With the emergence of online shopping has come the advent of online savings codes. In fact, in the UK, nearly 10 million consumers used an online savings code in the past year, according to Nielsen and This Is Money.
A myriad start-up websites, like Groupon, have also cropped up to show us the way toward increased savings. These websites offer vouchers and coupons for cheaper services and products to consumers, while making money in affiliate marketing schemes on the side.
It seems nothing is full-price anymore. Except, perhaps, law services.
Discounting within the field of law is, for some reason, frowned upon.
There’s no “black Friday” for attorneys fees or coupons for half-price on your next court case.
Lawyers are concerned that price equals value—that clients will believe the quality of services rendered were as low as the bill for them. Lawyers are also concerned that clients will become accustomed discounting and will eventually refuse to pay full-price for attorney’s fees or choose alternative representation in the event these fees rise.
As a result, discounting is strategy for attracting new clients or retaining old ones in a competitive market. In the recession, with an overabundance of attorneys, this type of corporate strategy of price differentiation was key.
Luckily for lawyers, however, times are looking up and fees are going up with them.
“The end of 2012 saw increased optimism among law firm managing partners, whose renewed faith in the overall economy mirrored gains in their confidence in business conditions for the legal profession,” The AmLaw Daily concludes from the latest Law Watch Managing Partner Confidence Index survey.
According to the survey, confidence in the broader economic, and particularly in business conditions for the legal profession, jumped 18 points in the last quarter of 2012. Although confidence in discounting rates was poor, an improvement in the demand for legal services will go a long way in abolishing this fee-reduction trend.
“A lot of the discounting pressure that we’ve seen over the course of a number of years now, postrecession, has been driven by the fact that there’s not enough legal work to go around,” explains Citi senior client adviser Gretta Rusanow to The AmLaw Daily.
“So, where firms have excess capacity, they are more inclined to discount their fees in an effort to keep their lawyers busy.”
Nevertheless, increased confidence in the market is a good sign for lawyers.
In the end, discounting won’t be necessary as long as your firm can offer clients:
1. Evidence of the value
Have a new client one-page summary sheet that lists your firm’s case wins, satisfied client testimonials, and the profiles of your qualified employees. Provide a short cost-benefit analysis that shows your fees are appropriate, as well as important to stave off the possibility of higher costs in the future.
2. Consistency in work product
Consistency equates to quality. Provide regular case matter updates, personal and electronic communication, and billing. Clients are less upset by invoices that they are already expecting.
Increased confidence about the market or the future of the field of law is good news on the whole. But, retaining confidence in the high quality of your practice will also help your firm retain its clients. Discounting is a legitimate corporate strategy. But, does your firm care more about its price than its value?
The economy is uncertain. But, with comprehensive and confident work on a client’s case, your performance doesn’t have to be. Discounting or no discounting, a law firm’s value and ability to attract clients is created by a rock-solid reputation, time-proven results, and high human capital—not simply the price tag.