CPC, CPM, CTR … the advertising business has no shortage of acronyms. In this article, we’ll clarify the jargon and explain how understanding these key metrics help business owners understand their marketing performance and identify possible opportunities. The eight metrics we break down below are ones every legal marketer should know. We’ll also introduce less-monitored metrics that make a huge impact on lead generation.
Here it goes, starting with our favorites: quality leads, return on ad spend, cost per lead, and the two conversion ratios.
Key performance indicators are four legal marketing metrics tied to your bottom line. The four KPIs together form the north star of any legal advertising campaign. They’ll quantify the exact impact of your investment—in both the number of new clients and in predicted settlement value. And, they’ll help you work back from the goals and estimate how much you’ll need to spend on advertising to fill your pipeline and give each of your attorneys an ideal number of cases.
Leads are simultaneously the most obvious metric on our list and the most contested. Every law firm knows they need a healthy funnel of leads, but the definition of a lead can vary greatly.
In the purest sense, a lead is anyone who “raises their hand” by virtue of contacting your firm or leaving their information with a request for you to follow them. So, someone who calls your office, fills out a “Contact Us” form, or hands you their business card with a request to follow back up with them would be a lead.
Someone that clicks on your ad, visits your website, and leaves without contacting your firm or asking to be contacted is not considered a lead—as you have no means of identifying who they are and reaching back out (besides through pixel-based remarketing).
There’s a big difference between low-quality leads and high-quality leads, and you don’t want to optimize your campaigns for the wrong type. A low-quality lead is unlikely to become a client. Maybe they were looking for a family lawyer but you specialize in criminal law cases; or, maybe the email they leave bounces or the phone number they used is now disconnected. Either way, low-quality leads do little more than take up your firm’s time.
On the other hand, a high-quality lead has intent. The person did their due diligence to speak with an experienced attorney.
In campaigns we have reviewed, it seems that pressure to deliver results leads some agencies to inflate the list of leads they bring in:
Combine this with the rise of ad fraud, bots, competitors clicking you out of business, and sales people clicking on your ads, and filtering high-quality leads from the rest can be an uphill battle—which is why it’s important to reach a consensus with your marketing team or agency early on to decide what should and shouldn’t qualify as a lead.
We generally recommend going over the following:
And if they change the subject and talk about clicks and impressions, walk away and don’t look back.
The holy grail of any campaign, return on ad spend (ROAS) shows you the revenue generated by each dollar invested in advertising. A ROAS of 300%, for example, tells you that you can expect $3 in revenue from every $1 spent on ads.
The formula for calculating ROAS is simple enough: Take the revenue attributed to your marketing campaigns and divide by the total amount you spent on those campaigns over the same time period.
Back into the individual variables is a different story. The denominator can be quickly pulled from Google Ads or aggregated across multiple ad accounts, but the numerator will take a few more steps and the right analytics infrastructure.
As for calculating the revenue for the numerator, there’s an easy way and a hard way. The easy way is to take an educated guess at the revenue or contingency fees generated from your firm’s average client. For easy math, let’s say $10,000. Next, you want to take a similar guess at how likely the average lead is to convert into a signed client and ultimately a winning lawsuit (a field referred to as Opportunity Probability in Salesforce and most major CRMs). Let’s put this at 5%, assuming your firm turns away a number of cases that aren’t a good fit and a few prospective clients decide not to pursue a case.
Multiply these two numbers, and you know what each lead is worth to you:
And to find your predicted revenue, you’d then multiply the average lead value by the number of leads your marketing campaign generated over a period of time (let’s say 100). This puts you at an expected 100 leads x $500 revenue per lead, or $50,000.
If you spent $10,000 over one month in ads to bring in these leads, you’re then looking at a 500% return on your advertising spend.
For a more granular look at this metric, you can calculate separate probabilities and values for different types of cases or locations. If you know that your average slip-and-fall case nets $5,000 in fees with a 20% probability of becoming a winning lawsuit, while your average medical malpractice case brings in a whopping $100,000 with a 5% probability, you can compare the ROAS to make a more informed decision about where to allocate your marketing dollars.
In this scenario, a malpractice lead brings in 60% more revenue than a slip-and-fall lead, so it makes sense to prioritize those leads in your marketing as long as the Cost Per Lead for a medical malpractice case is no more than 10x higher than the Cost Per Lead for a slip-and-fall. In this example, it costs 3x more to acquire a high-value malpractice lead, but it’s money well spent in the end.
While ROAS is great as a high-level performance indicator, it can be slow to adjust for ongoing optimizations and less meaningful when it comes to driving day-to-day marketing decisions. For this, you need cost per lead (CPL).
Note some marketing products such as Google LSA have a pay per lead model built in, while users can not adjust for negatives, languages, demographics, (so hard to optimize performance over time) the cost per lead system allows for predictable cost per lead as soon as the campaign is set up.
CPL is a measurement of how much, on average, you spend to acquire a single lead. To get it, divide your marketing spend over a certain time period (let’s say $5,000 over one month) over the number of leads that campaign generated in the same window (say, 40). Plug in the numbers, and you’ll find that each lead costs you $125.
