Services & Pricing

The Biggest Secret to Change Legal Pricing

Get ready to gasp. I list all my prices on my website. (Gasp!) Yep, it’s all there for everyone to see – from the individual costs for discrete tasks to estimator tools for potential clients to use to see what their case might cost if they hire me to do everything.

This idea of providing upfront pricing is uncommon, and sometimes sacrilegious, among lawyers. We’re so ingrained to hide the ball (thanks, law school) that even putting something as basic as your hourly rate on your website is unheard of.

In what other industry is hiding the price acceptable? As my friend Jessica talked about in a recent article, when you book a flight, the airline company doesn’t tell you, “We’ll give you the bill when you land,” or says, “The total cost depends on a number of factors but usually falls in the range of $1,000 to $10,000”. If they said that, you wouldn’t book that flight. You’d move on to the next provider that said, “A flight to New York will be $400.”

And yet, we as lawyers do this all the time. We excuse our behavior as to why we can’t be upfront and predictable when it comes to pricing. We say it’s things like:

Variables. There are too many variables to be able to determine a predictable cost or even provide a reasonable range. I get that each case is different, but after several years of practicing, you’re saying you can’t define and better estimate variables? What’s all that time-tracking doing for you? Airline companies deal with variables every day, many of which are out of their control, and on thousands of flights; and yet, when you buy a plane ticket, you get a predictable, transparent price. If they can do it, so can we.

Antitrust. The excuse goes that if lawyers put pricing in a place that can be seen by other lawyers, we will all be sued for antitrust because somehow that means we are working together to control prices. When Wal-Mart searches to see what Target sells a bottle of shampoo for, but they aren’t violating antitrust laws. Heck, many bar associations do this search for us and publish a yearly economic survey showing the average hourly rate charged in different demographics. Many lawyers use that data to set their own rate. How is seeing what colleagues charge in a survey any different than seeing what other folks charge because it’s posted on their websites? It’s that just basic capitalism and market competition at work?

It’s just how we do it. Although the billable hour feels like it’s been around forever, it’s a fairly new concept that really took off in the 1970s. Abraham Lincoln and Thurgood Marshall were not charging a consultation fee before they would tell a prospect their rate and sending invoices out each month. While the unpredictable, often opaque billable hour system worked well in the past, the truth is, the market is pushing back. Because we seem to be the only industry that still operates this way, consumers are demanding a different approach. Working with a service provider who says, “Keep giving me money until I say we’re done” isn’t going to fly much longer. Although we’re not a profession quick to change, if we don’t redirect soon, we likely won’t have clients much longer to send invoices to.

To be clear, I’m not just standing on a soapbox here. I practice what I preach. I’ve seen the effects first hand when prospects are given predictable, transparent pricing. Clients are happy. My collection rate is 100%. I don’t defend or discount my bills.

It’s time we let go of the excuses and do the work to create predictable, transparent pricing. Show off what you got! Put it out there for the world to see! You might be amazed at the results.

What information about pricing is currently on your website or marketing materials? How specific and transparent is it? What changes can you make to increase pricing predictability?