Not all expenses are created equally. One metric many law firms like to use is “cost per case,” or how much a firm spends to sign one new client. But did you realize that there are actually three different costs per case? By calculating exactly how much you’re spending on a new client through each step of the process, you can ensure that you’re using your marketing dollars wisely.
Cost Per Desired Case
Your cost per desired case is how much you spend to receive one claimant you wish to sign as a client. A low cost per case is indicative of a high-quality lead source.
Two factors that play into cost per desired case are lead quality and outreach. High-quality leads will of course have a low cost per desired case, but it’s impossible to accurately evaluate a lead generation service without making effort to contact your leads. We recommend calling your lead at least 10 times before “throwing in the towel.”
A good rule of thumb to have is that if your cost per desired case is around 10-20% of your expected client revenue, the marketing channel is profitable.
Cost Per Signed Case
Your cost per signed case is how much you spent to actually sign up a new client. The cost per signed case is almost always higher than your cost per desired case because not every claimant will want to work with an attorney for one reason or another.
It’s common for your cost per signed case to be a little higher than your cost per desired case ($250 compared to $300, for example), but if there is a large discrepancy between the two costs it’s likely that there is inefficiency within your firm that needs to be addressed.
For example, you may have difficulty getting a client to return a retainer package. To reduce time spent waiting for returned paperwork, we offer our own case and management software, eLuminate. eLuminate allows your firm to send documents for electronic signature. Retainer packages, requests for medical records, and dozens of other standard documents come preinstalled on eLuminate.
Cost Per Won Case
Your cost per won case is how much you spent to win a claim. It will be the highest expense because it’s of course impossible to win every single claim in court.
If your firm has more than one attorney, it’s more likely than not that you’re already tracking their win percentages. Knowing how many successful claims an attorney handles is important not only for calculating expected revenue, but ensuring that you’re as efficient as possible with your marketing budget. If you’re spending an arm and a leg on lead generation solely due to an attorney’s inability to win cases, it may be time to revaluate your staffing needs, or take claims in a different area with more desirable ODAR offices or favorable auto liability laws.
How Can You Achieve a Low Cost Per Case?
One of the biggest costs not mentioned? Labor costs. Every step will need an intake team evaluating your potential leads, reaching out to claimants, sending paperwork, and of course winning claims in court. Lead generation for law firms is a great way to keep costs low. Instead of paying for your own PPC campaigns or SEO efforts, you’re ensuring you receive contact information from claimants indicating interest in speaking with an attorney immediately.
Our Social Security disability clients see a highly desirable average cost per desired case of $300, while our personal injury clients have a cost per desired case of $550. To learn more about our lead generation services and pricing, give us a call today at 617.800.0089.