Back in March of this year I blogged that loyalty programs were likely an under-utilised means by which Australian law firms could differentiate themselves in a highly competitive legal market. I was, then, particularly happy to see that recently Australian Government Business (www.business.gov.au) blogged  on a similar issue – ‘Customer loyalty or reward programs‘ – which looked at, among other things:

• What customer loyalty programs are.
• The benefits and risks of a customer loyalty program.
• Tips when implementing a customer loyalty program.
• Legal and compliance issues for customer loyalty programs.

A lot of which is directly relevant to law firms looking to implement a customer loyalty program.

Why you should think of implementing a customer loyalty program in your firm

As far as law firms are concerned, the perennial question has been:

How do we make sure that our customers [clients] understand the benefits of being exclusive to our brand?

Here, while we have known for a long time now that the ‘customer experience‘ has been the bedrock of customer loyalty, it has only been in recent times that we have been able to show that loyalty programs can, and do, add to this overall customer experience.

But customer experience isn’t the only reason why law firms need to think carefully about implementing a loyalty program. Other benefits include:

• gaining a better understanding of the customer buying behaviour – which practice groups are they using, when, how often, why? Are they using more than one partner in a practice group or the same partner?
• increase you brand recognition within your existing customer base – putting in place a formal loyalty program should go some way to helping you promote you law firm internally within your client’s business; if for no other reason than water-cooler chat.
• increase your word of mouth referrals.
• provides an added incentive for clients to give you work rather than a like skilled and experienced firm (i.e., all things being equal).
• can be used to help recognise referrers to the firm – if you include referrers in the program, all things being equal they will more likely refer clients to your firm than a competitor.
• it can help you implement formal and informal customer listening and feedback programs (as part of the program offering).
• it will help members of your firm get to know who your key customers are and what they do.
• it should provide your firm with a platform to cross pollenate into other service areas without looking like a hard sell.

You could also find that putting a customer loyalty program in place leads to greater use of your much underutilised CRM systems!

All that said, a word of caution for those who are intending to implement a customer loyalty program in their firm:

• customer loyalty marketing must start with the law firm demonstrating loyalty to the client. Much like the trust it is built on, you cannot expect loyalty from your client if you are unwilling to offer the same type of loyalty to your client,
• the foundation of a customer loyalty program is a promise. If for any reason whatsoever you are unable to fulfil on that promise, then you shouldn’t implement the program, and
• always keep in mind that while the lawyer inevitably gets the credit when things go well, it is the brand that gets the blame when things go wrong – so make sure that at the heart of you customer loyalty program is always a dialogue between you and your client.

Get it right though and a well implemented and executed customer loyalty program could be just he thing your firm need in order to differentiate itself from the market.