Marketing the Target
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Nothing is simple, is it? Just as lawyers finally think they are getting the hang of this marketing lark, along comes someone with an even better idea on how to woo new clients.
The big marketing departments - such as Freshfields Bruckhaus Deringer with its 60 staff - have become accustomed to the luxury of having marketeers specialising in every practice area. But this is no longer enough - now they have to target industry sectors as well.
Instead of just selling an understanding of corporate issues or employment problems, the firms are being pushed to sell their understanding of clients' industries and to target things like aerospace finance and pharmaceuticals.
Kevin Wheeler at marketing and business development consultancy Wheeler Associates says: "Now clients are saying they want lawyers who can understand their sector. Given that a City firm is going to be good at corporate or good at employment, most firms can provide the same technical service, but not all of the major City practices would be deemed to be experts on telecoms, for example."
Some of the middle-tier firms have been doing this for a long time with much success. Firms have branded themselves as experts in certain sectors and have seen the work come rolling in. Examples include Masons in construction, Davenport Lyons in media and entertainment and Bird & Bird and Olswang in technology and communications.
For the bigger firms it is more of a challenge, but one that if done properly will reap rewards.
Eversheds director of business development Simon Slater says: "If you can package up services and convince one market that you can fill a broad remit, you'll benefit. If you can become a number one or two player in that industry, you'll be able to command a premium in terms of fees. There's no doubt about that whatsoever."
Eversheds has six such cross-practice teams in place, focusing on biosciences, local government, technology, media and telecommunications (TMTs), financial services, education and energy. The firm is in the early stages of developing a group to target transport and logistics, and is also looking closely at retail and leisure.
Clifford Chance is taking the same approach. Corporate business development manager Adrian Cooper says: "Many of our clients are powerhouses in their sectors - domestically and internationally. It's important for them that we're able to offer expertise in not just broad products, but in specialist sector expertise and in the jurisdictions that are important to them. In other words, it's important that we know their business and concerns inside out.
"Through creating industry-focused teams we can pool our knowledge internally, identify potential new revenue streams, whether targeting potential clients or cross-selling to existing clients, and anticipate and resolve conflicts."
So if you decide you are developing a particular strength in one industry, how do you go about marketing that? The first thing is to pull together a team of lawyers across the firm who work with clients in that sector. Identify who you already work for and then decide who to target for new assignments. That team can also share information to make sure the firm has a real understanding of the issues to market to potential clients.
Tony Reiss, the director of marketing consultancy Sherwood Consulting, says: "The trick here is for a law firm to have a bit more of an understanding of a sector than all the others do, and your client can always give you some insight. You can second people from your organisation to theirs, or clients can run seminars."
Wheeler adds: "It's a case of identifying which organisation you're trying to target for business and then which individuals. You then try to demonstrate that your firm is better than the firm they're using.
"The best thing is to start with your existing client base. I'm always surprised when I go into firms and they say they're trying to target X,Y and Z when they already have a great client base. One of the main challenges for law firms is to take their existing client base and try to cross sell - most law firms probably don't need to go out and generate new clients from scratch. If they just went out and targeted what they had, they'd probably be able to make good gains in terms of fees."
Not every sector is well placed for such an industry-focused approach, though. Slater at Eversheds says: "There are some industries that offer more opportunities than others, and they tend to be the ones that are globalising or consolidating very quickly. Whether a company is growing or declining, it always represents rich pickings for lawyers."
The chance of hitting a conflict situation is also larger in some industries than others. "The smaller the industry in terms of the numbers of players in it, the greater the chance of conflicts. If you decide that's a market for you, you'll have to take it on the chin that you won't act for everybody," says Slater.
The advantage of a more sector-based approach is that it is more easily suited to smaller firms with smaller marketing departments. City firm Macfarlanes has just five people in its marketing team, so dedicating someone to each practice area is out of the question.
Head of marketing at Macfarlanes Penny Rutterford says: "We have a relatively small team here, so it wouldn't be practical for us to organise things for practice areas. The benefit of our approach is that we're crossdepartmental, so we can take a firm overview for cross-selling and coordinating activities for clients whose services are cross-departmental."
But despite taking an overview, actual marketing initiatives are still frequently targeted along practice lines in the same way as the firm is organised
. And even global giants like Allen & Overy (A&O) are quite happily staying true to that traditional approach.
A member of the marketing department at A&O says: "I think it's very important that marketing staff absolutely get embedded into the practice groups and aren't in any way seen to be sitting in some sort of marketing ivory tower. The whole approach here is a tailored one. It's aimed at the particular sector and also understands and gets under the skin of what the practice does."
He says that cross-selling is promoted through coordination among the marketing team, so that the head of marketing is aware of opportunities arising out of relationships in other departments.
Slater describes the system at Eversheds as a matrix where a mixture of practice groups and industry groups combine, a halfway house model typical of most firms. He says: "In the smaller, more niche firms it's easier to put the sector first. In the larger law firms there's such a collective glue within practice groups that you really have to think twice before unravelling that in a separate way. If you can achieve an effective combination and create some sort of matrix where people are based in their practice groups, but also take an active role in an industry-focused marketing group, then it's possible to penetrate market sectors very effectively indeed. You just need a nimble matrix, and that needs to be managed."
The practice groups - which are after all the way lawyers are trained to think - continue to underpin the marketing plan.
Cooper at Clifford Chance says: "Our marketing and business development effort will increasingly be focused on particular industry sector groups, ensuring that our specialist sector knowledge is reflected and communicated to players in the marketplace.
"There remains a place for marketing our general core competencies in products like M&A or antitrust, but this will increasingly be seen as a backdrop with the marketing of industry sector skills overlaying it."
At the end of the day it is really all about working out who you want to sell to and how you are going to get to them. That involves sharing information on potential clients and then targeting your marketing.
Wheeler says: "The best route is always to try and target the decision-makers directly. Lawyers are very bad at getting out and selling. They've tended to waste their marketing pounds by trying to market at arms length, but there's no substitute for sitting down in front of a prospective client and telling them exactly what it is you can do for them. You've got to do something that demonstrates to the client that you know what you're talking about."
It is really all about setting yourself apart from the competition, and taking the time to gen up on one particular sector can be the easiest way of doing that. Choosing which one - and then getting partners from all the different departments to meet regularly and pool information - well... that might not be such a breeze.