This article is written by Ramanuj Mukherjee, CEO, LawSikho.
What entitles you to charge a premium? Are you curious about this as a lawyer or a professional? Why should clients pay you INR 10,000 per hour whereas most lawyers will happily charge just INR 2000 per hour or even less? In most courts there are lawyers who will appear in a matter for INR 500 or 1000, why do some lawyers charge 1 lakh per appearance in the same courts, including district courts and magistrate’s courts?
That’s a million dollar question for you, isn’t it?
So let’s delve into this question today.
I needed a helmet recently. I needed it very urgently, so I sent someone to a streetside shop to get the cheapest one. When it came, I was taken aback. It cost just 300, but it looked totally ugly and uncool. It was useful though. I used it because I had to get around on a two wheeler and I did not want to get caught by police for not wearing a helmet. Here is a representative picture of it:
Then I ordered a helmet from Amazon. I have put up a picture below. It costs Rs 1700, comes with an in-built pollution mask, inbuilt goggles and a better design.
The better design/looks was a decisive factor. It helped that it had an anti-pollution feature, given that pollution problem in Delhi is very serious. The inbuilt goggles fascinated me though I have almost never used it in reality.
I was happy to buy something elegant and beautiful, with rich features. And happily paid almost 6 times the price for it!
What do you pay a premium for? How much are you ready to pay? Think about it before reading any further.
Thought about it? Great. Now read on.
We are still talking about helmets. In the same world, there exists something like the CrossHelmet. It costs USD 1650 a piece if you crowdfund it, and is expected to cost above USD 2000 if you buy it off the market later. That is correct. INR 1.4 lakhs or more for a helmet. Not for flying a military plane, but just for a normal two wheeler!
What makes this price possible? As I can see from their Indiegogo page, 24 people already backed the campaign by paying USD 500 each, so people are ready to pay this even the final product not being launched, just based on the promise of what it will be like.
There are 100 megapixel cameras these days. Do we really need such detailed pictures? How are we going to use them? We can barely tell the difference between 10 megapixel with the naked eye. Still camera and phone companies advertise huge megapixel numbers and we take such details into consideration while buying. This is just like fast cars on city roads. Some people pay crores for a powerful car that can drive at 300 km per hour, but you are never going to drive at a speed above 60 km per hour. Are they paying for the speed and ability of the car? Or for the vanity and pride of owning something incredibly powerful?
It’s not just utility that makes something expensive. It is also about our desire to buy something rare, sophisticated, powerful and make it our own. We take pride in what we can afford. That is why people pay a premium to buy expensive phones or cars that have features that have no practical utility.
Have you ever done that? Or at least desired to buy something expensive that you cannot afford? We all have.
How do you think this works for a lawyer? Why would someone pay premium to a lawyer? Do they pay it for peace of mind? Do they pay a premium to get the best man available for the job? Do they trust a certain lawyer so much that they are ready to pay above market fees? Why would a client who just wants a basic contract drafted pay a top litigators top dollars for that?
Legal services is sometimes an emergency service. Sometimes it is about avoiding risks. Sometimes it is about saving a valuable property or your reputation. Sometimes it could be the difference between going to jail and not.
Sometimes it is whether your business is given the best legal inputs or not. Will you leave such things to chance?
It is therefore not surprising that expensive lawyers are more in demand than cheap lawyers.
Yes, read that again. No one wants to hire cheap lawyers unless they are forced to. Even if you have no money and a cheap lawyer agrees to take your case for a low fee, will you not be worried? Will you not have a lack of trust and lack of respect for that lawyer?
It is unfortunate but this is how things work. If you charge less fees, then you will be shunned by most and even your clients who hire you will assume you are not that great. They would want to move on to the more expensive lawyers the moment they can.
Understanding this aspect of client psychology is critical about success as a lawyer.
Also because you are charging less, you can spend less time, cannot dedicate a lot of resources that a more expensive lawyer can, and not even provide great customer service to the client.
