Success is all about planning — it includes having a vision for where you want your law firm to be in the future and then creating a plan that makes that vision a reality. Around August of each year we start conversations with member law firms about planning for the coming year. The following includes a few of my notes from our November Practice Building Call for members where we reviewed how to set revenue goals and calculate a marketing budget. The recording of the call will be posted on the Member Only website next week. All the forms discussed below, in addition to our new Marketing Budget Worksheet, are all available now for downloading from the site!

This planning is typically a 5-step process. Here’s a quick breakdown of the system, which you can start to incorporate for 2013.

 1.      Set Your Gross Revenue Goal

Start by reviewing your year-to-date revenue. Then look back at your annual Profit & Loss Summary for each of the last few years to determine your average growth rate from one year to the next. What’s your growth capacity for the coming year? Don’t be afraid to push yourself and your firm out of its comfort zone to grow the practice. What is really possible for your firm and staff? Perhaps you’ve added a new practice area, such as Medicaid planning, and will start to see that pay off in the new year or you’ve hired new staff and are now able to take on more work than you have in the past. Also, keep in mind efforts that allow you to work smarter and not harder which can increase your revenue for the year. Increasing your fees is a good example.

2.      What’s Your Body Count?

Now that you’ve set your Gross Revenue Goal, determine what your goal is for each revenue stream. You’ll want to be detailed about exactly how much revenue you plan to have in each category, for example Amendments and Restatements for existing clients, Living Trusts, Trust Administration and Medicaid Pre-planning. This will allow you to calculate the number of people the attorney should speak with every month to achieve those revenue goals per revenue category. We call this the body count and Academy members have access to a Body Count Cheat Sheet that helps them calculate those numbers. The majority of members end up with a Client Body Count and a Prospective Client Body Count.

 3.      Identify Your Marketing Activities

With your revenue goals and body count in hand, you’ll next identify the marketing activities that support your goals and get the attorney in front of the right number of prospective clients each month. Academy members have access to a 5-page Marketing Activities Checklist that allows them to consider all of their seminar and non-seminar marketing options.

 4.      Set a Marketing Budget for the Year

When we review law firm financials every year for our financial database, we use 10-15% of Gross Revenue as the benchmark for marketing expenses. When creating your Marketing Budget for the new year, you’ll want to base it on your total gross revenue goal and not your current revenue. The first step is to set an actual dollar amount that you’re comfortable with and that is within the range of 10-15% of the goal. Next you’ll identify all of your non-public seminar marketing expenses. You can do this by reviewing the list of marketing activities you’re planning on for the year from step 3 above. This should be a comprehensive and thorough list of expenses, that includes everything from Website and Online Marketing Efforts to Client Marketing to contributions towards Endorsed Seminars to any Networking. Once you have an estimated total for non-public seminar marketing expenses, you can subtract that from your total budget and determine how much you have left over for public seminars in the new year. Add up all of your advertising costs, followed by other expenses so you can determine what each public seminar will cost you. You may end up with a different total for newspaper advertising than direct mail costs if you market public seminars using both mediums. Next, determine how many public seminars you can afford to have in the new year.

 5.      Creating a Marketing Planning Calendar

Now you’re ready to put your plan on paper and create a roadmap that will help you accomplish your goals and vision for the coming year. Academy members have access to a Marketing Planning Calendar template that they can customize for their firm. The first step is to identify which months you’ll be having your public seminars. This should be based on tracking data that shows you which months are most profitable for public seminars from your previous efforts. Then create a plan for the other months of the year that incorporate your marketing activities from step 3 and will allow you to hit your monthly body count. Don’t forget to track your new efforts so you can analyze your results in order to repeat the activities which are most successful and revise your plan if needed for future months in the year.

Lillian Valdez
Practice Building Consultant
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (800) 846-1555
www.aaepa.com