The truth is that every attorney requires a consistent flow of new law firm leads to grow and sustain their legal practice business. While there are many attorney lead generation companies out there, there are significant differences in lead pricing, exclusive vs. non-exclusive leads, calls vs. forms fills, and so on.
Therefore, it means that all law firm leads are not the same and won’t cost the same. Some cost more than others, depending on the legal area and quality of the lead.
Some leads may be highly qualified and exclusive, requiring less effort on your side to convert them to new clients, while others may be poorly qualified and non-exclusive.
Read this blog post to the end to understand everything you need to know about the cost of attorney leads.
A Quick Overview of the Attorney Lead Generation Process
Typically, attorney lead generation falls into two categories, namely active and passive generation.
Active lead generation is mainly focused on providing a number of new law firm leads consistently over a specified period such as a month, six months, or a year. In this case, an attorney may pay to receive legal leads for certain types of cases, such as car accident or divorce, that are generated through online advertising, TV, print, or radio ads.
Once the leads have been generated, they are passed over to the buyer through either an exclusive or non-exclusive lead distribution system, depending on the agreement.
On the other hand, passive lead generation is more focused on marketing your brand and is intended to generate a consistent flow of leads over the long term.
Some of the passive attorney lead generation strategies include running SEO campaigns and leaving a good rating on lawyer review and rating sites such as Yelp.
What Determines the Cost of Law Firm Leads?
When determining the cost of attorney leads, everything can be pretty complicated. This is because many factors come into play when determining pricing points.
Some of them include the quality of the leads, the average cost of closing cases, the legal practice area you specialize in, and even the number of leads you want to buy.
The other thing that will also be considered is where your law firm is located. Typically, if you are operating in a big city, you will most likely pay more for your leads than an attorney in a small city because big cities are highly competitive markets.
Working with experienced attorney lead generation experts who know what they are doing is critical at this time. Otherwise, you may end up running into massive losses. PALO is one of the most trusted attorney lead generation companies in the pay-per-call industry.
Non-Exclusive Law Firm Leads- Distribution and Cost
The best way to handle the issue of how much attorney leads cost is to look at it from the exclusive vs. non-exclusive angle.
Generally, non-exclusive leads are distributed to several attorneys at the same time. It means that the most aggressive attorney will most likely win the prospect.
Non-exclusive attorneys are usually attractive to junior attorneys who are just starting because the Cost Per Lead (CPL) is relatively low. For personal injury leads, the cost per lead will be anywhere between $50 and $150.
While the CPL is relatively low, the cost of converting the lead to a new case may be relatively high due to stiff competition. This is because you have to act so fast and hire people who are experienced at convincing people.
If you don’t have an incredible marketing team, you may end up spending a lot of money without realizing any sensible return on investment.
Generally, the chances of converting the lead will decrease depending on the number of lawyers contacting the prospect.
Therefore, to understand what the non-exclusive law firm leads really cost, you have to go beyond the cost per lead and look at the cost per acquisition.
For instance, for a typical personal injury attorney, the average conversion rate for a lead stands at 10%, meaning only one new client is brought in for every ten leads. However, when several attorneys are working on the same lead, the conversion rate drops even further.
It means that if the lead generation company sells the same lead to four different attorneys, there is only a 25% chance that you will win the prospect. Considering this plus the typical 10% conversion rate, the actual conversation rate for the non-exclusive leads drops to 2.5%.
So, it means that you will need to bring in approximately 40 leads to get one new case. If the lead generation company is selling one lead at $100, then the cost of acquisition will rise to at least $4000.
Exclusive Law Firm Leads- Distribution and Cost
Exclusive leads are only generated for one attorney. In this case, you have no competition whatsoever with other lawyers for the same lead. While these leads may look quite expensive at a glance, the overall cost of acquisition is much lower compared to what you’d pay converting a non-exclusive lead.
For personal injury attorneys, the cost per lead for exclusive law firm leads can range anywhere between $200 and $400.
This figure may seem slightly higher but the cost per acquisition is lower. Let us assume that the lead generation company provides you with ten exclusive leads for $2000. In this case, each lead costs $200.
With a conversation rate of 10%, you should be converting at least one lead for every ten leads. So, in this case, the cost to acquire one new client will actually be much lower than $2000.
What Is a “Good” Cost Per Lead (Case)?
Whether you are using the exclusive lead distribution or the non-exclusive lead distribution model, the most important thing you need to ensure is that there is a good ROI.
The Cost Per Case (CPC) can be calculated using the following formula:
CPC= Budget Spent on Marketing Channel/Number of New Clients Acquired
So, what is considered a “good” CPC? $100? $200? $1000? Well, the truth is that the answer isn’t as simple as one benchmark number for all attorneys or law firms to strive for.
In most cases, a good CPC will mostly depend on how much money you earn from the client.
The CPC can vary significantly across different areas of law and even within the same area of law. Generally, a good rule of thumb is to ensure you are spending at most 15% of your expected case settlement per client.
So, if you are an attorney specializing in Social Security Disability, you should aim for $450 and below, while personal injury and workers’ compensation lawyers should aim for a CPC of $1,500 and below.
Just keep in mind that there is no perfect and static guideline.
Typically, if your law firm wins more clients than others or receives slightly higher settlements from profitable mass torts such as Paraquat, then you can afford to spend even more on marketing and acquiring new leads.
What Are the Key Points to Focus On While Buying Law Firm Leads?
Some common traits stand out among attorneys and law firms that successfully convert leads into new clients. Here is a quick summary of some of the critical points you need to focus on while buying leads.
- Ensure the leads are exclusive to your area.
- Always be prompt and on top of your leads once they come in.
- Emails should be mixed with calls. Don’t focus on one communication channel exclusively.
- Reach out to the leads multiple times if necessary but know when it is not working out and stop.
- Track your leads effectively.
- Be dedicated to the leads that convert and offer them the best representation possible.
- Install lead conversion software that is user-friendly and works pretty well in your legal area of practice.
PALO Is Here to Help You Propel Your Law Firm to the Next level with Exclusive Law Firm Leads
At PALO, we specialize in generating highly qualified exclusive leads that turn into high-paying clients. We don’t cut corners with our marketing, and most of our leads are generated from carefully designed campaigns we run online.
We strive to connect you with genuine people who are actively looking for an attorney to help them with their situation. Talk to us today to find out if we are a good match.