You are also likely to attract low quality clients if you charge less. They may not have respect for your time and boundaries. They may not even be cooperative. Compare that with a client who can pay bigger fees. They know they are paying for expertise and skills to a lawyer. They will respect your time and abilities. Simply by charging more you begin to attract better and higher quality clients.
If you are charging less, you will be forced to take volumes of clients just to make up for the low per client fees and your quality of services and peace of mind will suffer.
This happened to us in LawSikho recently. By January, our courses were doing really well. We were happy. By March, the volume of students went up drastically. Whereas we wanted just 20 people in a batch, we had 40 people trying to join. It is hard to say no to people when they are ready to pay. We tried doing first come first serve but it became hard to pacify people who had urgency. Who wants to delay their professional growth? In most courses, we did a new batch every 2-3 months, and even then we find it hard to accommodate all. However, quality suffers in a class if there are too many students.
Even my team members are not willing to tell a student please join in the next batch we have no more seats! We all want more revenue. Our team members want more enrollment so that they can get more salary, bonus and perks. And they deserve it for the amazing work they have been doing, and for standing by the company in times of dire need.
Who am I to tell them to not take in paying students?
So we had to take a call. Are we in the volume game or are we the premium online education company? To manage the situation, we had to increase prices, after a fair warning to all the interested people of course, by as much as 50% for some courses. For a couple of courses, it was just 20% hike. Still, unheard of in the online education company. Most of our competitors have been steadily reducing their prices and still struggling to sell courses despite giving discounts on top of discounts!
Our strategy has always been the opposite. How can we give full value if we take discounted fees? How does that impact our long term brand? Now that we are charging more, we can give more attention to every student, and spend more on making the absolutely best courses in the world. This is how we have been building the most powerful brand in the legal education space.
Our competition is not with MyLaw, Enhelion or Rostrum, we want to challenge the Harvard, Oxford and LSEs of the world – such that people will prefer our online courses globally for continuing legal education over the various distance and summer school programs the big universities offer.
People pay lakhs to go to LSE for a summer school. The day we at LawSikho can charge in lakhs, I will feel that we have achieved this goal.
I am thrilled to imagine what kind of crazy, amazingly good courses we have to make for that!
Who are you going to be? What is your vision about your career?
Imagine that you got a tax notice asking you to pay a fine of 1.5 Cr because the tax officer thinks you wrongly avoided paying some tax. What are you going to do? It is a lot of money at stake.
Will you save money by going to a cheap lawyer? Or will you go to an expensive one? Will you want to go to the best lawyer available in town, even if he charges INR 10,000 per hour or more?
I remember my father had to do an appendix operation. A pretty simple one. However, he went to the most reputed hospital in the city, and paid a premium gladly, because he did not want to take a chance with the surgery. When going under the knife, nobody wants the cheapest surgeon.
Can you be the lawyer who has the best reputation in a certain kind of legal work?
The premium you can charge as a lawyer, at the last mile, is a function of your brand as a lawyer. Your brand as a lawyer is a function of what the lawyers and clients who have worked with you say about you.
What people say about you is a function of several things, but most importantly: your integrity, competence and external validity.
These are the three things you need to work on. If you put in enough work in these three aspects, you can get to the point where you can charge INR 10,000 per hour. I have seen many of my friends starting from 0 and getting to INR 10,000 per hour. Each of them own a thriving law firm today. When I am writing this article, they are my inspiration. Several faces and many stories come to my mind when I think of this subject.
The first quality, integrity, is not something you need to work on as such. It is a place to start from. It is about being authentic, not showing off and misleading people about what you can do and cannot do, and doing what you said you will do and doing it when you said you will do it. If people can trust your word, you have integrity in the professional domain.
The second quality competence is a journey. You have to work on your competence all the time, during good days and bad. You must set aside time for learning and development. You must invest time and money into growing your competence. Good lawyers buy tons of books, subscribe to many databases, buy software and hire talented lawyers under them so they and their organization have the competence to deliver results.
The third quality is external validation. If some people have good things to say about you, then other people pick up on that cue and say even better things about you. It is either a virtuous cycle where good word about you keeps spreading and gets reinforced as people talk to each other, or a destructive cycle where people speak ill of you and a lot of people form a negative image about you over time.
