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How do I Calculate the Value of a Lead?

With traditional means of advertising, including but not limited to radio, billboards, and television, becoming less effective, it is imperative that lawyers expand their marketing strategies in order to grow their business to its full potential. When an attorney knows how each of their advertising campaigns performed, and why it performed in the manner it did, they will be able to know what mistakes to fix, and therefore make sure such mistakes are not repeated during their next campaign. One of the best marketing tips for lawyers involves calculating the value (or cost) per lead. This in turn will help the lawyer understand whether their techniques for bringing in business are working or not. How do I calculate the value of a lead? This article aims to provide a basic breakdown of such a task.

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What is Cost Per Lead?

‘Cost per lead’ or ‘cost per client’ is a specific calculation that can be made to help understand the value of a lead. It is a common metric used and one of many marketing tips for lawyers. It is important to note that the cost per lead is not exactly equal to the value of a lead. This will be discussed further below. In order to calculate this metric, there are two variables you will need: your firm’s marketing budget & the amount of leads your firm has acquired over a period of time using the budget.

Cost per lead = marketing budget / # of new leads.

Therefore, if for example, you’ve spent $1,000.00 on marketing and it acquired you 5 new leads, your cost per lead will equal $200.00. Now, as a partner of your law firm business, you will know that each newly acquired client will need to bring in more than $200.00 in order for such marketing efforts to be profitable.

Other Important Metrics to Help Determine Value

There are numerous other valuable marketing tips for lawyers in regards to analyzing how much value a client brings. One of these metrics is called ‘value per case’, which is calculated by dividing the total gross sales generated by the total number of cases that have been completed within a specific period of time. Another one of these is called return on investment. This is essentially a percentage, calculated by dividing how much money you’ve spent on a specific lead divided by how much money that specific lead has brought into the firm.

It is important to note that these other metrics are there to help aid the cost per lead calculation (above). Altogether, these calculations will determine a certain amount of value per lead. For example, your cost per lead may be $200.00, however, if most leads themselves bring in other leads through referral, then the value per lead will greatly outweigh the cost. These marketing tips for lawyers are beneficial to both the general business knowledge of the lawyer, as well as the overall growth of the law firm.

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Resource Guide

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Advertising For Attorneys
- 6 Ways To Boost Your Law Firm’s Client List
Attorney Marketing Strategies
- Strategies For Lead Generation
Bankruptcy Leads For Lawyers
- Generating Bankruptcy Leads for Lawyers
Best Legal Leads For Attorneys
Best Legal Leads For Lawyers
Best Mass Tort Leads For Law Firms
Best Mass Tort Marketing Firm
How To Attract Clients As A Lawyer
- 3 Powerful Strategies
How To Promote Your Law Firm
Law Firm Marketing Strategies
- The (Not-So) Best Law Firm Advertising Examples
Lead Generation For Lawyers
- Best Lead Generation for Lawyers
- The End of Third-Party Cookies: Lawyers And Their Marketing Strategy
Legal Leads For Attorneys
Legal Leads For Lawyers
- Generating Legal Leads For Lawyers
Marketing Tips For Lawyers
- How do I Calculate the Value of a Lead?
- Improving your Marketing Results
Mass Action Leads
Mass Tort Leads For Law Firms
Motor Vehicle Accident Leads For Attorneys
Motor Vehicle Accident Leads For Lawyers
Social Security Disability Leads For Lawyers