Improvements in Legal Revenue For 2017, the American Bar Association (ABA) reported a 1.6% increase in the total number of “resident active” attorneys in the US, or 1,335,963. This compared to a 1.1% increase during 2016, 1.5% increase during 2015 and 1.1% increase during 2014. Data from The American Lawyer and Citi Private Bank reveal that the 2017 demand for legal services increased from a 0.1% growth rate during 2016 to a 0.7% growth rate, thanks to a specific increase during the fourth quarter. Net income increased 4.5% during 2017. In addition to higher demand, billing rates increased revenues 4.5% compared to a 3.8% increase for 2016. A large inventory of in-progress cases at the end of 2017 bodes well for Q1 2018 results.

Lawyer Productivity Clio’s Legal Trends Report 2017 showed that during 2016 attorneys logged 2.3 hours of billable time per day, an increase from 2.2 for 2015. The remainder of their workday was spent on business development (33%) and administrative tasks (48%). More than two-thirds (68%) of lawyers say there are not enough hours in a day and 28% say they struggle to keep track of tasks and deadlines. One contributing factor is interruptions; 25% are interrupted more than 10 times a day and 30% 6– 10 times a day. Many practice areas have seasonal fluctuation. For example, insurance cases increase at the end of the year, tax at the beginning of the year. Real estate, civil litigation and criminal cases decline during February. August and October are good for most cases.

Hunting for New Clients When asked what they would do if they had more time, 41% of law firms said they would spend the extra time looking for clients. More than half, or 54%, of law firms actively advertise to find new clients, but 91% are unable to calculate an ROI of their advertising. Almost all (94%) do not know how much it costs to acquire a new client. Of the firms that know the ROI of their advertising expenditure, 64% expect a return of 200–300% of what they spend.

What Clients Want The most important factor when hiring an attorney is their prompt response to calls and emails, 67%; followed by offering a free initial consultation, 64%; offering fixed fees, 47%; accepting credit cards, 28%; and communicating by text, 27%. In addition to these factors, Millennials also would like their lawyers to use document-sharing technology (30% compared to 23% of all Americans) and accept online payments (18% of Millennials compared to 11% of all Americans). Although clients like flat fees, this compensation structure is more common in certain practice areas, specifically traffic, 90%; immigration, 72%; and criminal, 59%. For all practice areas, 84% of cases are charged by billable hours.

Law Practice Insights Law firm operating expenses increased 3.1% during 2017, more than the 1.9% increase for 2016, due to expense pressures for infrastructure, marketing/business development and additional insurance premiums, especially relating to cybersecurity. Smaller firms, including Am Law 1–50 and niche/boutique firms outperformed other segments with a 1.7% demand growth and had the largest increases in year-end case inventory, or 8%. One-third of chief legal counsels (CLOs) say they will send more work to law firms during 2018, 47% the same and 17% fewer. That said, 33% report firing outside counsels for failing to satisfy their expectations during 2017.

Future Directions More general counsels are keeping business for their in-house law departments rather than outsourcing it to firms, creating price pressure. To survive, firms must shift to delegating to lower-cost lawyers or non-lawyers, boost efficiency and provide better service. According to the Legal Institute for Forward Thinking, firms that have deep knowledge of sub- specialties will thrive, particularly in areas relating to technology. More general legal needs, such as contracts, are being farmed to non-lawyers and legal Websites. Corporate law firms will find themselves less in the traditional role of a trusted advisor and more in the role of a strategic supplier; and general counsels will increasingly evaluate firms on quality, efficiency and value metrics.

Advertising Strategies With an expectation that there will be more interest in the summer TV broadcasts of “country club” sports (golf and tennis), some legal firms that specialize in corporate law may find it advantageous to promote their brands during these programs. Many law firms obviously require the assistance of an advertising/media expert to help them calculate the ROI of their advertising, creating an opportunity for you to become their trusted advisor. Because consumers/individuals consider a free initial consultation as the second most important factor when hiring an attorney, this can be a powerful call-to-action in their advertising and accurate means to judge ROI lead generation.

New Media Strategies You may be able to gain trust with a law firm, especially a new attorney, by recommending the use of ads on your station’s Website or paid content the firm or attorney authors to provide consumers with important information about hiring an attorney. Use knowledge management systems and preventative law software to improve efficiency and provide superior service. Regularly send corporate clients detailed updates of their legal budgets, so they can manage their spending, and electronic reports of the firm’s finished and yet-to-be-completed work on the client’s behalf.