"My Ideal Client Can't Afford Me."
On a coaching call this week, one of my clients said:
"My ideal client for my estate planning law practice is younger families. My plans start at $400 because they can’t afford what I want to charge. "
I hear this a lot from clients and when I do, I have to shake my head. Trust me, if you are an estate planning or business attorney, there are ALWAYS potential clients who need your services. It’s up to you to show your value and convince clients why they should choose you. So, I'm going to break down the thinking behind that notion and show how you can get free of that race to the bottom.
1. If Your Ideal Client Can't Afford You, They Are NOT Your Ideal Client.
If they can’t afford you, how can they be your ideal clients? The definition of an ideal client is someone who needs the exact thing you are selling.
Not only can your ideal clients afford you, but they also value your legal services. If you are marketing your practice correctly, you should be able to convey your services’ value and convince ideal clients that you are well worth the investment.
Now, I'm not saying it will be easy right out of the gate. Building a client base that trusts you takes time (the average person has to see your marketing 7 times before they even start to notice you - 7 TIMES!). In this day and age, we can be impatient with business results, but the truth is...business isn't always easy. And here is where we get into trouble: When we aren’t selling our services as quickly as we want, we so often turn to the issue of “affordability” instead of questioning whether our messaging or marketing or services are the problem.
2. Pricing Based on “Affordability” is a Race To the Bottom
Let’s run a little scenario: Say you’re building a business law practice that focuses on serving tech companies. Your contract package begins at $4000, but when you start to search for clients, you hear over and over that startups “can’t” afford your services. You plan on having 10 clients at a time for a monthly revenue of $40,000.
Decide that your ideal clients can’t afford you and lower your prices to $500. You can only see 10 clients at a time, so your monthly revenue drops to $5,000.
Decide that you are only going to focus on companies that have been in business 5 or more years and can expect higher earnings and are therefore willing to pay your rates. You raise the package price to $6500 and start making $65,000 a month.
Start communicating the value of your services more clearly, noting that 95% of your past legal clients have gotten funding after working with you. You become a leader in the tech community, your waitlist increases to six months, and you easily earn $40,000 a month.
Create an online program for startups teaching them how to protect their business's IP on their own that is $500 but allows you to leverage your law degree across a larger audience giving you a monthly revenue of $50,000.
Do you see how the thought that our ideal clients can’t afford us leads us to believe that #1 is our only option, when #2, #3, and #4 all allow us to reach the same clients without lowering our rates? And can you see the flawed logic in the idea that a startup can’t afford legal services? Of course, they can! In fact, spending $4,000 to get a multi-million dollar investment deal is a steal.
3. What is the VALUE of your legal services?
At Juris Diction, whenever we price a new offer or service, we don’t think about how long it’s going to take to build or deliver, or how much money we want to make that month, or what we think the customer can afford. We ONLY think about the value that the customer is going to get from the offer.
Cost-based pricing process begins with the product cost, and a price is set before taking the value created for clients into consideration. A value-based pricing process does the opposite. It begins with the client. A law practice needs a very clear understanding of the type of ideal client it serves, and the specific value it creates for that type of client. When the focus is on the value created, the product cost becomes a secondary consideration.
If you are a business attorney, ask your ideal clients what they would pay if they knew a simple contract could prevent them from tens of thousands of dollars of litigation. If you are an estate planning attorney, ask your ideal client what they would pay to make sure their children never end up in the foster care system.You might be surprised how much your ideal client - regardless of income level - is willing to pay to get real results and real protection.
To your success,
P.S. Next Level Law Practice has launched!! This 10-week program is for attorneys who are ready to take their business growth seriously and create a sustainable estate planning or business law practice... FAST. I am showing you EVERYTHING I put into my own law practice and more. Check it out!
P.P.S. Have you attended our FREE Masterclass? If not, check out 5 Steps To Transform Your Law Practice where we'll show you how to add an additional six-figures to your income without taking on more clients! Click here to sign up!
P.P.P.S. If you are ready to join a community of incredible attorney-entrepreneurs, click here to join the Thriving Lawyer Society! We share articles, trainings, master classes, and helpful tools to help you untie your earning from your hours and build freedom into the practice of law.