Top 3 Characteristics of High-Growth Law Firms
In its recently released 2017 High-Growth Study, professional services marketing and research firm Hinge Marketing looked at more than 1,100 “high-growth” professional services firms — including law firms — to determine what exactly allows these firms to attain an annual yearly growth rate of at least 20% and why they are twice as profitable as no-growth firms.
Here’s what they found to be the top characteristics of high-growth firms:
Specialization. High-growth firms are highly specialized and focus on offering a particular service or solving a particular challenge. Whether it’s industry or geographic specialization, these firms have been able to carve out a specialized niche and are highly skilled in growing and promoting their expertise in that niche. Specialization itself becomes a competitive advantage, allowing these firms to differentiate themselves from competitors by understanding the needs of a narrow marketplace and zero in on their target audiences with messaging that speaks directly to their needs.
Technology. High-growth firms were three times more likely to use technology as a differentiator and market their use of technology successfully. Not only do they employ technology to automate many of their internal processes, they are able to quantify the benefits to clients in a way that is a powerful differentiator.
Marketing. High-growth firms invested 43% more in digital and traditional marketing and experienced 74% more impact than no-growth firms. The top 10 marketing techniques with the greatest impact for high-growth firms included:
High-growth firms invest more in marketing staff, maintaining a 15:1 ratio of marketing employees to other full time staff versus no-growth firms that have a ratio of 48:1.
High-growth firms also use metrics to routinely measure their marketing success in terms of number of leads generated, web traffic, website conversions, brand awareness, social media engagement and speaking engagement invitations.
In addition, high-growth firms typically have a better understanding of their target audience than their no-growth peers, with more than 33% of these firms conducting quarterly research on their target audience.
By focusing in on these three key areas — specialization, technology and marketing — high-growth firms are able to achieve a median annual growth rate of more than 34% when compared with no-growth firms, as well as 20% higher median revenue per employee and a profitability rate that is twice that of no-growth firms (20% vs. 10%).