Using Cost Per Case To Revolutionize Your Firm's Marketing Strategy
By Deanna Power
Are you having difficulty figuring out how to market your firm? Between TV and radio commercials, print and internet ads, billboards and blogs, it can be overwhelming to determine what avenue will best reach your target clients.
Many firms take a blanket approach to marketing, choosing to invest a bit in whatever advertising methods they have access to in order to appeal to as many people as possible. However, this marketing ideology can waste money by investing in advertising styles that aren’t sufficiently attracting new clients. So how can you tell which ad styles work and which don’t?
Using the cost per case method, you can throw guesswork to the wind and determine what traditional advertising methods work best for you and your firm to save effort, money and time.
THE SIMPLICITY OF COST PER CASE
Cost per case refers to the amount of money you spend on one ad to sign a single client. The equation is cost of ad campaign / number of new clients = cost per case (CPC).
Most modern forms of advertising (blogs, internet ads, etc.) do this work for you. However, traditional forms of advertising like TV commercials, print ads or billboards have no way of tracking clientele. This equation helps you figure out the effectiveness of traditional advertising. Then, based on the number of clients each marketing method attracts and how much you spent to sign a single client, you can redistribute ad funds into the avenues that work best for your firm.
While the equation works best with real numbers, let’s take a look at a hypothetical example with a billboard ad to see CPC in action and help understand what makes a good or bad CPC.
SAMPLE BILLBOARD AD
Billboards are a popular marketing option for thousands of firms across the country. Let’s say your firm is looking to attract clients living in Oklahoma City. You find a billboard in Oklahoma City along I-44 beside the fairgrounds, a common through area for commuters and truckers. For a four-week ad campaign in this location, you would need to pay $5,425.
After your four-week ad period, it would not be unreasonable to attract 7 new clients looking for representation. If we plug these numbers into the CPC equations, we’d see $5,425 (cost of ad campaign) / 7 (new clients) = $775 (CPC).
In this scenario, your firm would have paid around $775 per new client during that month period, but is $775 a “good” CPC? It would completely depend on your area of law.
A CPC is desirable if it is profitable for your firm. There is no right and wrong answer here, and firms with the exact same CPC can have wildly different revenue. For example, criminal defense lawyers who can make $10,000 or more per case can afford a CPC of $775 because their clients are few, but lucrative. For Social Security attorneys who make around $3,000 per case, with a maximum of $6,000, $775 would be far too much to spend on just one new client. If a CPC costs around 15 percent of your expected settlement, you’re likely profitable.
BEFORE YOU GET STARTED
The following tips are important to remember when using the CPC method for your firm:
Real numbers get real results. While hypothetical situations such as the one above can help you figure out where to start, you should never assume the success of an ad campaign and location without using real data. You can evaluate the past 12 months of marketing data to begin utilizing CPC.
Always ask clients how they heard about your firm. If you assume your clients found you from a TV commercial when they actually found your firm through word of mouth, you may incorrectly believe your firm’s commercial is more successful than in actuality. This can lead to wasted money and false assumptions, which will hurt your firm in the long run. CPC is useless without accurate client attribution
Always have a large sample size. You may sign 10 clients from an inexpensive CPC campaign one week, and sign zero clients from the same campaign the following week. Neither result is likely to accurately reflect your firm’s profitability with the ad. The larger the sample size you have, the more accurate your CPC will be.
If your firm is able to calculate which marketing channels signed clients at a lower cost, you can focus your efforts on whatever ads are most profitable for your firm.
ABOUT THE AUTHOR
Deanna Power is a marketer specializing in search engine optimization and content creation.
She lives in Boston and is a graduate of Emerson College. She works for eGenerationMarketing, a digital legal lead provider. She can be reached at firstname.lastname@example.org.
Originally published in the Oklahoma Bar Journal -- OBJ 89 pg. 38 (January 2018)