Shady Tactics Legal Vendors Use To Trap Small Firms

When Katie (my wife) started her law firm a few years ago, we were excited. It was going to be an adventure! As she walked out of her big firm job that last day, it seemed like the possibilities were endless.

And then the calls started. And the emails. And the tricks. It was like someone had put an ad on Craigslist saying “Easy mark! Hock your wares with abandon!”

With each step she took to start her firm, filing corporate docs, purchasing a domain name, signing up for phone service, setting up IOLTA accounts, it got worse.

I’m sure you’ve experienced the routine (and if you’re thinking about starting your firm, just wait.)

Phone calls at all hours. Because hey, we wouldn’t want to cold call a potential prospect during their working hours like everyone else, we need to stand out! 7am it is! Putting your kids to bed? Nuh-uh, it’s time to talk document management!

A constant barrage of cold emails with generic pie in the sky offers about this and that. None of any substance, just begging you to get on a phone call so they can see how much budget they can extract from an unsuspecting new business owner.

And the junk mail! Oh the junk mail! Not just “hey you should know about this service” junkmail, but downright fraudulent junkmail. Junkmail saying you’re in violation of some law if you don’t talk to them, or that someone’s going to steal your domain name or your trademark in China. Each looking more official than the last.

It’s exhausting. And we’d had enough. There HAD to be some good actors around. But the more I searched, the more shadiness I came across.

I’d had enough. And it was time to do something about it. So when I started AmazeLaw, I vowed to be honest with my clients, to treat them fairly, to empathize with the fact that they’re not an entity to extract money from, they’re small business owners, just like me, struggling and working their tails off for a better life.

I’ll leave it to my customers and to you to determine if I’ve succeeded, but in an effort to combat the shadiness, here are * tactics vendors are using right now to try and screw over small firms under the guise of being helpful.

Red flags in abusive vendor relationships

These are the tactics that should immediately set off red flags. Now not all vendors who use these tactics are bad by default, but they should act as leading indicators for abusive relationships so proceed with caution.

Being secretive about pricing

What they’re thinking: Their goal with this tactic is to get you to call to figure out whether it’s even in your budget. They don’t trust that you’ll be able to see the value of the product on their own, so they want you to contact a script-reading junior sales rep to convince you that it’s worth shelling out your precious cash, and then pass you off to a closer (account executive.)

Also, it means they don’t have any pricing structure to adhere to. They’re free to tell you any price (often after learning how large your budget is.) So they’ll start high, and work down so you feel like you’re getting a deal, often with steep discounts that magically appear when you tell them you’re all set.

How you can take advantage: This is the first step in some aggressive sales BS. But, if you really think the product works well (maybe you’ve had a colleague recommend it), you have a bit of an advantage if you’re willing to play hardball.

Make frequent price objections, threaten to walk away. Then actually walk away. Hang up the phone and tell them you’re just not sure about the price. I promise you they’ll call back. And there’ll probably be a discount in it for you.

Requiring annual or multi-year contracts

What they’re thinking: We don’t trust that you’ll stick around long-term, so rather than giving you 12 chances per year to consider whether that line in your bank account is worth it, they’ll only give you one option, and they’ll put a customer retention specialist in touch with you to promise big things for the next year.

And of course they’ll probably have a notice clause in the contract requiring more than 30 or 60 days notice of cancellation before it automatically rolls over. So when you contact them to cancel a few weeks before it rolls over, you’re told you’re already locked up for another year and if you want to cancel, you’ll have to pay an exorbitant cancellation fee (if they even let you).

There also appears to be a trend in the marketing services space (SEO, PPC Ads, Content Generation, Lead Generators, Directories) to require a 3 or 6 month commitment (often at $1k+/mo.)

While not as costly as annual contracts, they’re inherently higher risk. As an excuse, the sales rep will tell you that it takes time to see results from a new marketing channel. And that’s true, to a point.

But any person worth working with, any person you trust, will be able to give you an honest assessment along the way and let you know whether it makes sense to keep moving forward. They’re just trying to force the decision rather than letting their service speak for itself.

If they don’t trust that you won’t leave after a month or two, it says something (everything?) about how much they trust their product.

[Tweet “If a vendor doesn’t trust you’ll stay month 2 month, that says everything about their solution.”]

Note – These scenarios are different from annual prepay/billing. Annual prepay (often with a discount) can make a lot of sense for you and for the vendor. It helps them with cashflow and it provides you with a) a discount and b) the ability to play with your tax burden a little bit. If you have a strong year and you’re not sure the next year will be so fruitful, paying for the next-year’s services in December will reduce your tax burden this year (assuming you’re using cash accounting.)

Obviously, I’m not an accountant, so that’s not financial advice. But I would advise setting up a standing meeting with your accountant every fall to go over your accounting and help make decisions like this while you still have time before the end of the year.

Now before you sign up for annual prepay, you should ensure that you’re not locked in. For example, we offer 2 months free for our clients that sign up for annual billing, but if they get six months in, we’ll send them a pro-rated refund. They’re not locked in.