So, what can you do with this knowledge?
For starters, you can measure incremental campaign performance. If you were averaging a CPL of $125, but that new ad group you rolled out brought this month’s CPL down to $100, you know it was worth it. Inversely, if you were happy with $125 and wanted to invest more in advertising to add fuel to the fire but ended up with a CPL of $150, you’d know that you’re experiencing diminishing returns and may be reaching market saturation.
It can also be useful for comparing results across campaigns and audiences: If you see a lower CPL on Google Ads than you do on Facebook Ads, it might be smart to shift budgets away from Facebook and toward Google.
If you’re evaluating agencies or in-house marketing hires, it’s a good idea to drill them on their knowledge of Cost Per Lead – and projected close rate or ROI from a lead category. Make sure both parties reach an agreement of how a lead is defined and have a plan for measuring and improving CPL.
We’ve found in some practice areas leads can be developed at a fraction of keyword bidding on google, but close at a much lower rate of the Google leads. If you have an intake team that can handle the volume still get a positive ROI from volume and measurement in place, less expensive, harder to close leads can still have a positive ROI.
Next up is a two-part metric that can inform you of (a) whether or not you’re targeting the right audience, and (b) whether or not your messaging resonates with that audience.
The first conversion ratio is the leads-to-clicks ratio, which tells you how many paid clicks it takes to acquire a single lead. If you pay for 50 clicks and get five leads, you’re looking at a 10% conversion.
We like to see this ratio somewhere between 10-15%, but it can vary significantly by focus area and channel strategy. If you see something significantly lower, it’s a sign that something’s not working—maybe you’re targeting a low-intent audience, bringing in the wrong case types, or your messaging isn’t compelling or actionable enough to get the visitor to fill out a form or pick up the phone.
One example was a law firm we audited with a sitewide conversion rate at 6.5%. We were able to locate informational pages such as install a car seat, that was driving a large % of site traffic, had no intent. We recommended updating content and adjusting the link flow through the site,—but for paid ads, these low intent or DIY visitors may need to be excluded or offered a different type of call to action to be engaged.
The second conversion ratio is the clients-to-leads ratio, which tells you how many leads it takes to sign a client. If you capture ten leads and sign one client, you’d have a 10% conversion.
This metric is harder to benchmark, and some firms are very selective about the clients they take and target an intentionally low conversion rate, but it can generally tell you how good your firm is at converting a lead. This is especially important to know if you funnel your leads through a call center or you have multiple people in your intake staff or various attorneys in the office that do the initial consultation, as it can help you assess their performance.
Combining these two metrics will let you work back from a goal. If your goal is to sign 200 clients a year and you have a 10% leads-to-clicks ratio and a 25% sign-ups-to-leads ratio, you can expect to budget for 8,000 clicks to build a large enough funnel.
With all the marketing metrics out there, it’s easy to get caught up on clicks, impressions, and click-through rate and lose sight of what really drives your pipeline growth. We hope this post helps you stay on track by covering what our campaign managers look at every day for our full-service clients.
In addition to the four revenue-focused metrics covered above that offer a high-level assessment of how your campaigns are performing, in terms of both qualified leads and revenue, there are additional important metrics that are not often asked about. These are: impression share, average position, cost per click, and engagement.
Individually, they mean very little. But, combined with performance metrics like those listed above, they’ll help illuminate the path to improvement.
These are the tactical metrics that marketers can easily test, control, and manipulate—and we’ll walk you through just how to do that with a few experiments we’ve seen make all the difference for our legal clients.
Search impression share measures how often your ad appeared for a given keyword, ad group, or campaign. An impression share of 50%, for example, means you’re successfully reaching for 50% of the potential clients searching for your keywords on Google.
Like all of the metrics covered this week, there’s no right or wrong impression share. 10% is not necessarily bad, and 100% is not necessarily good.
Instead, it indicates opportunity.
But before we get into how to interpret impression share, let’s go over a few of the reasons why impression share might be on the low side:
Again, it’s perfectly acceptable to have a low impression share (and it might even be more worrying if the share was >90%, as that could mean you’re overbidding).
Here’s what it means instead:
Your ad’s average position shows how prominently Google features your ad. An average position of 1.4 means your ad typically appears at the top of the first search results page, therefore capturing the largest audience. If your average position is 4.7, your ad likely appears on either the bottom of the first page or the second page, meaning searchers will only see it if they scroll past the first few ads and the first 10 organic listings.
But, just as we saw with impression share, there’s no ideal average position. Sure, it would be nice to be the first result a potential client sees, but this coveted spot goes to the highest bidder and could cost double the price of a lower position.
So how do you use it?
Like with impression share, average position shows you how competitive your ad is for different keywords you care about.
If there’s a list of keywords you really care about (and are willing to pay a premium for), you can target a higher average position to ensure that your ad gets seen. This strategy is particularly effective for high-value cases with a low search volume. If only 30 searches per month for a certain defective medical device, you probably want to do everything you can to get in front of all 30.
