Last month, an email subject line from BTI Consulting Group captured my attention: “Law Firm Growth Surges – But Business Development Investments Nosedive.” This surprising juxtaposition underscores an ongoing philosophical challenge for law firms: balancing growth with strategic investment in business development.
BTI Consulting Group cited research indicating that as law firms grow larger, their marketing and business development investments are shrinking. For 2024, research is projected to show that, on average, law firms dedicated just 2.47% of their budgets to marketing and business development, a decline from the pre-pandemic investment level of 2.76% in 2018. How is this possible?
An overview of the research highlighted a “silver lining”: 57% of marketing and business development budgets are now being allocated to client development, a significant increase from the 34% pre-pandemic rate. This shift reflects what we hope to see as a broader trend in the legal industry, where firms are recognizing the value of deepening relationships with existing clients as a more sustainable path to growth. By focusing on client development, firms can achieve more predictable revenue streams, foster loyalty, and better position themselves as indispensable partners.
BTI President & Founder Michael B. Rynowecer poignantly stated, “More money alone won’t win the game – how firms allocate these resources will determine their future.” My work mirrors this philosophy, and in my estimation, there is no better use of money or resources than investing in relationships with both potential and existing clients.
In uncertain business times, consistency and predictability are paramount. I would argue that predictability is a better measure of long-term success than record-setting profits. Law firms cannot afford to take a reactive approach to business development. Consistent investment, a focus on diversified business development efforts, and a commitment to fostering a culture of business development are keys to long-term success.
Law firm leaders should ensure their firm’s culture embraces active business development efforts. Providing resources that empower attorneys to take ownership of growing their client base and supporting teams of lawyers with a shared mindset and execution strategy moves well beyond just words.
This can also include implementing structured training programs, providing attorneys with the flexibility needed to nurture relationships outside of the office, and regularly reviewing client feedback to adapt strategies. I’ve previously shared advice on how firms can support new partners in their business development efforts, which may be helpful in developing a more formalized approach to business development.
Growth should be embedded in the firm’s daily practices. Steady and sustainable growth can only be accomplished through steady and sustainable investments, which I believe is the only way firms can successfully adjust to ongoing changes and challenges in the legal market.
