One truism in any economic downturn is that marketers will unfurl the union banner which reads “Good companies grow share by expanding marketing while others cut.” Another truism is that business leaders, when faced with an economic slowdown, will often apply the cost-cutting scythe to all departments in the interest of fairness, suggesting that every department should bear its proportionate share of the burden. You may note that these approaches are mutually exclusive. Both can’t possibly be right. However, both approaches, if interpreted or executed incorrectly, can be dead wrong.
Of course there is truth to the historical notion that when some companies hunker down and cut costs, others spend more to fill the ensuing vacuum, raising visibility and name recognition. But this doesn’t mean that whatever you spent last year on Marketing should be the same or more this year.
The more critical analysis is how you invest in Marketing, not how much you spend.
I’m writing this as I travel to the Legal Marketing Association’s annual conference where for the next several days I will hear (and deliver) commentary to legal marketers, and any number of fantastic ideas will be proffered. The ever-present challenge in the legal marketing arena is not a paucity of good ideas; it’s an inability to execute these ideas.
I engaged in an interesting dialog with a large law firm partner, who was typically harried, intense and exceedingly bright. He described his marketing needs as simple: “We need someone to track all of our completed deals so they can be searched by client, region and type. Then the marketer needs to be able to quickly pull this info and plug it into an RFP template to send to the client.” My first reaction was that he didn’t need a marketer at all; all he needed was an Excel spreadsheet that his secretary could maintain. After a bit more analysis, I learned that the partner and others in his practice had a dismal win rate on RFPs, in part because they didn’t understand that strong relationships with clients can often win work without an RFP.
A veteran partner at another firm, a bit long in the tooth and primarily a service partner, lamented that he was not comfortable “working a room” in the same manner as his successful rainmaking partners did with ease, so he preferred to sponsor client events such as the cocktail reception at an industry annual convention. He deserves credit for spending time in the client’s backyard. But when he described the benefits derived from his sponsorship (essentially the firm logo on the cocktail napkins and a polite podium mention from the association president) it was clear there was very little value obtained for the significant investment.
I engaged in a dialog with a bright, energetic young partner in a mid-size firm who was eager to learn rainmaking skills. “We’ve arranged an introductory meeting with a manufacturer across town, but we need to know how many partners to invite in order to fully present our capabilities.” The intended approach was to present several of the firm’s practices to a polite audience of in-house counsel, in the hopes that this would win work.
Some lawyers reading the above anecdotes will recognize these recurring challenges and wonder why I find fault. In fact, some marketers who have learned their craft in traditional law firm settings will ask the same. But savvy marketers will attack:
“In the first example, the partner should focus on identifying, establishing and growing key client relationships, and rely on RFPs only as a last resort. A well-oiled machine that efficiently plays your 78-rpm phonograph records in an MP3 world is still a waste of time.”
Others will declare:
“Eliminate all sponsorships that don’t provide a public speaking opportunity, and if you get stage fright then bring a colleague who doesn’t.”
Finally, some will advise:
“When you first meet with a potential client, your objective is to learn their business and not to promote yourself and your capabilities. How could you possibly know what challenges they face if you don’t ask?”
Marketing carries so many different meanings. For lawyers who have enjoyed the luxury of a generation of near unlimited demand for legal services, Marketing is nearly synonymous with high-end administrative support. It’s event planning, brochure writing and writing elegant prose about how wonderful we are. For the rest of the business community, Marketing is about identifying optimal target markets, taking steps to increase visibility and demonstrating expertise in these markets, understanding client concerns and then developing and offering solutions to address these concerns.
When the expense reduction committee turns its attention to Marketing department, I suggest it’s less impactful in the long run to view Marketing as a collection of fixed and variable expenses and people comprising a cost center. Focus instead on what the firm is doing to articulate its strategy, pursue clients and prospects, enter new markets, replicate financially successful engagements, improve inefficient operations and thus elevate the service posture, and protect and defend its key client relationships. If the red pen you wield in the budget discussion doesn’t directly improve any of these metrics, then what’s the point? You can continue to reduce expenses across the board without regard to what generates revenue, but this won’t buy enough time until client demand returns to previous levels. That train has left the station. Don't cut "marketing expenses." Rather, cut the wasteful expenditures and activities which have little impact in generating new revenue.
What’s needed right now, more than ever, isn’t an expense reduction committee. It’s a revenue generation committee. It should be the first firm-wide committee. All hands on deck. And for those who are too busy or disinterested to participate, you can still put your red pen to use by circling your name as an ineffective investment.