The data you glean from your referrals and referral sources is the key to increasing your referrals and growing your law firm.
Do you know who referred you the most potential new clients over the past year or two?
Do you know who referred you the most potential new clients over the past year or two who became actual clients?
Do you know who referred you the most potential new clients over the past year or two who happen to be your ideal clients (in terms of the kinds of legal issues they’re facing or the industry they’re in)?
Do you know who referred you your most profitable client matters over the past year or two?
Do you know how often you or a colleague engaged with these referral sources over the past year or two?
Do you know which means of communication you or a colleague used to engage these referral sources, such as email, phone call, video call, or face-to-face (when possible)?
Strike that. You NEED to.
Your referrals are telling you a story. You listening to that story and acting on it, or you choosing to ignore it, is the difference between your referrals staying stagnant year over year and growing year over year.
You might be thinking, “So what kind of story are my referrals telling me?”
They’re telling you who your strongest referral sources are, and who your weakest referral sources are.
They’re telling you which referral sources you and your colleagues need to engage more, and which ones you can engage less.
To be clear, I am referring to three separate but related tasks:
(1) Knowing the story (i.e., Compiling data about your referral sources, including the prospective and actual clients they’ve sent you and how often you interact with them);
(2) Listening to the story (i.e., Understanding the patterns that emerge from the data); and
(3) Taking action (i.e., Developing your referral outreach strategy based on those patterns).
I’ll give you an example. Let’s say you and some colleagues have taken the time to compile data about your referral sources.
(How you are tracking which matters come into your firm via referrals is beyond the scope of this post. But I hope you are using a system that yields reliable data.)
You learn the following from the data:
– Sheryl refers you three prospective clients each year. You’ve known Sheryl for about four years, meeting at a conference. Typically, one of those prospects will become a client, but twice two of them did. Those clients’ matters are frequently among the most profitable matters for your firm each year. You only speak to Sheryl on a quarterly basis via email.
– Jon refers you about 10 to 12 prospective clients each year. You and Jon have known each other for a decade, dating back to when you were both associates at the same firm. Typically, about two of those prospects become clients. Those clients’ matters tend to fall in the lower 33% of your firm’s most profitable matters. Pre-COVID-19, you grabbed lunch with Jon at least once a month.
– Alycia sent you one prospective client in the five months since you were introduced to each other by a mutual professional acquaintance. You were hoping for more referrals because Alycia provides a non-legal service to your ideal clients. That sole prospective client did not pan out. You met Alycia for a socially distant outdoor coffee in late 2020, but do not speak with her on a regular basis.
What is this data telling you?
How should this data change your outreach strategy to these three referral sources?
Well, if you wanted to strategically and intentionally act upon this data, you would engage Sheryl and Alycia more, and dial back your monthly lunches with Jon.
Sheryl and Alycia seem to be in a position to send you prospective clients who have the kinds of cases you want to bring into your firm.
Jon, on the other hand, sends you cases — but not great ones. Given your relationship, you can reduce the number of your monthly lunches without impacting the number of prospective clients he will send you.
Now, repeat this exercise with each and every one of your firm’s referral sources.
Though I shouldn’t be, I’m often surprised when I talk to clients and friends about analyzing their incoming referrals. They often act like doing so would require them to do the impossible. It won’t.
You might be feeling the same way. Don’t.
Yes, it will likely take you and your colleagues some time to determine the story your referrals are telling you.
But what you and your firm stand to gain from listening to that story and taking action based on it makes the time you spend on this endeavor among the most valuable time you are going to spend this year on your firm’s marketing and business development efforts.
Listen to the story your referrals are telling you.
When you do, a path forward will reveal itself for engaging your referral sources in a way that could lead to them sending you more prospective clients tomorrow than they do today.
Bottom line: The data you glean from your referrals and referral sources is the key to increasing your referrals and growing your law firm.