Is your price right?

Brent Szalay

The lack of transparency in time-based billing can make your clients apprehensive about engaging your advice, with little certainty of your final bill. They may be anxious and fearful they will be over charged. Is that the way to start a quality relationship? Surely there’s a better way for clients and your practice to achieve a great experience and outcome. I asked pricing expert Liz Harris (lawyer and director at Ovid Consulting).

Working as a litigator on disputes between lawyers and their clients Ms Harris discovered that time billing was often a key culprit of damaged relationships. The problem-solver in her sensed an opportunity to specialise in alternative and value- based pricing strategies – to help lawyers avoid disputes by changing their management style to foster trusted relationships. That’s where her consulting business Ovid began.

Before rolling up your sleeves, Ms Harris suggests shifting your inherited focus away from “inputs” to work closely with your clients to try and unearth their ultimate desired outcome. Forget how many six-minute units your team has recorded. “It’s about sitting down together (with your client) and unveiling: What are you trying to achieve? How are you trying to achieve it? Then providing options for how your service can be delivered to meet those objectives.”

Only then can you truly visualise where both the tangible and emotional value lies in the service experience you provide. This knowledge can then influence how you proceed with pricing. It’s similar to a doctor’s approach – slow down the diagnosis process to ensure that the treatment (work) is effective.

What represents ‘value’ for a client?

It depends, says Ms Harris. Each client is unique, and in some cases, clients can be unaware of what they want to achieve and the value they’ll gain from your work. They need your expertise to help ascertain it.

Value pricing is ideally suited to align your advice with their outcome goals, which can include:

Receiving support: “Some clients can simply be looking for someone in their corner. Particularly in family law, clients want their lawyer to walk
the journey with them and provide peace of mind through the process.”

Realising goals: “Consider conveyancing. For many people, purchasing their home is the biggest financial decision they’re going to make. Helping someone achieve their dream is a significant milestone.”

Navigating emotions: “When it comes to wills and estates, clients want to know that after they’ve passed, their family will be looked after, that their loved ones will be guided with compassion and care.”

Avoiding resource drain: “Businesses want to minimise the impact on their people and productivity. Experienced litigators will ask: What’s the value of your employees avoiding cross- examination? Every time you see an email from us, what’s the stress value there?”

One of Ms Harris’ key pricing rules is to slow down and invest time to scope the work and your client’s expectations. Another rule is to ensure that you and your client are a “match,” ie, share the same values so you can meet their expectations and they respect your professionalism. Not every client is the right fit for the way you work. And that’s OK.

From there, look to establish internal processes that incorporate questionnaires and pre-interviews, to help your client clarify their wants, needs and expectations. Not only will this overhauled approach set upfront expectations for what they can expect as an outcome, but the more personalised experience will also boost the chances of them returning or referring work your way.

Join the SEIVA/LIV pricing strategy webinar on 18 November. Alternative and value-based pricing models, as well as how to adopt your preferred method as a key revamp to your strategy will be discussed. Visit LIV website for details.

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