How To Adopt Subscription Pricing

Pricing is a sensitive subject. We aren't going to go into the actual rate of compensation for legal services as it varies widely depending on the area of law and the geographic location. Our focus here is to consider the subscription pricing model and how it is used to meet client requests. In fact, clients are increasingly wanting some way to manage their budget for legal needs. The trick here is to know your practice and processes to offer this client-requested model. 

Know Your Practice

This is the first and likely the most important step. To adopt subscription pricing, it's critical to understand how your firm works. Do you have several 'standard' processes? Or is every case unique? Obviously, some areas of law, like personal injury, don't lend themselves to a subscription pricing model. 

If you have a mix of some standard and some unique cases, dig a bit deeper. Create a list of case types that are more repetitive in nature. As an example, let's say your firm offers Wills & Trusts and Family Law. Break down the types of cases for each. A basic Will or Trust is likely a fairly standard process. Of course, some more complicated cases are anything but standard. Similarly, for Family Law, an uncontested divorce case is very different than a contested divorce. You get the idea.

Put together a 'menu' of these standard case types. These are the types of services to offer in your subscription model. Consider offering, and limiting, document review, in-person or phone calls, or access to resources. If your law firm offers any 'how-to' guides, consider making some of them free and open to all and some for clients only. These types of resources are great to attract potential clients so you don't want to move all of them to client-only accessibility. Recorded webinars, document access, tips, or even guides are good tools to offer your subscription members.

Automation

Reviewing these 'standard' case types, consider your level of automation. If you are using a paralegal or legal secretary to transfer data from a client interview or document to another document, well, you can do better. The right technology platform makes document automation simple. For these standard cases, the client provides all the information through their portal. The technology copies the information to the right field on the forms. Of course, you need to review the data and final copy, but it's a source of serious time savings. And automating these processes lets you offer even more on your 'menu' to ensure value to your subscribers.

If you haven't automated your standard processes, well, it's not too late. Generally speaking, once you adopt the right software platform, it takes only 30-45 minutes to set up the entire automation process. Look for providers, like SimpleLaw, that offer unlimited one-on-one training. 

Invoicing

This can be really tricky if your software doesn't allow for subscription pricing. One option is to see your subscription pricing at a certain number of hours per month. Let's say its 10 hours. So each month, you simply record 10 hours of billable time at the agreed-upon rate. It's not perfect, but it can work. 

Or, better yet, look for software that makes subscription billing simple. The right software gives you the flexibility to set the subscription agreement from 1 month to 12 months. The total due for the subscription period is divided equally among the months of the subscription and each month when invoices are created, the appropriate amount is entered. No math on your end.  And the software knows when to stop creating new invoices as it tracks the subscription period. 

Tracking & Reporting

The one issue with subscription pricing is to show the client received services for their fee, in accordance with ABA Rule 1.5.

Attorneys, paralegals, or anyone working on cases or in contact with the subscription client must track their time as if hourly billing is being used. Naturally, the time entries are marked 'unbillable'. However, it's important to send the subscription client a summary of services received. Look for a software platform that gives each user the option to track their time, along with the full description as you would for an hourly rate invoice. Then it's a matter of sending that report along with the invoice. 

Clear Definitions

As they say, the devil is in the details. Be absolutely clear about what is and what is not included in the subscription. If a client exceeds the allowable hours in a given month, as an example, specify the hourly rate the client will be billed, in addition to their monthly fee. If a case should grow beyond the anticipated scope of complexity assumed in the subscription agreement, specify how costs on that case are calculated. You can't anticipate every exception, but cover the ones you can. 

Other Benefits

The result of the recent census shows that income fell for many Americans over the last year or so. Anyone in need of legal help may have needed to push it off simply due to financial constraints. However, if your firm uses software that offers subscription pricing, it can also be used to spread payments over a longer period of time. Now, there are other issues to consider if you choose to offer that, like the timing of payments and case completion, etc. But suffice it to say, offering a payment plan is a good thing for clients who may be a bit cash strapped.

Ultimately, if your firm chooses to adopt subscription pricing, monitoring the results is critical. If you find your subscription fee is too high, well, you can adjust going forward. Likewise, if you need to raise it, after seeing the total cost versus payments. Like all pricing topics for law firms, it's critical to monitor your local area and type of law to ensure you are competitive. If you are not, well, go back to step one and dig into your firm. Look for ways to automate that save you and your law firm time and gives your clients competitive pricing.