Most Law Firms Fail to Measure Success of Their Client Retention Efforts, According to New Study by LexisNexis

Insufficient tracking of retention and lack of attorney buy-in count among key reasons for mediocre results

New Providence, N.J. - November 13, 2006 – While all large law firms in a recent survey indicated that they use client retention initiatives, 61% of them don't know their client retention rate, according to a newly released study report from LexisNexis, a leading provider of client development solutions for the legal profession.

"The Large Law Firm Client Retention Study" was based on a survey of 2,198 professionals at law firms in the U.S. and Canada with more than 75 attorneys. The full report is available for download at http://www.interaction.com/go/clientretention/.

Among its significant findings, the study revealed that formal client satisfaction measuring is rarely done with any meaningful frequency. More than one-third (35%) of law firm respondents said they do not measure client satisfaction at all, and among those who do some regular monitoring, 33% said they only measure client satisfaction every two years or more. This lack of formal and regular client satisfaction tracking may help to explain why nearly half of clients terminate some of their law firms annually.

The study also probed for explanations as to why so many large law firms struggle with implementing pro-active and strategic client retention initiatives. The leading systematic reason identified by study participants was the lack of participation from attorneys and support staff (67%). This non-compliance could be due in part to a misalignment between compensation practices and firms' client retention initiatives. More than half of firms surveyed (51%) do not compensate their attorneys for client retention and, of the firms that do provide some financial reward system, only 14% compensate based on the firm performance level.

"It's a common marketing axiom in the professional services business that keeping a client is easier and less expensive than landing a new one," said David Sosnow, director of consulting services for LexisNexis. "The results of our study illustrate that with proper strategic advice, training and implementation support in client retention, law firms now have a great opportunity to protect their client base and market share."

The study results and their implications for law firm client retention initiatives will be the subject of a teleconference hosted by LexisNexis Mealey's on December 6th. For more information or to register for this special program, please call 1-800-MEALEYS or go to http://www.lexisnexis.com/conferences/LegalConference.aspx?cid=58949.