Example: for low volume searches, the other strategy we use is to include a broader range of keywords, such as information seeking keywords, or implied intent keywords. For hip implants, hip recall/revision attorneys had a very low search rate. So we targeted injury from metal depree from faulty hip … the informational question could be answered for 25% of the cost.
Similarly, “car accident lawyer” expensive to be #1, but bidding on a question such “who is at fault when a car is hit from behind, implies the person in this situation would need a lawyer, but can get more clicks/higher for the same budget.
It can also be a good strategy to ensure that your ad always comes up first when someone searches for your firm’s name. Lawyers are notoriously competitive, and you can bet that at least a few rival firms are bidding on your name in hopes of nabbing some of your leads. Beat them to the punch by securing the first position.
You also may be eligible for a newer kind of ad that can give you a unique, favorable placement among your competitors. Google is now allowing certain law practices to use Local Service ads (LSAs), which show up at the top of search results on both desktop and mobile, above pay-per-click ads, Google Maps 3-pack, and organic results. LSAs are separate from Google ads – so you can have both types of campaigns simultaneously – and with LSAs, you’ll only be charged when contact is made by a new lead.
There are many tricks and techniques firms can utilize to improve their position in search. Speaking with a skilled marketing agency is a great way to find new opportunities.
Is it better to get 20 semi-targeted clicks for your budget, or just one very targeted click?
It’s a question that has the legal marketing world divided—and one that you’ll only be able to answer through testing both strategies.
Each keyword (each click) comes at a different price, as determined by a real-time bidding mechanism in which Google allocates limited ad inventory to the highest bidder. Keywords like “best auto accident attorney” or “mesothelioma lawyer” are considered extremely competitive as countless law firms are willing to pay top dollar for a slice of the potential settlement. In contrast, broader keywords like “legal help” are less competitive and less expensive, as fewer firms are bidding on such an ambiguous search query.
To make the most of cost per click, compare your conversion and cost per lead across two distinct campaigns: one targeting generic keywords at a low cost per click and one targeting specific, high-intent keywords at a higher cost per click.
If you see a $200 cost per lead from the low-CPC campaign and a $70 cost per lead from the high-CPC campaign, then you’ll know that the premium keywords were worth the price. Or, if it’s the other way around, then it might be a better strategy to “cast a wide net” and optimize for clicks.
EXAMPLE: For one client we were contacted to do an audit for, the vendor had bid on “non injury truck accident”, which had a lower cost per click, and even lowered the firm’s cost per lead. However, the lead was a non-injury, so the chance this could be pursued was very low. The best approach was to target keywords that people looking for their type of legal representation might be searching for, rather than ones we know they wouldn’t be.
Some management companies bid on overly general terms, without developing a robust list of negatives, meaning phrases or words to exclude from a campaign. One client, an attorney looking for medical malpractice cases, had been spending the firm’s budget on the general term ”malpractice attorney,” which seems to make sense at first glance. However, the firm did not include negatives for the types of law that they didn’t cover, such as legal malpractice and dental malpractice. With a little tightening of the criteria for malpractice-related keywords, we were able to bring in more leads that were related to medical malpractice specifically. We also set our client up to bid on lower volume/high intent keywords to increase opportunities to be in front of the firm’s target client.
This next one’s more of an umbrella than an individual metric. Engagement refers to the actions your visitors take after they click on an ad. An engaged customer spends a few minutes on your site and clicks around to view multiple pages. An unengaged customer leaves after a few seconds.
To understand engagement, open up Google Analytics or your analytics tool of choice and look at individual indicators like:
These metrics together help you assess how well your ad and website resonate with your visitors.
If visitors leave your site after a few seconds, then something’s not working. You could be bidding on the wrong keywords, where visitors could come in looking for something that you don’t offer. You could be bringing in the wrong traffic, where visitors feel like they’re not part of your target audience. Or there could be a disconnect between the ad and the website, where visitors click an ad for ‘auto accident lawyers’ and then land on a page with no mention of auto accidents.
Or, your biggest problem could actually be the load time of your website. It’s a known fact that the slower a page’s load time is, the more people only visit one page, which reduces conversions and impacts SEO. One of our clients initially contacted us with a WordPress website that was lacking in performance. Our team successfully migrated the firm’s website to a higher quality host provider – a move we typically recommend when it can decrease load times by 25 percent or more with a platform upgrade. We also fixed coding errors, which shortened the load time by 88 percent.
If visitors stay more than a minute and view multiple pages, then you can rest assured that you’re bringing in the right audience and have a message that resonates with them.
To make the best use of this metric, track all of your ads with identifying information (UTM codes). This information can then be queried by your analytics tool to show you how engagement compares from one campaign to another.
Law firms can almost always get cheaper traffic from display or social advertising channels, but the traffic is typically lower quality than search traffic. Looking at engagement metrics will give you a good proxy for measuring the quality of your visitors.
A remedy for lower engagement rate may be to:
And there you have it — the top key performance indicators and top opportunity indicators. These marketing metrics offer both a high-level overview of your campaigns and the actionable insights needed to optimize their performance. If you’re interested in getting more leads – and clients – for your firm, we welcome you to contact Envoca for a free marketing audit today.