Are Pricing Directors Necessary for Law Firms?
A few weeks back, we carried an article titled What Law Firms and In-house Counsel Are Doing in Online Marketing where we mentioned how law firms are getting ahead in online marketing, and in April, we did another piece titled Are the Days of the Rainmakers Over? In which we mentioned that according to a recent survey, almost 90 percent of small and mid-sized law firms surveyed had at least one staff member dedicated solely to marketing and business development. So it came as little surprise when Washington Post did an article last week claiming At law firms, pricing managers are in demand.
This has suddenly stirred up the issue of pricing managers and pricing directors at law firms over the internet, and it seems many have started to realize that law firm marketing has come of age, and relationship marketing is no more sufficient without being backed by experts.
Pricing has remained one of the biggest issues of marketing and is as much important and promotion as place. Traditionally, law firms have not faced great issues with pricing, but with technological advancements and law firm business dynamics changing its landscape almost overnight, thinking and functioning like corporate organizations has become essential.
In this light, Washington Post's article is of great significance, because they have interviewed Matt Laws, who they say, "is not a lawyer, but he spends his days thinking about how lawyers charge their clients." With law firms hard pressed to sustain client relationships and corporates demanding more transparent and alternate fee structures, pricing managers are gaining relevance for law firms that need to sustain and acquire client relationships. Big clients and their in-house counsel are continually pressing law firms to optimize, but while they are trying to oblige, wrong pricing is leading to unsustainable relationships in many cases.
Alternative fee arrangements can be securely done only by marketing people, or specifically pricing managers in the legal industry who are aware of the costs of processes and also where it costs what to get things done. For example, as Washington Post says about Matt Laws, "He knows … how much it costs to interview 10 witnesses … He knows that a federal lawsuit filed in the Eastern District of Virginia … will probably take three quarters of the time it would take … through another court."
Matt Laws is currently the director of client services and pricing at Crowell & Moring, but he is hardly the only such professional in the industry. In 2011, Toby Brown, the chief practice officer at Akin Gump, who is also in charge of pricing and project management, founded a group of similar professionals who are engaged in pricing management at law firms. The group named P3, which initially grew from five to 300 people, has now become part of the larger trade group Legal Marketing Association.
And their phenomenal growth shows that while the days of the Rainmakers may not be over, the law firm industry has woken up to the fact that they need marketing professionals dedicated to pricing management more than ever.
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