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Product Development for Lawyers

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Editor’s Note:  I’m very excited to host this post by Eva Hibnick and Allen Rodriguez, co-founders of a law innovation agency, One 400, focusing on helping law firms build products, create inbound marketing channels and acquire clients. I realize that many lawyers don’t want to see legal work commoditized, but if that’s inevitable, I’d rather have lawyers than non-lawyers creating the charge. Also, “product development” which is the subject of this post needn’t be taken literally – the steps that Eva and Allen describe can be applied to any new law firm endeavor from exploring a new practice area to developing a better intake system to serve clients.

Companies spend a lot of time and money on developing new product lines and perfecting existing products. In business, product development is a fairly common term but not so common in relation to lawyers and legal services. For lawyers, the common practice is trading time for money. Clients are billed for the number of hours you spend on a given motion, brief or contract. However, by shifting your mindset and breaking from tradition you’ll find that offering your services much in the same way tangible products are offered will help you increase your client retention rate, decrease your sales cycle and increase your client satisfaction. The additional benefits offered by this method is a better more scalable process and increased revenue.

Legalzoom was one of the first recognized companies to productize legal services though many other non-attorney owned providers have been offering flat fee commoditized services since the 80’s. Using Legalzoom, consumers can purchase many do-it-yourself legal products without talking to an attorney.

We believe that lawyers can use the same methodology as Legalzoom and over their legal services as products. Lawyers have one huge advantage over Legalzoom, which is the human interaction that many clients want when dealing with legal issues that seem uncharted and mystified.

Below are some tips on how you can offer legal products at your law firm.

1) Identify legal services that you are fairly standard across all clients

Think about the services you currently offer. What are some of the services that you can templatize or replicate with very little customization?

2) Fix prices

Estimate the number of hours it usually takes you to complete the service you have chosen to productize. Look at the bills from recent clients to see how much you are charging clients in total for a given service. Keep in mind that some pricing may be higher and some lower. Choose an average price and start there. Offering legal services with fixed pricing offers consumers of legal services predictability and purchase confidence.

Your pricing may change over time and that’s okay. The data you receive from your retention rates will allow you to scale this particular offering, increase your efficiency and expertise. This also allows you to acquire more client and increase your top line revenue.

3) Determine what steps are needed to accomplish the service and create an internal fulfilment process

For most transactional services you likely already have a template document and a questionnaire for new clients. If you don’t, you’ll want to create these so that you can increase your efficiency and even automate as much of the process as possible. That’s not to say that you can customize the template to meet a particular client’s needs, but starting from a baseline document that you’ve worked on over time will clearly get you to the finished product more quickly.

4) Create a separate product page on your website

For each product you offer, you should have a separate page on your website dedicated to describing it. We’ll call this a product page. By listing the price on the product page, you’ll be allowing the consumer to determine whether or not they are even in your fee range. This will prevent you from wasting your time talking to unqualified leads who cannot afford your service and will also provide you with a competitive advantage since many firms have been slow to adopt this. The goal of the product page is to convert a website visitor into a retained client by providing them with all the information they need to make a purchase decision. By being transparent about the price and what is included, clients are able to draw a conclusion more quickly on whether or not they want to move forward.

5) Set up a merchant account

Just like any other product, you should be able to purchase it online. By setting up a merchant account on your website, you allow people to purchase the product with ease. This was an early advantage of Legalzoom, as it eliminated the need for the consumer to drive across town, pay for parking, take time off work and any other inconveniences normally associated with hiring an attorney.

Following these tips will help you set a foundation for establishing commoditized services at your law practice, which can supplement your more complex offerings. Productizing some of your services will help you stabilize cash flow issues so that you can start developing a recurring stream of revenue. Most importantly, you’ll be providing services in a manner that consumers are demanding and giving your firm a competitive advantage in the process.

One400 specializes in helping lawyers create products out of service offerings. If you would like to talk to us, email us at info@one-400.com

Authors:

Eva Hibnick is the co-founder and Chief of Growth at One400,  a law innovation agency focusing on helping law firms build products, create inbound marketing channels and acquire clients. She was previously the Marketing Manager at General Assembly and before entering the startup world, she was an attorney at Cravath, Swaine & Moore. She is a graduate of Harvard Law School and licensed to practice in New York.

Eva is a frequent speaker on legal marketing and sales. She is also active in the legal tech community, serving as the co-organizer to the LA Legal Hackers Meetup, the LA Legal Community Meetup and was a mentor for the SF and LA Legal Tech Startup Weekends. She has guest blogged for Solo Practice University, The Law Insider, Shake Law and other legal industry blogs.

Allen Rodriguez is the co-founder and Chief of Product  at One400, a law innovation agency focusing on helping law firms build products, create inbound marketing channels and acquire clients.  Prior to One400, he was the Director of Attorney Services at LegalZoom and ran the referral service at the LA County Bar, generating over $2 million in revenue during his term. He has been doing marketing for lawyers and legal tech startups for the past 15 years.

He is a frequent speaker on productization of legal services. He is also active in the legal tech community, serving as the co-organizer to the LA Legal Hackers Meetup, the LA Legal Community Meetup and was a mentor for the SF and LA Legal Tech Startup Weekends.

