The Case of Personal Injury Firms
According to banks and economists, the U.S. economy is in a recession. The rule of thumb definition for a recession is two consecutive quarters of negative GDP growth. Factors like the lasting effects of the coronavirus pandemic and Russia’s invasion of Ukraine are raising concerns for both consumers and businesses alike. However, despite the negative economic indicators, a recession can be a pivotal moment for law firms to grow.
Specific branches in law, e.g., personal injury firms, are already seeing the effects of today’s inflation. But that does not mean the situation is hopeless! Regardless of inflationary changes and gas prices soaring to an all-time high of $4.57 per gallon nationwide, for example, studies have shown that Americans continue to spend heartily. This is a clue that it is essential to look at the economic situation from different perspectives. (A more in-depth case study on personal injury marketing is provided in the following section.)
Despite the rising gas prices and current talk about a coming recession the job market and consumer spending remain constant, which also supports long-term rather than short-term thinking about it. Here’s an example of what we mean:
During the recession between 2007 – 2009, known as the Great Recession, some big companies, notably Amazon, surprisingly continued marketing efforts when most companies decided not to. Wall Street analysts were stunned when Amazon’s sales rose 68% in the midst of the recession. Not only did Amazon continue marketing, but they also went so far as to launch the first of the now ubiquitous Kindle! This is the power of thinking long-term.
So, what can law firms learn from businesses like Amazon?
History has taught us that marketing during economic slumps can be incredibly beneficial. It means signaling to your prospects, ‘Hey, I’m here to help, come rain or shine.’ Just like Amazon did back in 2009, firms can stay top of mind through constant exposure and coverage.
Hold that thought, and find out how other firms have remained recession-resistant, and how you can, too.
Marketing During the Great Recession
Before delving into specifics, understand that although economic declines can instill fear, it’s the right time to think about ways you can innovate.
Economists still don’t yet know which type of credit stagnation we will ultimately be dealing with, but historically speaking, there are 3 types of economic declines:
However, it does not really matter which type of slowdown we’re headed toward because marketing is known to have helped businesses ease the effects of a recession in 2 ways:
- It softens the depth of the downturn by lessening the degree to which your firm’s business slows down.
- It reduces the lasting effects of the recession by accelerating growth once the economy gets past the downturn.
To see recession marketing in action, it’s educational to look at the case of personal injury firms.
How Personal Injury Firms Remain Recession Resistant
For many, economic decline signals blockages. Paradoxically, it can be the most exciting time for law firms. Let’s look at the case of personal injury firms.
Generally speaking, consumption tends to fall flat in a recession. For personal injury firms focusing on automobile accidents, it may appear to signal a crisis primarily because the price consumers pay at the pump for gasoline may spark a decrease in driving. However, soaring gas prices do not necessarily signal that personal injury firms‘ businesses will slow down. Here’s why:
In the United States, gas falls under necessity goods because car culture is a staple in American culture. There are many reasons why this is true, but one of the reasons is that public transportation is still limited or unavailable for many.
This was the case during the Great Recession, and this is still the case today. See how gas consumption remained steady during the 2007-2009 crisis:
How law firms find their way through economic downturns
So the demand for gas remains constant, but how did law firms really do during 2007 – 2009? Here’s a closer look:
Plaintiff Magazine reported the case of a single attorney’s growth during this time. Jonathan G. Stein, a solo practitioner, handled personal injury and mortgage defense cases and increased his caseload by 25% over 2008, in the middle of the economic downturn. When asked what helped him thrive during this time, he attributed his growth to the following:
- The increased number of people seeking legal help; he recognized business did not stop even during the worst economic crises.
- The public still sought him out for more minor legal matters, and he was there to help.
- Last but not least, he improved his marketing plan.
His is not the only firm to leverage marketing during times of crisis. We compared four of our law firm clients who continuously marketed during the recession and more recent global issues like the pandemic. These law firms continued to have steady traffic throughout the years:
Not only did traffic increase for these firms, but research also shows that the companies that kept advertising during times of crisis actually increased their sales and market share during and after the recession.
Conversely, 60% of the businesses that decided to ‘go dark’ during 2007-2009 saw their brand use decrease by 24% and brand image decrease by 28%. Often, these businesses come out of the downturn scrambling to get to where they were before, which takes a great deal of work to be successful.
So, what are the marketing differentiators that the most successful firms adopt?
The Top Marketing Practices for Building Recession-Resistant Law Firms
The most successful law firms mix and match their digital marketing according to their needs. However, there are some standard best practices:
Invest in the right technology to reach your customers where they are
In our LAWsome podcast, “How Clients Find/Hire Firms In A Post—COVID World,” we discussed how consumers are more discerning today than in the past. Because potential clients are likely to be looking at 12-14 different sources, it’s critical for firms to be where they are searching.
Download our FREE checklist and find the top actionable steps to remain recession resistant
Firms can emerge stronger than ever.
Remember: the recession can be a pivotal moment for your law firm to grow.
When the economy starts to go south, it can be tempting to take immediate action and cut your digital budget. Still, history has taught us that those that remained consistent with their marketing during a recession greatly benefited from delayed gratification. We saw this play out for personal injury firms and solo practitioners in 2007-2009.
Although each business will weather crises differently, how do you want to weather yours? We can help ensure your firm’s image is one of strength and leadership.