You wouldn’t post something on Instagram and never check your likes and comments, or go to the doctor for a physical and leave before finding out your results, or hop on a plane without figuring out where you’re going next…so why would you take a laissez-faire approach with respect to your law practice?
What we’re saying is—if your personal injury firm spends a lot of money on marketing campaigns and you don’t track your marketing KPIs (“key performance indicators”), then you’re basically setting sail on a ship without a compass—you could discover a hidden treasure or you could hit an iceberg.
That’s why the best way to stay afloat is by regularly using KPIs to track your marketing efforts—they allow you to navigate your way to efficiency and steer your personal injury firm towards profitability. Here are some of the more important marketing KPIs to track…so you can ensure your total marketing spending doesn’t go overboard this year.
Just like you won’t survive without food, your personal injury firm won’t survive without clients—that’s why you have to keep feeding your law practice quality leads. That’s also why you need to constantly monitor the number of quality leads you’re generating on a weekly, monthly, yearly basis (etc.)…and be sure to mix it up—compare your April leads to your March leads, compare your February leads to your September leads, compare your June 2019 leads to your June 2018 leads…and so on—so you can measure different metrics (e.g., growth/decline, seasonality, the effect of different campaigns).
Cost Per Lead (CPL):
You can get a terrible meal at a fancy restaurant or get the best meal of your life at a taco truck. What we’re saying is the amount of money you spend, doesn’t always guarantee you good results…and the same goes for your firm’s lead generation.
You probably spend your marketing budget across various marketing campaigns (e.g., digital ads, print ads, social media, SEO)—CPL measures which of these efforts are the most cost-effective. To determine your CPL for a particular marketing effort, just divide what you spend on the campaign by the quality leads it generates (e.g., if you spend $5K on SEO and received 100 leads, your CPL is $50 or 5K/100)…the lower the number, the better.
What good is a meal if you can’t eat it? So while quality leads are great, clients are better. Conversion rate is a marketing KPI that tells you just how quality your quality leads are—all you have to do is divide the number of leads you’ve converted into clients (either overall or by marketing campaign) by the corresponding number of leads you’ve received (e.g., 4 clients/20 leads=25% conversion rate)…the higher the percentage, the higher the efficiency of your marketing campaigns and intake processes.
Cost Per Conversion (CPC):
To continue the food analogy, this marketing KPI is like an itemized check at the end of the meal—showing how much you’ve been spending to deliver clients to your desk.
To calculate CPC, just divide how much you’re spending on lead generation (either overall or by campaign) by the corresponding number of qualified leads you’ve converted to clients and you’ll get an idea of how many marketing dollars you’re spending just to get a new client…if it’s too much, you need to “send back” the campaigns that don’t work or improve your intake processes.
Marketing Return On Investment (Marketing ROI):
Last (but certainly not least) is the Yelp review of marketing KPIs—this is where you find out your personal injury firm’s overall marketing grade. To get your report card, simply divide the net profits generated by your marketing efforts (revenue minus cost) by the total amount you’ve spent on marketing…then multiply by 100 to get your ROI as a percentage.
For example, if you’ve spent 500K on marketing efforts and made 1.5 million in revenue generated through these efforts, your marketing ROI would be 200%, or (1.5M-500K)/500K X 100. The higher the ROI, the more efficient your investment; while a negative ROI means you’re losing money on your efforts and should probably switch things up.
If you’d like to switch things up right now, check out CloudLex’s next-gen cloud platform and sign up for a free demo…we’re a one-stop shop for all your personal injury firm’s needs. Through our targeted reports, you’ll gain in-depth insights into your firm’s key performance indicators—so you can decide where to allocate or scale back your office’s marketing resources and how to make your personal injury firm more efficient.