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ROI on law firm marketing expenditure still elusive, study finds

22 May 2017

Latest research finds that Marketing & Business Development (BD) Directors and CMOs at the world’s leading law firms are not confident that they can demonstrate a return on their firms’ investment in marketing and BD.

The 2017 Law Firm Marketing Operations Index, conducted by consulting firms Totum Partners and Calibrate Legal, surveyed marketing leaders, including Marketing and BD Directors and CMOs, at the largest law firms in the UK, United States and Canada.

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The 2017 Law Firm Marketing Operations Index, conducted by consulting firms Totum Partners and Calibrate Legal, surveyed marketing leaders, including Marketing and BD Directors and CMOs, at the largest law firms in the UK, United States and Canada.

The 68 participants were asked to rate their firms’ performance in seven categories of leading business practices demonstrated by the highest-performing marketing/BD organisations across all sectors, including:


1. Business Alignment and Accountability
2. Marketing Performance Management
3. Marketing Data
4. Business Processes
5. Revenue Enablement
6. Systems and Technology
7. Talent and Knowledge


‘The findings show that law firm marketing leaders are generally confident that their teams are well aligned to the business needs of their firms,’ says Tim Skipper, Managing Director at Totum Partners. ‘But they do not believe they are effective in measuring the performance of their marketing/BD function. Nor do they seem to think this is critical, even though this is a priority across other sectors.’


‘CMOs are not confident that their firms meet best-in-class standards for the operation of a Marketing/BD department,’ adds Jennifer Scalzi, founder and CEO of Calibrate Legal. ‘This points to a viable area of opportunity in an industry that is particularly hungry for competitive advantage.’


Of the seven categories of Marketing Operations proficiency covered by the survey, Marketing Performance Management stood out as an area for attention. Marketing and BD leaders rated their organisations low on ability to measure the performance and business contribution of their organisations – particularly on the critical metric of Return on Marketing Investment (ROMI), which is widely used in other industries to allocate marketing spend.


‘Our research shows that CMOs understand the value of measuring return on marketing investment, but are not institutionalising that measurement,’ Scalzi says. ‘Those that can confidently capture the performance of their marketing programmes will be well positioned to achieve sustainable revenue growth.’


Reinforcing this issue are the study’s findings on Marketing Data in law firms. Respondents appear to agree that improving marketing data – including quality, access, and capability – needs to be a priority for their teams. In particular, they believe that their firms need to focus on Customer Relationship Management (CRM) data, including information on the firm’s clients and lawyers’ interactions with them.


‘The ability to measure marketing’s contribution starts with reliable marketing data,’ says Skipper. ‘We believe Marketing & BD Directors need to look at data & analytics as a core marketing competency, and set expectations around this competency for their teams.’


The research also identified Revenue Enablement (the degree of alignment between marketing and sales activity) as a problem area. The responding Marketing & BD Directors/CMOs reported high performance scores on the tactical elements of revenue enablement, such as creating and maintaining sales collateral and marketing materials.

However, they are much less confident that their teams are strategically aligned. For example, few respondents report that marketing supports a standard BD process, has internal accountability for the firm’s revenue pipeline, or is measured by contribution to revenue.


Other findings in the joint research project included:
• Marketing/BD leaders report excellent working relationships with their IT Directors/CIOs and IT organisations – a positive sign for the future of marketing technology at law firms.
• Lack of integration among law firms’ various marketing technologies remains a critical pain point for Marketing & BD Directors/CMOs.
• Few of the respondents report that they track the satisfaction of their internal clients (lawyers and business developers) with marketing & BD’s services.


‘Our research makes it clear that law firms have not fully embraced the principles of Marketing Operations: increasing marketing efficiency and organisational agility; aligning marketing activity with revenue growth, and measuring activity and people in a systematic way,’ says Scalzi. ‘There is some very rewarding work ahead for the firms willing to lead the charge.’
‘As in other industries, the business leaders that marketers serve are motivated to wring the greatest possible value out of the firm’s marketing expenditure,’ concludes Skipper. ‘If law firm marketers can’t prove that value over time, the Marketing/BD budget will inevitably be reduced or restructured.’
Click here to download the Executive Summary.

About the Research


Field research for the 2017 Law Firm Marketing Operations Index was completed during March 2017.  A 110-question survey was distributed by email to 280 of the largest law firms in the UK, United States and Canada. All recipients were Marketing & BD Directors, Chief Marketing Officers (CMO) or equivalent senior Marketing/BD executives. Responses were limited to one per firm; respondents were given assurance of confidentiality for their individual results. 
Sixty-eight questionnaires were completed and returned, giving a satisfactory response rate of 24% of the survey population. Mean survey completion time was 23 minutes. Respondents included 22% of the world’s top 50 law firms. The responding firms had an average complement of 793 lawyers, and an average of 36 Marketing/BD professionals.


About Marketing Operations
The rapidly growing discipline of Marketing Operations seeks to increase marketing efficiency and organisational agility, and to measure, in a continuous and systematic way, how the marketing function helps businesses grow revenue.
Marketing Operations arose more than two decades ago in the technology and consumer goods sectors. Initially, law firms were slow adopters, but today, leading firms are establishing dedicated Marketing Operations functions, led by highly qualified senior professionals in a bid to measure and manage the ROI on their marketing and business development (BD) expenditures.

About the Sponsors


www.totumpartners.com
Our vision is to be the first port of call for business services recruitment for leading law firms. Clients choose us because we move with the market, understand the legal sector better than anyone else and attract the best talent from inside and outside the profession.
Our long background in legal recruitment gives us the ability to support all sizes of law firms in all parts of the world to create and develop highly effective management teams that drive sustained business growth.
At Totum, we live and breathe law firm management. Nothing is more important to us than sourcing the right and the best management talent to meet the specific needs of every law firm we work with. But it is the way that we work that consistently delivers success.
 
www.calibrate-legal.com
Our mission is to connect the right people, ideas and information to position our law firm clients at the forefront of the next era of the legal industry.
We partner with our law firm clients to help capture and articulate the value of their human capital investments, and to advance the dialogue between law firm leadership and the Revenue Enablers™ who are critical to advancing their strategies.
We are committed to helping law firms position themselves at the forefront of the legal industry’s evolution by placing sophisticated talent, leveraging firm leadership and building cultures driven by meaningful data.

Information for Media
To obtain a copy of the complete study, contact:
Brooke McClure
Team Co-ordinator
Totum Partners
brooke.mcclure@totumpartners.com

 

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