Lawyer tells me she needs more business. She’s upset that she spent all these years in law school, then more years learning her craft, plus she spent a bunch of money breaking away from a firm to open her own office.
The clients aren’t coming, and she’s agitated.
Her marketing strategy in her small town was to undercut the price of the other lawyers and deliver excellent service and advice. She’s got the experience, and she really does know what she’s doing. Offering her services at a very competitive price seemed like a no-brainer to her.
Unfortunately, it’s not working. She’s cheap, but she’s not busy.
To add insult to injury, when she does get a client, she’s charging less than everyone else and is therefore earning even less than anyone else.
Why isn’t cheap working for her?
Problem one is the math problem. Working at a low price doesn’t generate much revenue on a case-by-case basis. Cheap works if you can sell volume, do it efficiently, and carefully manage your costs: think Walmart. Odds are that you aren’t nearly as efficient as Walmart. If cheap doesn’t work, then you’re leaving money on the table with every case you take.
Problem two is the image issue. Some people—especially people in crisis—equate quality with price. They assume the higher price means a higher quality of service. That’s especially true when we’re facing a high stakes purchase. Cheap sometimes feels risky. When it’s important, we’re particularly risk averse. Would you pick the cheap cancer doctor because you could save a few bucks?
Problem three is the lack of price shopping for most legal services. Many of us believe that we get calls from price shoppers all day long, and we think prospective clients are extremely price sensitive. The fact is that those callers aren’t really calling about price. We’re being overly literal when we answer their questions by talking about money. When prospects ask about price, they’re really saying “tell me about your service.” They want to determine whether you’re the right choice for them, and the only thing they know to ask is price. When you answer the price question with a number, you make it clear that you aren’t interested in listening and understanding their situation. They quickly decide that you aren’t worth the money, no matter what the price.
There are lots of lawyers undercutting other lawyers on price. The cheap lawyers, by and large, aren’t packing up money in suitcases and hauling it to the bank. They’re cheap, but they aren’t busy.