During inflationary times, law firms are faced with increasing prices to uphold service value. Following inflation, you’ll look to review your client agreements, and possibly make changes – although not overnight. In an inflation scenario, to uphold your client relationship and protect your brand, you will need to skilfully communicate these changes to your clients.
Executing a price increase is not something you can roll out immediately, it requires good marketing and communication. If your law firm’s branding and marketing is working, your clients will trust you, which you need during times of change. Your law firm’s marketing and branding should promote your value to clients, and put your law firm top of mind as a valuable investment.
How to manage a law firm pricing change
To plan how you will roll out a price increase, start by checking your agreements with clients. If you haven’t changed your agreement with your clients for some time, know that you are not alone.
Many lawyers never revisit their costing agreements and rely on the same agreements for years. But this doesn’t have to be the case.
Your firm can have costing agreements that automatically increase your prices over the years, without you having to get permission or give notification each time. Lawyers can set up agreements to automatically allow for incremental increases. For example, every 12 months, fees will increase by 5%. To get the right advice on this, we recommend you hire an expert in legal costing to provide direction.
If you do not have incremental increases in your current client agreements, we have the following advice when planning your marketing and communications approach during times of change.
Increasing your law firm’s pricing
With inflation dominating the news, your clients are likely aware of the impact of inflation. Inflation is both an advantage and disadvantage to your law firm; while your client won’t be surprised about a price increase, they will likely receive it as an added challenge to their budget. If your firm has delivered on what was promised and has developed a strong brand, then most clients will accept the price increase with little pushback.
Effective marketing during this period is a delicate balance to ensure ongoing client relationships while protecting your livelihood and respecting the value of your services. Before communicating out to your clients, consider your law firm, and ask:
- What is our justification for raising our law firm’s prices?
Reiterate in your marketing messages that you want to continue upholding your quality of services during this difficult economic time in order to best serve your clients.
- Can we contact our clients directly?
Do you have the kind of relationship where a phone call and a personal email or letter advising of your law firm’s price increases will ensure your brand is protected?
- Can we let our clients know in advance?
Your clients deserve the chance to review if they can continue with you, which also supports your business continuity.
- Are all our lawyers and staff aware?
Ensure everyone in the law firm is in sync to begin the conversation with clients. You do not want mixed messages in your team or out to clients.
- Can our clients easily contact us?
Whether it is by phone, email, or through your website or social media page, ensure that any enquiries about your pricing change are responded to in a timely fashion.
Preparing your clients for a price rise takes planning, good marketing, and solid branding. If you need help preparing your website and marketing strategy in preparation for your law firm’s price increases, contact us for help.
About the author
Peter Heazlewood is a management and marketing consultant, he specialises in helping law firms develop their practices using business planning marketing and performance reporting techniques refined in his own successful law firm. Peter lives in Sydney with his wife and is the father of five adult children.