Unhappy clients are hurting your business
Photo of Jack Newton courtesy of Clio
How satisfied are your clients? The data indicates most lawyers don’t know. When we surveyed nearly 2,000 lawyers in the US, we discovered 37% don’t collect client feedback at all—and for the 42% that collect feedback only casually, courtesy biases suggest they likely receive only the type of positive feedback they want to hear.
The implication of this is that poor client satisfaction could be the most critical blind spot for any law firm. Why? Poor satisfaction is what ruins businesses. If your clients aren’t satisfied, there’s little chance they’ll hire you again or recommend you to someone else—and they may even deter others through word of mouth or slanderous online reviews. It’s a poor prospect for any law firm that wants to succeed.
On the other hand, the types of businesses that thrive in today’s digital economy are the ones that are obsessed with customer satisfaction. The internet has made the competition so readily available, your clients need a reason to hire you over another firm.
To better understand the state of legal services in the 21st century, we set out to answer this question of client satisfaction on an industry-wide scale by using a metric known as a Net Promoter Score (NPS). Research has shown that NPS is one of the most reliable predictors for business growth, and it’s based on more than just satisfaction or loyalty—it’s based on the likelihood to recommend. Given that typical lawyers typically rely heavily on referrals, NPS should be considered especially salient for law firms.
Calculating NPS starts with asking a cohort of clients a standardized question: On a scale of 0 to 10, how likely are you to recommend your lawyer to a friend or colleague? You then calculate the percentage of respondents who answered within the 0 to 6 range (known as “Detractors”) and subtract that from the percentage that responded with a 9 or 10 (known as “Promoters”). Those responding with 7 or 8 (known as “Passives”) neither subtract nor add to an NPS. What you’re left with is a minimum score of -100 (100% Detractors) and a maximum score of 100 (100% Promoters).
For perspective, some of the most successful businesses in the 21st century have achieved incredible growth based significantly on highly favorable NPS. These companies (and scores) include Amazon (62), Netflix (68), Apple (76), Starbucks (77), and Costco (79).
Where does NPS net out for the legal profession? After collecting data from a cohort of over 1,300 American consumers on their experiences working with a lawyer, we calculated a benchmark NPS of 25 for the legal profession as a whole. This is based on a breakdown of 48% Promoters, 30% Passives, and 23% Detractors. While nearly half of clients would highly recommend their lawyer, nearly a quarter of all clients would actually dissuade others from their lawyer.
While an NPS of 25 isn’t entirely bad, it’s nothing to celebrate. Other industry benchmarking studies put this number at the same level as airlines (26), banks (26), wireless carriers (25), and credit card companies (23)—none of which are known for exceptional service. The deeper implications imply that poor client satisfaction is hindering growth in the average law firm.
In our study, we also examined what factors influenced positive client responses. What clients cared most about—which included the ease in understanding case expectations, bedside manner, and overall responsiveness to communications—are all intrinsically related to the ease or difficulty of working with a law firm. Since the growth prospects of any law firm rely so heavily on client satisfaction (as measured by NPS), focusing on client experiences should be how lawyers think about their future success.
This is the first of several columns for the ABA Journal in which I’ll be discussing the nature of client experience in more depth. You can also read more about Clio’s research on today’s legal clients in the 2018 Legal Trends Report.
Jack Newton is the founder of Clio and a pioneer of cloud-based practice management. Jack has spearheaded efforts to educate the legal community on the security, ethics and privacy issues surrounding cloud computing, and is a nationally recognized writer and speaker on the state of the legal industry. Jack also co-founded and is acting President of the Legal Cloud Computing Association (LCCA), a consortium of leading cloud computing providers with a mandate to help accelerate the adoption of cloud computing in the legal industry.
