How to Select Clients for Cross-Selling

by Eric Dewey

Cross-selling is the holy grail for law firms. Clients who like you and recognize the value you provide are more likely to expand their use of you. More to the point, they are more likely to trust your recommendation of other partners in the firm.

But most cross-selling initiatives fail because lawyers are not adequately prepared.

They may have done their research on the company, but they haven’t tried to understand the operational culture of the organization, the stuff not found in a 10K. They don’t understand the company’s priorities or its internal buying decision dynamics. As such, the pitches can feel random and untethered to any real needs of the business.

These questions will help you identify prospective clients who are both in need of the services but also in a position to solve the issues and, as such, will be more receptive to your overtures.

Keep in mind that this process is not required for all practice areas or all clients. Typically, it works best as a pre-sale exercise for clients who have a degree of discretion on which legal challenges they solve. Some practice areas leave little room for discretion, such as litigation defense. Clients facing a class action must defend themselves. Similarly, some clients are better understood by their outside counsel which may also reduce the need for this questioning process. But if you can’t answer these questions on your own or are pitching a new practice area that is optional for the client, this process will help you get the knowledge you need to pitch with confidence.

Here’s what to do.

Start the process by first identifying the practice areas with synergy to your practice area—that is, identify the practice areas commonly used by companies in the industry that you are targeting. Often the practices can be identified in your billing data by looking at the practice type of newly opened matters of a group of clients within a particular industry segment. You may also have an intuitive sense of the practice areas commonly used by your clients. But it’s nice to have research to confirm your suspicions.

From this list of potential cross-selling practices, select a partner that you like, trust, and respect. Meet with them to discuss this process and identify a group of 5 to 6 clients that you will focus on for this first phase of the process. Identify the specific legal solution that would form the basis for your proposal. Be as specific as possible. For instance, 'employment law services' is too broad. Updating the company’s employee manual is specific. Do the research necessary to validate, as best you can, the need for that service.

For each target client, discuss what you know about the client’s need for the cross-sold practice/legal service using the criteria below. Keep in mind that proposals for legal services are essentially proposals for the company to change some aspect of how they operate or do business. Therefore, when we talk about ‘decisions’, we mean the broader concept of legal solutions that may require a change initiative within the organization.

This bears repeating. Some decisions to hire outside counsel can be made quickly, typically because the company has little discretion in whether it will address the problem. In such cases, such as in litigation, there are fewer decision-makers, and the decision typically must be made quickly. But most legal proposals are ‘optional’ in the sense that the company has discretion whether to or in how quickly it will solve the issue. The questions below are best used in this context. Use them to understand the buying journey and buyer’s motivations for deciding to solve legal issues and hire outside counsel.

Good cross-selling targets are clients with whom there has been a long, mutually beneficial relationship. The clients should be very familiar with the firm and

preferably have had very good experiences with you or the firm. The practice area being proposed should have a reputation for excellence and be well established in the field. As obvious as this is, it bears repeating: approaching clients with additional services that are not well-established, don’t have an active client base or that doesn’t have a good reputation in the marketplace is counterproductive. Be sure you’re competitive with what you propose.

Buying Motivation Analysis

Buyers must be motivated to buy. They must recognize a legal need, have made that need a priority, and they must have a consensus inside the company about what the best solution should be. Until they have those elements in place, cross-selling won’t cause buying. The key to successful cross-selling, therefore, is in getting a read on the internal buying decision process and the relative priorities of the organization. Only then can you craft an approach that aligns with the company’s needs. This process will help you do that.

These questions are intended to guide the dialogue with prospective clients which can take place over several meetings, if necessary. The objective is to discover as much as you can about how the company operates, how it prioritizes projects, and who participates in the decision process. The information gleaned through these discussions will help you determine whether the prospective client is in a position to engage you. It can also give you insights into a pitch strategy and can clarify ahead of time the objections that may lie in wait once you’ve delivered your proposal. Conduct this analysis on each practice area and for each prospective client to prepare for cross-selling conversations.

Importance: What is the relative strategic importance of the issue to the company considering the business model and operational priorities of the business?

Explanation: Not every legal solution is critical to the success of a business. Understanding the degree of importance to the successful operation of the business is critical to get a sense of the resources and timing that a company will put toward solving the issue. An issue that is strategically important to the company will get the budget and resources needed to solve it. An issue that is not strategically important to a company can be put off or not done at all. Look at the strategic importance of the issue from the client’s perspective only—keep your perceptions of your work’s importance out of your analysis. For instance, you may feel strongly that having an up-to-date employee manual is critical, but in the greater scheme of the company’s other priorities, it may hold little importance.

