Fafinski, Mark & Johnson (FMJ), a seventeen-year old, mid-sized Minnesota law firm is poised to embrace 2017 with a 17-themed special of its own: offering new business incorporations for just $17.17 – plus expenses, reports the Star Tribune . The goal behind the $17-special is two-fold. First, the firm wants to help more fledgling businesses to get up and running and thrive. Second – and not surprisingly – the offer is also a loss-leader, intended to lure prospective small business clients with the hope that they’ll reward the firm with more business as they grow.
Is a seventeen dollar special an effective marketing tool? As with nearly everything in law, reasonable minds may differ. One the one hand, some argue that treating clients to bargain-basement rates at the outset creates an expectation that future services will be similarly priced. As a result, these clients may balk when asked to pay full-fare down the line. Moreover, a $17 incorporation isn’t a guarantee of future work: studies have shown that Groupon deals are often one-offs, and there’s other evidence to suggest that many businesses that rely on small or local firms at the beginning don’t necessarily dance with the ones who brought them when the business hits the big-time. These drawbacks are evidence that $17- incorporation isn’t a set it and forget it strategy requiring ongoing outreach and support to even have a shot at keeping these clients for the long term.
One the other hand, a $17-dollar incorporation can generate free publicity – case in point, FMJ’s mention in the Star Tribune. And it allows the firm opportunities to meet clients on their own turn, as opposed to at a trade show or networking function where firm lawyers are competing with the dozens of other firms that show up in search of business. And let’s face it, actual nuts and bolts of incorporation aren’t all that complicated – heck, if a firm doesn’t already have its own incorporation forms, it can pull them off the Internet for free.
As for me, I’ve long been a strong advocate of the power of free (and by extension, cheap) as a way to attract and retain clients. The risk of accustoming clients to low cost rates can be mitigated by confining the terms of the deal to a single matter – such as a will or incorporation – as opposed to offering several months of rate discounts. Also, at a time when quite honestly, it’s pretty easy to find fill-in forms online, loss-leaders are likely to be most effective if coupled with advice and recommendations from the lawyer. Other ideas for introductory offers are tune-ups or audits e.g, an offer to review a business’ Legal Zoom document at no cost, but charge for any changes or amendments that might be necessary.
Have you ever offered similar programs at your firm and what’s been the result? And do you think these kind of loss leaders for wills or incorporations are still viable in an era where forms for these matters are readily available online and at no-cost? The comments are open…
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