Kerrie Fuller outlines the Law Society's value proposition project and explains how law firms can get started with their own project, to understand and deliver what their clients want from them.
The Law Society is currently undertaking a value proposition project to help us understand how we can add real value to our members’ working lives, through our membership offer. The findings from this project will help us to understand how we can both allocate our resources and maximise our assets, in order to provide the best possible value for our members.
Law firms, too, face the challenge of understanding what their customers want from them. Below is a brief nine-step guide to getting started with your own value proposition project in your firm.
1. Segment your clients
Different clients will value different things. They can also be grouped in different ways. Think about the stages of their lives or of their business’ maturity. Are they regular clients or just one-off customers? What are their demographics, culture, personal characteristics, capabilities, attitude to risk, payment preferences, buying criteria? What areas of law might they need support with? Segmenting your client base will helps create a clearer idea of each segment’s particular needs.
2. Define their financial value to your firm
How much financial value / income does each segment contribute to your business? Which segment(s) provides the majority of your income? This will help you prioritise how to your resources, and evaluate return on investment at a later stage – see step 9.
3. Find out what each segment really values
Consult each segment. What do they really want from their interactions with you? There will be some common answers: excellent customer service, quick response, little jargon, transparent fees. By doing this exercise with each segment, you will gain an understanding of the similarities across segments (they all want excellent customer service!) and those that have specific needs.
4. Match the values with the current offer and identify gaps
What do you already do that the segment values? Do they know that you do it? Communicate this effectively to your client base.
What segment needs are you not currently meeting, but could? Perhaps clients within a segment would value a glossary document, to help them better understand the relevant legal terminology. Or do you do something for another segment of your audience which you could roll out more widely to fill a gap? For example, if you already offer an online chat facility to international clients, can you also offer this to UK clients that have trouble accessing your offices?
5. Communicate value to potential clients
If you identify a potential client, allocate them to a segment so you can anticipate what they would most value from you. Then communicate that element of value to those clients. If they prioritise speed, highlight your two-hour response time; if they care more about price and ease of access to your services, tell them about your free initial consultation via Skype.
6. Improve your systems and processes
Improvements to systems and processes really add value. Could you respond via email, allow clients to log-in online to access documents, and/or automate stages in an admin process? All these activities add value by reducing time and effort.
7. Exploit your assets
Part of any value proposition project also looks at how to maximise existing assets to increase income. A typical example is renting out rooms in a building, or offering staff expertise to external bodies as consultants. List your assets and look at ways to maximise their income.
8. Prioritise your resources
Before committing to new activities that will add value, look at the cost of producing that value. An individual key account manager may add value, but will be expensive. Will this cost be returned in income? Use the income profiles created in step two to weigh the costs against the income for that segment. If you are unlikely to recoup the cost, don't introduce the benefit.
9. Don’t rest on your laurels
Segments and their needs change over time. Consult with key segments regularly to keep up to date about their needs, so you can adapt your proposition accordingly.