Urgency: How quickly must a company decide as to whether and how it will solve this particular legal issue?

Explanation: Issues with a deadline, must be resolved in a certain time frame or which must be resolved before other more important projects can be done have urgency. Knowing the inherent timelines and deadlines can help the company prioritize resources and allocate personnel. You should know what is driving the urgency of a solution so you can use it to your advantage.

Priority: Thinking about what you know about the company’s strategy and business model, what is the relative priority for resolving the issue compared to other priorities of the company?

Explanation: Issues can be strategically important and urgent to a company, but even solutions that meet these important criteria can be subjugated to other, more important priorities in the company. Understanding the priority of the issue for the company, specifically where it fits in their strategy, can provide lawyers with important insights into how the company will receive your proposal. Ask yourself, would this proposal be timely considering all that the company has going on?

Decision Authority: Who are the people who will have input into the decision?

Explanation: Rarely is a decision in a company made by just one person. As decisions on new initiatives are contemplated, numerous insiders weigh in on how the decision will affect their areas of responsibility, how the decision should be made, and what criteria should be set for choosing a provider. What we think of as the final decision authority or the single decision-maker, is the person who builds internal consensus for decisions. They lead the development of the decision criteria that, once fully formulated, guide the decision process. As such, lesser-known players may have an oversized influence on decisions, so it's important to understand all those who will have input into the decision process.

Stakeholders: Who has a stake in what happens after the decision is made to solve a legal issue?

Explanation: Stakeholders are the people who must live with or work to execute the changes brought about by legal solutions. These people have control of operational domains which require their input into the decisions as well as how to execute once the decision has been made. Knowing who will help deliver the solution, monitor its implementation, and assure its success is important for the success of any project. So, getting to know their concerns, interests, and objectives for the change is critical to successfully managing a change initiative in the organization.

Influencers: Who influences the decision?

Explanation: Influencers are different from stakeholders in that they have influence over decisions but are typically not directly involved in making the decision or implementing it. Influencers can provide resources and information to help in making decisions, sometimes to the point of withholding assistance if the decision is viewed negatively. Influencers can come from accounting, finance, HR, operations, marketing, from among suppliers or key clients or other places in the organization.

Operational Implications: What changes or implications will likely occur in the company’s operations or service delivery if the proposal is pursued?

Explanation: Some legal solutions force changes to the operational status of a company. Companies have a strong bias toward not upsetting the status quo of a smoothly operating system. Understanding how the company may be affected and what changes in its operations will need to be made will help sellers ask better questions and better discuss how the solution will affect the company.

Risks and Rewards: What risks and rewards can be anticipated if the issue is or is not resolved?

Explanation: Along with the operational implications of a legal solution, there are risks and rewards associated with that solution. Exploring the consequences of the solution (both intended and unintended) can help company representatives prepare for implementing the solution. It also will help demonstrate your understanding of their business. It’s helpful to put a monetary value on the risks and rewards inherent in a solution when possible. Doing so will give you more context for the risk or reward which companies need to set priorities. Incumbent and Alternative Solutions: What other resources, people, or organizations can be mobilized by the company to solve this issue?

Explanation: Companies have many alternatives in how they can solve various problems and issues. You are not their only option. Often there are incumbent providers capable of solving the issue, including in-house resources and other outside counsel. Similarly, they may have available to them non-legal solutions to the issue. Exploring these helps you to better understand your competitive positioning and will help you define your pitch strategy.

Provider Selection Criteria: Beyond expertise and experience, what additional criteria might the company consider in reviewing provider qualifications?

Explanation: Numerous criteria will drive the provider selection process. Most of these are obvious. However, some will be less obvious and will be unique to the company or its business challenge. Discussing these criteria will further help you understand the company’s operations, explore how well you meet their selection criteria, and provide insights on the value-added services that might appeal to company representatives. If you can’t definitively answer these questions, set up informational meetings with the prospective client to get better insights into their business and its operations. Prepare for the conversation by identifying the specific questions to which you need answers. Going through this review process will help you identify prospects who are in a position to be cross sold, will help you customize your pitch, and make more compelling presentations directed at the key concerns and challenges of each prospect. n

Eric Dewey authors the Legal Marketing Blog, Lawyer Up! and was recently named the Guest Expert of the ABA’s annual marketing and client development edition of Law Practice Management magazine, due out in November of 2013. Dewey’s expertise includes client development; strategy and planning; marketing ROI and client opportunity analysis; client service training and program development; brand and reputation management; and organizational improvement. He can be reached at www.groupdewey.com, Eric@eLegalTraining.com or visit www.eLegalTraining.com.