Professional services
Law Practice Marketing Budget Calculator
Sets a marketing budget, where legal advertising is a regulated activity.
Result
Business arithmetic for running a practice, not legal advice. Fee agreements, contingency limits, trust accounting and advertising are all governed by the rules of professional conduct where you practise, and several are strict. Check the applicable rules before any of this affects a client agreement or a marketing decision. Legal advertising is regulated by the rules of professional conduct: claims about results, testimonials, specialisation and referral arrangements are all restricted and the restrictions vary by jurisdiction. Fee sharing with non-lawyers is prohibited in most places, which rules out several common marketing arrangements.
Get a Free Business AuditHow the calculation works
A share of revenue, split across channels, with the cost per client and cost per matter the spend implies at your conversion rates. Working backwards from the matters needed and the conversion rate gives a budget that relates to a target rather than a percentage chosen by convention.
What moves the number
- Matters needed and the conversion rate from enquiry.
- Practice area, since acquisition cost varies enormously by area.
- Referral share, which is strong in legal services and costs little.
- Lifetime value, where the matter type repeats or refers.
Where this one goes wrong
Lawyer advertising is governed by the conduct rules your state has adopted, which restrict claims about results, require certain disclosures, limit solicitation of prospective clients and in some states require retention or review of advertising. Those rules bind the content of the marketing regardless of the budget, and a campaign that works commercially and breaches them is a disciplinary matter. On the economics, acquisition cost varies by practice area more than almost any other business, so benchmarks across areas are not useful.
Before you quote
- Check your state's advertising and solicitation rules before the campaign.
- Work the budget back from matters needed and conversion rate.
- Measure cost per matter by practice area, not blended.
Where the rules come from
Questions
About this calculator
Are there rules on lawyer advertising?
Yes, in every state. The rules restrict claims about results, require disclosures, limit direct solicitation of prospective clients, and in some states require advertising to be retained or reviewed. They bind content regardless of budget, so check your state's version before running anything.
What should a law practice spend on marketing?
Work it back from matters needed and the conversion rate rather than from a percentage. Acquisition cost varies by practice area more than in almost any other business, so a figure that is right for one area can be wildly wrong for another.
Is referral work worth cultivating?
Heavily, since it costs little to acquire and converts far better than advertising. Referrals from other lawyers and from past clients are the backbone of most profitable practices, though fee-sharing arrangements have their own conduct rules worth checking.
The formula
budget = revenue x share; cost per matter = budget / matters won; ceiling = a share of gross profit per matter
Put this calculator on your site
Free to embed. Paste this where you want it to appear. It stays up to date automatically because it loads from BDEVY.
Please keep the attribution line. It is the only thing we ask in return.
How to use this calculator
- Annual revenue ($). Enter your own figure; the page starts at $420,000.
- Marketing as a share of revenue (%). Enter your own figure; the page starts at 6%.
- Average fee per matter ($). Enter your own figure; the page starts at $6,500.
- Margin on a matter (%). Enter your own figure; the page starts at 45%.
- Enquiries per month. Enter your own figure; the page starts at 32.
- Enquiries that become matters (%). Enter your own figure; the page starts at 28%.
The result updates as you type, so you can try a figure, see what it does to most to spend acquiring a matter, and change it back. Nothing you enter is sent anywhere or saved.
A worked example
These are the figures the calculator opens with. Every number in the results column below is produced by the same calculation the page runs, so you can follow it through before putting your own figures in.
What goes in
| Input | Value |
|---|---|
| Annual revenue | $420,000 |
| Marketing as a share of revenue | 6% |
| Average fee per matter | $6,500 |
| Margin on a matter | 45% |
| Enquiries per month | 32 |
| Enquiries that become matters | 28% |
What comes out
| Result | Value |
|---|---|
| Most to spend acquiring a matter main result | $1,024 |
| Annual marketing budget | $25,200 |
| Matters from this enquiry flow | 107 |
| Current cost per matter | $234.37 |
| Cost per enquiry | $65.63 |
A 6 budget is $25,200 a year, producing 107 matters at $234.37 each. On the margin per matter, spending beyond $1,024 to acquire one stops being worthwhile.
How sensitive the answer is
Holding everything else steady and changing only annual revenue, this is what happens to most to spend acquiring a matter. It is worth knowing which of your inputs the answer actually hinges on, and which barely move it.
| Annual revenue ($) | Most to spend acquiring a matter |
|---|---|
| $210,000 | $1,024 |
| $315,000 | $1,024 |
| $420,000 example above | $1,024 |
| $630,000 | $1,024 |
| $840,000 | $1,024 |
Every other input is held at the example value while this one changes, which is not how a real job behaves. Treat it as a guide to which number matters most, not as five separate quotes.
What each figure means
- Annual revenue ($)
- A money amount, starting at $420,000.
- Marketing as a share of revenue (%)
- A percentage, between 0 and 25, starting at 6%.
- Average fee per matter ($)
- A money amount, starting at $6,500.
- Margin on a matter (%)
- A percentage, between 0 and 90, starting at 45%.
- Enquiries per month
- A number, between 0 and 5000, starting at 32.
- Enquiries that become matters (%)
- A percentage, between 0 and 100, starting at 28%.
What the results tell you
| Result | What it is |
|---|---|
| Most to spend acquiring a matter | The headline result. A money figure. |
| Annual marketing budget | A money figure. |
| Matters from this enquiry flow | A number. |
| Current cost per matter | A money figure. |
| Cost per enquiry | A money figure. |
Keep going
Related calculators
Estimating is the easy part
The jobs you never hear about cost more than the ones you mis-measure. BDEVY builds the marketing, systems and automation that bring them in.