Takeaway #3 – Your lawyers can’t be all things to all people
Selecting a niche is a good use of marketing resources and it helps position your lawyers as thought leaders in X.
The concept of niching isn’t new to law firms (nor me talking about it). Plenty of firms, including large and small, have developed an industry focus or a focus on a very specific area of expertise.
However Seth states that we should take ‘niching’ down to the extreme and focus our efforts on ‘the smallest viable market’.
I have copied four quotes from Chapter 4 – The Smallest Viable Market that sum up this concept perfectly.
“The relentless pursuit of mass will make you boring, because mass means average, it means the centre of the curve, it requires you to offend no-one and satisfy everyone.”
“If you could only change thirty people, or three thousand people, you’d want to be choosy about which people. If you were limited in scale, you’d focus your energy on the make-up of the market instead.”
“Everything gets easier when you walk away from the hubris of everyone. Your work is not for everyone. It’s only for those who signed up for the journey.”
“ ‘It’s not for you’ shows the ability to respect someone enough that you’re not going to waste their time, pander to them, or insist that they change their beliefs. It shows respect for those you seek to serve, to say to them, ‘I made this for you. Not for the other folks, but for you.’”
For law firms, one of the most contentious topics is the idea of the ‘full service firm.’ So many of the larger firms consider themselves to be ‘full service,’ which I’d argue means absolutely nothing to a client if it’s not paired with technical experts that understand their industry and/or problems intimately.
From my own experience, I can say that it can be incredibly difficult for a marketing or BD person in a law firm to convince a partnership, CEO or COO that the entire firm should position itself as X. I’ve seen very experienced Marketing Directors and very expensive management consultants fail to convince firms to change. This is because, for most firms, making that change is too drastic and therefore virtually impossible to get unanimous buy-in for.
Where I have seen great success is in bringing a ‘niche’ or ‘smallest viable market’ concept to a particular partner or a small group of lawyers who share a similar client base.
A hypothetical, extreme (yet feasible) example
If you’re a fifteen person law firm, stating that your industry focus is property or aviation is far too broad. You need to get more specific. No-one would believe that a firm that size can service all aviation-related organisations.
Perhaps your smallest viable market could be:
- You work with the owners and management teams of privately-owned and small, public airports around Australia.
- In your team, you have experts in aviation law, property and planning law, retail leasing, tax, insurance, and general commercial advisory. Three of your lawyers previously worked as in-house lawyers for a major capital city airport. The firm was established to make the lives of owners and CEOs of these airports less complex.
- Your Managing Partner is on the Governance Sub-committee of the Australian Airport Association and your firm is their major sponsor of the association’s national conference each year.
- Your firm hosts a quarterly discussion group at your office for airport CEOs and hand-picked advisors, including an airport industry-focused accountant and OH&S consultant. A topic is set before the event and the CEOs can provide their experience handling a specific challenge.
Compelling, isn’t it? Quite literally, this firm would be the law firm for privately-owned and small, public airports in Australia. Why would anyone in this market choose a generalist commercial law practice over this firm?
Remember, marketing is good and effective when your intentions are to:
- improve someone else’s position (move them from A to a better B), and
- when you are the best person/business to help them make that change happen.
This hypothetical firm would be a dream to market! The plan would write itself and the content would be extremely specific. It would get serious traction, but more importantly it would be an incredibly useful service for clients in this market, and it would have serious potential to be an amazing business for the partners. It’s win-win.
The lawyers at this firm could clearly make a concerted effort to listen to their smallest viable market and create genuine value for those who are members of it.
The smallest viable market isn’t just for small firms
It’s a trap to think that the ‘smallest viable market’ only applies to small firms. I strongly believe the big firms can carve out dominance in a number of niches; this is where ‘full-service’ can exist. In a two-thousand lawyer, global law firm the banking industry could be a reasonable viable market, and it may have other related industries that it serves.
Large, global corporations still require large, global firms that can support large in-house legal teams. A great, real-life example is Linklaters (UK). They are a firm with 2,000 lawyers that operates in twenty countries, and only service multinational corporations and industries that fit that business size (financial services, industrial businesses, etc).
But the 200-lawyer law firm that’s website claims it understands its client’s needs and has a ‘focus’ in twenty industries is kidding itself.
Niching has become more necessary than ever before
As we’re all aware, the legal industry is currently going through massive change and disruption.
Direct competition is getting fierce and more and more firms are merging in a bid to compete or offer something more to their clients. These are traits of being at the ‘mature’ phase of an industry life cycle.
Despite this, I’d argue that the bigger challenge law firms face is the increased competition from alternatives (growing in-house teams and increasingly sophisticated legal technology).
The pursuit of the smallest viable market is going to be incredibly important to thrive (or survive) in this increasingly competitive and fragmented industry.