under four figures, let’s call it that, lower cost above four figures or higher cost where you might start including more things. So the higher four figures you get are beyond. You’re going to include some more things in that, but I think you can start saying, who is the client I’m serving and where do their resources stand? One of the things that someone, so I practiced law for, I don’t know now, almost 17 years, and then I ran this model for almost 15 years, and the thing that I found was getting the data on your ICP or ideal client and for business clients for me, what’s the percentage of revenue that that client would spend on this thing?

Legal? Okay, how do I position what I do to say, well, here’s the spend and here maybe I might want to go beyond that and why? And then present it. So I think if we use data, then you could start saying, okay, where’s my client’s resources at? I think to detach it makes no sense. So understand where your client’s resources are and then you start saying, okay, am I going to have a subscription that’s going to be on a lower cost end? You could still generate a ton of money that might be under a thousand or a higher cost, four figures and beyond, but I think that’s how I would think about it. And then also, I’m a big fan of putting it out. No one likes to not know, I don’t know. I hate to go a website and search for your price. So the same thing happens with your clients, and that’s why they think legal sometimes is so unattainable. And so if you can start bringing that transparency and at least say, Hey, maybe this isn’t the right fit now, and here’s why you could still serve them in other ways on your marketing funnel until they’re ready. So

Gyi Tsakalakis:

That’s great. A lot of good insight there. The other thing that we hear a lot about is like, okay, so I want to do the subscription thing. I’m starting to get a sense of some of these concepts. Maybe I’m going to offer whether it’s a loss leader, I’m going to have different subscription level packages. How do you communicate the expectation set so that you’re at the right subscription level for the need? I sense that a lot of lawyers are like, this sounds great, but what prevents my client from trying to access me 24 hours a day and now my subscription, I’m spending more time delivering the service than what I would if I had done under a billable hour model.

Blaine Korte:

I think the biggest shift that moving to a new business model gives you is the permission to reframe how you’re delivering those services and what does that look like. So one of the things that I always recommend gets included in a subscription is unlimited 15 minute phone calls, which is kind of a shocker sometimes to look at and think about, well, somebody’s just going to fill out my whole calendar. But if you put the boundaries in place that it needs to be booked through a Calendly link so that you’re only giving the space for a certain time on your calendar and you put some boundaries around it and you say, this is a great way for us to keep touch. And again, you put the boundaries around it, this has to be used in this certain way, and then you’re starting to flip the expectations and now your client can come to you sooner with needs. Maybe that turns into an upsell opportunity. But by really taking that kind of shifted approach to how you’re designing that package opens all of these doors, and it’s really about just taking that step back, thinking about the client journey, thinking about how you can best help them and what that new offering can look like.

Gyi Tsakalakis:

Love it. Another question for you, again, I’m just thinking about listener who’s like, this is making a lot of sense to me. I hate the billable hour. I want to make this switch. And then also for the lawyers that are already on subscription, what are some of the recommendations you’re making from a marketing standpoint? Is this a content marketing? You get it out there short form video content. What are some of the things you’ve seen work for subscription lawyers? If it’s any different than maybe a billable lawyer?

Kim Bennett:

So if you want to do one thing right now and you’re thinking about it, just start pitching people. You don’t even need the subscription. Talk about it to your potential clients who you think might be great for it and see what they say. Get their feedback. You don’t have to go from zero to a hundred, but if you start talking about it, you’ll start hearing people say, oh, well, this is what I would want and this is what I wouldn’t want. And so inside of the platform, we have a framework for customers to use to start packaging that subscription and processing out what that would look like. And then you iterate from there. And I would say even with loss leaders, back to what we were saying before, I don’t think a subscription should be a loss leader, not a service-based one. If you are product-based different, but if you’re putting your energy into it, no, make it profitable from day one.

Is it sustainable? Maybe not. Maybe you can’t get to sustainability yet because you need so many people on your subscription, but every subscription should build on profitability at the beginning. So and then I would say in terms of marketing, what do I see? One? Yeah, this is a part of a business model. What we’re doing is bringing modernization and nuance and learning from other industries to bring subscriptions to legal, but that doesn’t take away some of the foundational pieces of marketing that exist, that play well in subscriptions. I think the positioning part you were talking about earlier, yeah, put that out there. Use video marketing short form videos I think are great. I also think because we’re an industry that believe that billable hour is the only way you need to educate them. No, that’s not the only way, and let me show you how and talk to it. So I think blog content, because there’s still so few of us, jump on SEO because you’re going to be able to rank much better. But I think using traditional marketing methodologies to bring people down is important. And I think the thing that makes it different with traditional law is that a subscription talks about really, really focuses an ideal client, and you do that at the subscription design, which means your marketing is a lot better.

Gyi Tsakalakis:

Love it. Thanks again so much to Kim and Blaine for taking time to sit down with me. You can check out Fidu at fidulegal.com. They offer a demo every Wednesday. If you’re interested in checking them out, you can also send them a message at [email protected]. Thank you all for tuning into this bonus episode of Lunch Hour Legal Marketing. As always, Conrad, and I would love to hear from you if you have feedback. Willing to leave a review or chat with us on all the socials. Until next time, Lunch Hour Legal Marketing, we’re out of here.

Speaker 1:

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