The cycle starts with you. You present yourself in a certain way. What work you do, what clothes you wear, your appearance, your abilities, your communication, your degrees, previous workplaces, whether you appear on TV or whether you publish amazing articles – these things determine your presentation.
Just like you do not have direct control over what people think of you or say about you, your presentation is under your control to a great extent. You must do a lot of work here. If I could take a year off from my work today, I will spend that year entirely by working on my personal brand, to kick off a storm of a virtuous cycle in my favour. Every ounce of effort spent here is totally worth it because the results you derive are massive in the long term and almost always unimaginable to start with.Just invest in the brand that you are. Unhesitatingly, unquestioningly and without any delay.
How will you get started on your journey towards becoming a professional who can charge INR 10,000 per hour?
You could do so as a law firm partner who negotiates critical business agreements that govern investments of thousands of crores.
You can do that as a trusted advisor whose advice top businesses seek out.
You can do that as a sought after litigator who is trusted to deliver results in litigation or arbitration.
You can do that as a trusted in-house counsel whose presence in the company gives great peace of mind to the business heads in a big corporation.
You can do this as a criminal lawyer who might be able to get someone a bail, or save someone from going to jail.
Maybe you can get someone the fair share in his family property, or recover money from a cheating partner or vendor.
Maybe you can tell businesses about how to expand their footprint in new companies.
You can help a company about to get listed on a stock exchange with complicated legal requirements.
Maybe you can help companies with cumbersome compliance procedures, represent their interest to the government to influence policy decisions or get licenses that are hard to get.
If you do something special and valuable, you will get a fraction of that value as your fee. And there are a lot of expensive problems in the world that you can solve as a lawyer.
However, to get those clients, you need to start by investing in your own capabilities. We have Master Access by LawSikho that may help you to get there. It is an amazing database of learning materials as well as resources that will help you to get real life work done efficiently and fast. Just check it out, I promise it will blow your mind.
When I make courses, I do not worry about putting inadequate resources to make them amazing. I do not want to offer courses worth 2000 or 4000. I know that I am in the business of training and helping the lawyers of the future who will charge even more than INR 10,000 per hour. I am training lawyers who can draft one contract and charge at least INR 10000 for that one piece of work.
Should I offer them courses worth 1000, or 2000? Or should I charge them a fair amount and give them all they need to succeed at the grandest level of law practice?
So our LawSikho courses are more expensive than what most others sell as online courses, but they are also a lot better, and we still get more students because of the value we provide. If you compare with the value one gets from the courses, the price you pay is a great bargain, and I want to keep it that way! We will offer a great bargain to you not by offering cheap courses, but a lot more value through the courses we provide.
Recently we hiked our prices, just so that we can walk the talk and give even more value to our students. We have been hiring better trainers, better evaluators and creating better content for your success in a massive volume.
When you buy a course from us, you just don’t get some study material. You almost get a library of study material inside your app and online account! You also get personal feedback, simulation exercises, training to write and publish, and mentorship. We even help you to grow your practice or land better jobs.
I chose to make my courses premium, and decided to ensure that I can give 10x the value to each student compared to what I charge. If I charge you 30,000 for a course, you should get value of 3 lakh because you did that course. This is why I even confidently give a 45 day money back guarantee, unheard of in India. Visit the link and check it out. You can buy our premium course risk free, try it out and get full refund if you do not like it despite following the course according to its design.
When I speak to the lawyers who buy our courses, I see that they are not worried about the price tag. They are worried about the value they get.
And yes, there are some people who are worried about the price. Should I reduce the price for them and give them less value? That will erode the brand of our courses. I leave that to my competitors to do.
How are you going to become the premium lawyer rather than the cheap lawyer?
Also, check out these courses in which admission will be closing for upcoming batches in about 10 days:
Diploma
Diploma in Intellectual Property, Media and Entertainment Laws
Diploma in Cyber Law, Fintech Regulations and Technology Contracts
Executive Certificate Courses
Certificate in Labour, Employment and Industrial Laws for HR Managers
Thanks for sharing this blog.