So be sure to ask what happens if you cancel half-way through your annual contract so you can correctly weigh your options.

How you should handle this: Except in circumstances where the value is clear and you’ll clearly need it long term, I would run, not walk, away from these terms. Cash is king for a small business so don’t lock yourself up unless you’re absolutely sure it’s worth it. And make sure you ask if they have…

Early cancellation fees

What they’re thinking: This is usually paired with those big annual contracts. It’s nothing more than a way to make you question your decision to cancel and extract a little more cash on your way out the door. It’s extortion, pure and simple.

AmazeLaw is actually a rare business where a customer leaving actually costs us time and money. It takes a lot of time and effort to move a website. And even we don’t have cancellation fees. We’ll lose money. That’s our punishment for not meeting our clients’ needs, and our incentive to do better. Thankfully it doesn’t happen very often.

What you can do: Honestly, not much. You can try to negotiate your contract at the beginning, but that’s about all you can ask for. But before you do that, you should probably question why they need that clause in the first place and if that’s someone you want to work with or trust a part of your business to.

Owning your domain

This is specific to website providers but it’s egregious enough that I need to call it out. Some providers insist that they control the domain name for your website. Claiming that it’s easier if they register it. That they’ll make sure it’s always renewed.

What they’re thinking: If they own your domain name, you can’t go anywhere. In order to move your website, you’ll need a new domain name and you’ll give up all of the SEO you’ve built up. What’s more, you’ll need to update all of your business cards, potentially your email address, etc. It’s just another form of extortion to keep you from canceling.

What you should do: DO NOT DO IT. Register your domain under an account you (and only you) control. Make sure you sign up for auto-renewal. I usually recommend Namecheap or Dynadot (GoDaddy is ok too because they’re ubiquitous, but they have some questionable tactics of their own I recommend my clients avoid.) If they insist, run away.

Controlling your phone number

This is just like controlling your domain name. And with the rise in importance of local search and its reliance on consistent Name-Address-Phone Number (NAP) for rankings, it’s gotten even worse. Having a different phone number on your website than the one you have on your business cards, or in the phone book is a big no no.

What you should do: There should only be one phone number for your business, and it should reside with your telephone service provider.

Acting as the middleman between you and your clients

That phone number control is often used as part of a feature called call-tracking, an attempt to funnel all website leads through a proprietary system. Of course that assumes that your leads want to call you. Some vendors even go so far as to not put an email address on your website, forcing the visitor to either pick up the phone or fill out a generic form that connects to their system and their system only.

In addition to being yet another lock-in tactic so that you don’t lose your contacts, it kills conversions and virtually guarantees that your prospect moves on to the attorney that allows contact via whatever means the prospect is most comfortable with.

What you should demand: You need to own your communication with your clients. Any barrier that’s put between you and your clients is not worth whatever low-volume metrics you might be able to pull out of your marketing vendor.

Promising the moon

This is pretty straightforward. An over-eager salesperson making empty promises to hit their monthly quota. Sometimes it’s subtle, but when you start to think maybe they’re being a little too generous with their predictions here’s a tip…

How can you use this? If you’re wondering if they’re pulling the wool over your eyes, then a surefire way to tell is by using a trap question.

Take the vendor’s pitch to the extreme, ask them if that’s a typical result. For example, for a company building a website or an SEO firm, ask them if this product will get you on the first page of Google. For a lead gen product, ask if you’ll get at least 5 qualified, high-quality leads every month.

Of course, if they say yes, ask for the names of two or three clients that have had those outcomes so that you can speak to them about their experience. And then watch the excuses fly. They’ll say that they don’t disclose client information.

You can even ask for a guarantee. That you can request a refund if those results aren’t met. That’s almost always a no-go on their part, but at this point the deal’s probably over so have some fun and watch them try to justify why they can’t 🙂

If they say no, that those results might be possible but that they aren’t typical, that’s actually a positive sign. Ask them under what circumstances you could expect to see those results. Ask them what the typical results actually are. If they’re honest about the conditions where the solution works and where it doesn’t, they believe in what they’re selling and it might be worth trying as well.

But again, ask for two or three references that would be willing to back that experience up.

Not being willing to provide references

Here’s what they’re thinking: A lot of the legal marketing vendors out there are entirely based on pump’n’dump schemes, where they sell all of the attorneys in a given area on a product, then move on, like locusts. They know after their initial contract term, 90% of the clients that remember to check their billing statements will cancel, but they don’t care. Their job is to get folks signed up as quickly as possible, on the longest terms possible.

In those scenarios, it’s really hard to find a long-term customer that’s willing to speak with prospects. And if there’s only a handful of them and they’re selling at scale, they just can’t afford to send hundreds of reference requests to each attorney that offers.

Here’s the cold hard truth. If a vendor doesn’t have at least a few attorneys literally raving about their experience, then it’s probably a no-go. After all, by the law of large numbers alone, there should be outliers that are having success. Even if they can’t give you a phone number, they should be able to send you case studies of successful clients. And often from there, you can do some basic Googling to find the subject’s contact information if you need to verify their story.