 

  • Bill

    A couple of thoughts:
    1) As Carolyn notes, this is commoditization. And from a pricing (and profitability) standpoint, doesn’t that translate into a race to the bottom?
    2) If you already have clients paying for the to-be-commoditized product (service) on a traditional basis, are you willing to gamble that the loss of that revenue (because why would they continue to pay you on an hourly basis for the newly-productized work) will be more than offset by the new commodity revenue, and more importantly, that the lost profits are offset by the margin times volume on the commodity work? I am not saying the new model won’t be more profitable, but it strikes me as a very pro-active gamble. Of course, if you are already losing clients to Legal Zoom et. al, you may not have a choice.
    Bill

  • Bill, thanks for sharing your thoughts. I don’t think it’s a race to the bottom. The commoditization of legal services is often associated with lower costs and lower quality. It’s why I talk about flat fee legal services with a predefined scope of work as products instead of commodities. While products and commodities share similar attributes such as predictable cost, availability and function, products on the other hand, can vary greatly in features, quality and price (think Honda v. Porsche). Consumers of legal services have clearly demonstrated demand for predictability in pricing and the convenience of transacting online which is very hard to do without productization. What I’d like to see is more attorney embracing this inevitable future in the delivery of legal services so that more consumers have better options than they currently find at non attorney owned legal services companies like those you mentioned.

  • Paul Spitz

    It isn’t necessarily a race to the bottom, but also, the market in general may be setting price levels. For example, look at a basic agreement like a non-disclosure agreement. What is this really worth? Certainly no decent lawyer writes one from scratch every time a client requests one. The market has set a price for these at about $200. They don’t need a lot of customization by an attorney. Once you have your form in good shape, you can sell it over and over again for $200. Assuming you used a pre-existing form in the first place, and only spent an hour revising it, once you’ve sold your first NDA, every additional one is pure profit. The same is true for single-member LLC operating agreements, independent contractor agreements, bylaws, IP assignment agreements, etc.

    The key is to stop thinking about these in terms of your hourly billing rates. That is an invalid construct when applied to these legal products. The last time I had to do an NDA for a client, it took me all of 5 minutes to pull up the form, change the names, and send it to the client. Should I have charged 5 minutes times my hourly rate? That would be absurd. Should I have charged based on the time it would have taken me if I had started with a blank piece of paper, a jar of ink, and a quill pen? That would be absurd.

    We need to get over ourselves. We need to stop thinking “I’m a great lawyer, I was on law review at Fancy Schmancy Law School, I have a swank office in a high-rise, and my time is worth $450/hour, therefore everything I do is like fine wine and caviar.” There are some really bad examples of legal documents out there, for sure, and many of them come from the biggest, most prestigious law firms. I’m a solo, and I had to humble a partner at Thompson Hine recently for sending out agreements that had never been proofread. Is his NDA really worth 6 times what my NDA is worth?

  • Paul Spitz

    I’m already doing this with a number of legal agreements and projects. What intrigues me is automating the delivery system. I’m not sure I want to have a client order a legal document from my website like they order a book from Amazon. I have three concerns. One, am I incurring malpractice liability when they do this? Two, when a purchase is made in this fashion, is a client-attorney relationship being established? And Three, I want to be able to develop a relationship with a client. They may just need one thing now, but I want them to understand what they are getting, and I want them to feel comfortable coming back to me again and again.

    So I like the transparency of listing the flat-free products that are available, but I still want the client to engage with me by phone, email, or in person.

  • Alex

    I think Bill is missing the interesting point in the article: the former director of attorney services at legal zoom said that the key advantage attorneys have over purely commoditized products is that the attorney can do a little hand-holding in uncharted waters. So what Paul is doing is essentially a hybrid product. Yes there is a form, but the Client also gets Paul to customize the form to suit his or her needs. Sometimes that’s a 5 minute fix. Sometimes it’s more. But either way, a lot of the value Paul provides is wrapped up in his authority, expertise and empathy and not in his “form.”

    In economic terms, attorneys should seek to be complements to legal forms and not substitutes.

    Robot handmaidens, the future of the legal profession!

  • Exactly.

  • Great comment Alex. Though Robot handmaidens is probably not the term I would choose. You know a lot of the discussion here assumes that a client knows exactly which document they need (NDA was used as an example). However, there are more than one type of NDA. I think the attorney is needed on two fronts. The first is for the direction, (which doc is appropriate for their needs). The second is for the hand holding as you describe. The future of law is bright.

  • Sam Miller

    Carolyn, thanks for the great article. I believe services-as-product is the real disruption that the legal services market is waiting for. If an attorney really knows his subject matter, he can segment his advice into flat-fee components and charge accordingly. For the consumer it provides the transparency and certainty that has long been the chief complaint and reason for evading using attorney services. The gap is being services by the likes of legalzoom, rocketlawyer and a plethora of legal sites out there. But they lose the crucial lawyer insight and direction. By combining the attorney element into the flat – fee product, it is a win- win situation. Have a look at http://www.svperbar.com which is market place and platform for flat-fee legal advice products. It is purely transparent not only from the clients’ point of view but also from the attorneys’: there is no price fixing and attorneys are welcome to compete against each other on price or aspects of their service. I would be happy to answer any questions about the site and review any attorney applications to post products.

  • Sam miller

    Thanks to Eva and Allen! Would love to chat further about this

  • Paul, you bring up some interesting issues. Unfortunately, I am not qualified to answer whether or not your incurring malpractice liability. However, I can address what you said about wanting the client to engage you by phone, email or in person. It really comes down to how you choose to setup your delivery system. Based on what you describe here, I’d recommend you allow client to purchase a service of their choosing much like ordering a book on Amazon, but that you don’t automate the delivery. Instead, part of the checkout process requires that they set up an appointment with you (this can be automated) so that you can speak with them and make sure that their selection really is the appropriate instrument for their needs. In the event that it is not, you can provide a credit towards the correct instrument and or custom work for services you have not productized. This makes sure that the client gets the best service possible, you probably reduce your liability exposure and are able to close clients without initial consultation (the money will be in the till by the first call). Hope that helps.

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