2 Critical Personal Injury Advertising Numbers to Know

Does your personal injury advertising feel like gambling? If you don’t know your numbers, that might be the reason.

dice for gambling with advertising

An article about the two critical numbers every personal injury law firm must know about their advertising prompted me to write about why that is a little too simplistic.

The first number mentioned is the Average Cost Per Lead (CPL), and the second number mentioned is the Average Cost Per Client (CPC).

The article by the Rainmaker Blog, a marketing agency for lawyers, also provided their definition of a lead and a client, which is likely the definition of most lawyers, so I won’t go into that here.

The 2 Critical Numbers You Need to Know

The Average Cost Per Lead is easy to figure out. If you spend $5,000 and receive 25 leads, your cost per lead is $200. $5,000 divided by 25 = $200.

The Average Cost Per Client is also easy to figure out. If you spend $5,000 and the conversion rate of your accident leads is 20%, you will have retained 5 accident clients at a cost of $1,000 per client.

Why Are 2 Numbers Too Simplistic?

If you only look at CPL and CPC, you may overlook or intentionally avoid other types of media or target populations which look expensive on their face but are extremely lucrative.

We advertise in a niche motorcycle magazine for motorcycle accident clients. The magazine seems expensive because it has very few readers and results in few clients.

If you just look at the CPL and CPC, the motorcycle cases cost more than our other cases (see below). But the cost is deceiving because motorcycle cases have the following attributes which offset the higher CPL and CPC:

  • Substantially increased conversion rate (90% of motorcycle leads become clients);
  • More valuable injuries with larger legal fees;
  • Settle faster, producing faster cash flow;
  • Require much less work;
  • and higher ROI.

We have had many motorcycle cases settle for $100,000 with just three hours of work.

Of course, we also look for other types of personal injury cases. But we keep the easy cases that can be settled quickly with very little work and refer out the cases which will require a lot of work to another personal injury law firm.

We used to pay for leads generated by someone who operates a truck on the street and sells leads to lawyers.

When looking at the CPL and CPC, the cost per lead initially seemed worthwhile, but the truck leads result in a lot of crazy people; people with injuries too minor to retain; many people who we can’t contact; a few that had no idea how we got their number, and a very small number of good cases.

All of our leads are referred out but those leads required so much of my partner’s time to vet out that we wanted to discontinue. The lead provider offered to substantially lower our cost per lead but after a while, we discontinued because our advertising money was better spent on Google Ads where we get better quality leads and have a consistent cost.

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We also earn a substantial income on the cases we refer out.

Motorcycle Accidents Have Higher CPL & CPC but Are More Valuable Than Car Accidents

The following shows how one type of accident costs more money per lead and more per client but has a lower total investment cost and more legal fees resulting in a higher ROI.

Motorcycle accidents
A $25,000 annual advertising budget yields 50 leads. The Cost Per Lead is $500, but motorcycle accident leads have a 90% conversion rate yielding 45 clients at $555.55 Cost Per Client. They have an average settlement value of $120,000 each and a $40,000 legal fee each at a 1/3 retainer = $1,800,000 total legal fees.

Cost of advertising = $0.0138 per $1 of revenue
$1 interested in advertising yields $72 with much less work than other accidents.

Car accidents
A $30,000 annual online advertising budget yields 300 leads. The Cost Per Lead is $100 and has a 20% conversion rate yielding 60 clients at a $500.00 Cost Per Client. They have an average settlement value of $50,000 each and a $16,666.66 legal fee each at a 1/3 retainer = $1,000,000 total legal fees.

Cost of advertising = $0.03 per $1 of revenue
$1 interested in advertising yields $33.33

Motorcycle Accidents vs Car Accidents
Cost Per Lead               $500 vs $100
Cost Per Client              $555 vs $500
Total Investment            $25,000 vs $30,000
Total Legal Fees at 1/3  $1,800,000 vs $1,000,000
ROI                                7,100% vs 3,233.33%

Obviously, car accident cases are very lucrative and shouldn’t be ignored, but if you were only looking at the Cost Per Lead and Cost Per Client, you might decide not to pursue motorcycle accident cases. That would be a big mistake.

Besides 2 Numbers, What Else Do You Need to Know?

Besides the two critical advertising numbers, you should also evaluate the following about the leads you are generating, especially for contingency fee cases such as personal injury:

  • Quality of the leads acquired from the advertising campaign;
  • Amount of time to settle the cases retained; and
  • Amount of work required for each type of case retained.

Besides CPL and CPC, determine which advertising campaign produces the following:

  • Lots of crazy people vs. mostly people with good cases
  • Amount of time required to call back leads
  • Leads that convert better (more people retained)
  • Leads with bigger injuries
  • Leads with cases that are easier to settle
  • Leads with cases that require less work
  • Leads with cases that settle faster
  • Leads that produce larger legal fees

Additional time and work result in higher overhead and reduced cash flow. Although these cases are still worthwhile, it’s beneficial to think about targeting the cases that are more financially productive.

How Much Time Do You Need to Evaluate Your Advertising?

You also need to decide what period of time to evaluate. While evaluating each quarter is a good idea, depending upon the type of media used, results should be looked at a period of 6 months to over 2 years.

6-12 months is sufficient to evaluate an online campaign, but where branding is used, branding typically takes two years to achieve its results.

Read about advertising for personal injury lawyers

Philip L. Franckel, Esq., is the author of this article.

Phil Franckel is the owner of 1-800-HURT-911® and over 1,100 domain names. He is a personal injury lawyer and a former Member of the Board of Directors of the NYS Trial Lawyers Association. He is an expert in branding, advertising, marketing, and SEO. He has been doing SEO since 1994.

Phil Franckel has written and produced TV commercials for lawyers and other industries and has been a consultant to businesses, including several using vanity phone numbers. Phil writes a blog about lawyer advertising at LawyerAdvertisingBlog.com.

Phil Franckel began a mail order business in 8th grade, bought and sold coin-operated amusement games in 10th grade, and a used car business in 12th grade through college. After law school, he worked in the wholesale diamond business and part-time for a TV production company. Later, while a lawyer at a large personal injury law firm, he worked part-time for ABC Wide World of Sports and ABC Monday Night Baseball.

Phil Franckel then started a personal injury law practice and is a former member of the Board of Directors of the NYS Trial Lawyers Association.

In his spare time, Phil Franckel became an Aux. Police Cadet in 12th grade and is the Commanding Officer of the Communications Bureau, NCPD Aux. Police Section.


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Philip L. Franckel, Esq. is a member of the Personal Injury Dream Team™; He has a 10 Avvo rating; Avvo Client's Choice with all 5-star reviews; Avvo Top Contributor; and is a former Member of the Board of Directors of the New York State Trial Lawyers Association.