So tomorrow morning you get a call from your assistant:
There’s a Mr. L waiting to see you. Said you are expecting him. A legal invoice and project managment software application. With an eDiscovery module. Or something like that.”
You think you have never heard of him, but in fact you have. He’s been calling you for 6 months and has sent you 3 packages of information. You told him if he was ever in town, he could pop in. He’s in town.
This is post #3 in an ad-hoc legal tech series. The first, an overview, looked at who will pay for tech going forward in the brave new legal world. The second, earlier this week, examined some of the challenges faced by developers of legal software.
Today we look at the process of selling new legal software. Nothing happens in life until something gets sold. You learn that over time; we certainly did not learn that in law school.
These realities of getting legal software bought and paid for are focused on enterprise applications–those used by bigger law firms and their larger clients, particularly those that have legal departments. That is where a lot of the focus is today, with many well-funded competitors chasing the same customers with similar offerings. The solo cranking away on a general civil practice may be the backbone of the legal community, but since Attorney X’s secretary may still be using Word Perfect, it’s not a popular target market.
So here we go, seven challenges to selling legal tech:
1. No one really wants new technology. It can be hard to understand, and harder still to justify up the approval chain when the sales rep leaves the conference room. Everyone expects a decent learning curve with new technology; I am still finding new ways to prepare bullet points in PowerPoint 2003. Poorly designed software makes users skeptical. Applications that didn’t have adequate training provided make lawyers gun-shy when they hear “something new is coming next week” which will “really help you be more productive.”
2. Of course you need a strong ROI. There was a time when the “it doesn’t really cost you; it pays you” line worked for some products. Now buyers are more sophisticated. They have been burned by products and services that over-promised and under-delivered. Maybe 2x ROI got someone’s attention in the past. Now it has to be 10x or 20x, at the bottom end of the range. If it isn’t a no-brainer, it will likely be a no-thanks. New needs to transform, not merely help transact.
3. Software has a long sales cycle. The understatement of the century, I know. You’d think a company that buys $100,000+ of legal services per month could make a $5,000 one-shot software purchase without breaking a sweat. But that typically isn’t the case. Sometimes the law department purchases the software, but often purchases are coordinated through the IT group. This is particularly the case when new hardware is required to run the software, or because IT knows that they will get help desk calls and lawyers don’t RTFM. This even holds true when the purchase has been budgeted.
4. Software-as-a-service can give a bit of a leg up. This allows legal to tell IT that they don’t need to worry about system compatibility or user training. In fact, some legal departments may try to say such applications aren’t software at all, they are really a … service! It doesn’t always work this way in practice, but it can, and should shorten the sales cycle somewhat. Unless…
5. There’s always the security red flag. At some point, someone in IT will raise security issues, particularly when an SaaS app will be hosted by the vendor and critical corporate data will be stored offsite. Some of these concerns are legitimate, although the company probably uses finance apps to route money daily that amounts to 100x the annual price of the legal software in question. Seeing as how major banking institutions and even defense contractors have been hacked, I don’t see this issue as unique to legal. But boy can you ever look bad in software review meetings if you fail to take it seriously. All hail the secure cloud.
6. Customers are onto the maintenance game. Certain vendors who shall remain nameless have torched customers over the life cycle of software with maintenance agreements or upgrade costs that either were not fully explained or increased faster than anticipated. If you have someone on the internal review team that has had to get a budget variance to cover something like this, good luck. Again, this is where software-as-a-service can help do an end run around these objections.
7. You first. No, you. The hardest thing for any new entrant in the legal software or app space is to get the first few customers. These pioneers have a lot to lose and little to gain if things don’t go as promised. Getting one of these customers to act as a reference is harder still. Since there is time and user bandwidth involved with anything new, some vendors find it is hard to even give their new offerings away at first.
There you have it. Developing and selling new legal software is not easy. But it’s critical to progress on cost and performance fronts. There are some really good solutions on the market right now, and at least a few exciting things under development or in early user testing.
Corporate legal won’t advance until something gets sold. So when a visitor stops by your office one morning, think twice about telling him you’re in a meeting and to come back some other time.
This hearty soul is not a mere peddler; he is really an agent of change…