Law Firms’ 2% Marketing Problem: Why Caution Compounds, and How to Build Demand That Lasts

Deborah Kelly
Jan 8
3 min read

*Strategic thinking in motion: building visibility, credibility, and demand - one insight at a time.*

Most law firms invest just 1 - 2% of revenue in marketing, excluding salaries, materially below the pre‑COVID norm of 2 - 3% reported by Thomson Reuters. Compare this with cross‑industry averages of 7 - 10%, and the gap becomes impossible to ignore. Legal continues to lag its peers, not because the sector lacks ambition, but because caution has become cultural.

When the market is expanding, low spend looks prudent. But when growth slows, and competition intensifies, the firms that underinvest in brand, pipeline and client experience are the ones the outgoing tide exposes.

The Legal Market Context: Growth With Warning Lights

The UK legal sector posted record revenue in 2024 and remains a major economic contributor. Yet beneath the headline numbers, buyer behaviour is shifting. General Counsel are prioritising commerciality, risk management, and cost control. More work is moving in‑house or down‑market to lower‑cost firms. Reliance on 'rising market demand' is no longer a strategy; it’s a vulnerability.

At the same time, Business Development and marketing spend as a percentage of revenue has trended downward for American Law firms since the pandemic. Larger firms are scaling their capabilities; others are falling further behind. The divide is widening.

Data Points: What the Numbers Say (and Why They Matter)

Law firm marketing budgets equal 1 - 2% of gross revenue, well below pre‑COVID norms.
Cross‑industry marketing budgets averaged 7.7% of revenue in 2024–2025.
Cutting spending in downturns destroys future advantage; firms that maintain or increase marketing during recessions grow faster post‑recovery.
Legal demand is shifting with procurement scrutiny, budget caps and specialist expertise now driving selection.
Digital performance costs can be higher in the legal sector, with Cost Per Click (CPC) and Cost Per Lead (CPL) outpacing industry averages.

Examples: What Happens When You Do (and Don’t) Invest

Maintain Investment Through Turbulence: Firms that keep their demand engines running by publishing expert content, running targeted campaigns and nurturing General Counsel communities retain visibility and win countervailing work.

Shift to Measurable Channels: Search Engine Optimisation, LinkedIn thought leadership and event‑led Business Development consistently outperform scattergun tactics.
Cut and 'Go Dark': Silence erodes credibility; and recovery costs multiply.

Practical Playbook: How Law Firms Can Lift ROI from 2% Budgets

Rebalance investment toward measurable demand generation while strengthening brand salience and specialist positioning.

Set Spend Targets Linked to Growth Goals: Target 3 - 5% of revenue for Business Development and marketing, with phased increases for new practice launches.

Measure What Partners Care About: Connect marketing activity to fee outcomes, Business Development wins, and pipeline velocity.

Align to Buyer Priorities: Shape messaging around commerciality, risk, ESG, and AI adoption - what clients actually value.

Make 'Owned and Earned' the Foundation: Publish monthly, practice‑specific insights addressing General Counsel pain points and segment by industry, role, and matter type and then target for nurturing.
Own LinkedIn With Real Thought Leadership: Build a partner‑level publishing cadence that showcases expertise, not announcements.

Run Precision Events: Prioritise invite‑only General Counsel roundtables and tightly curated discussions over broad‑reach webinars.
Pilot Paid With Guardrails: Test search and LinkedIn adverts only where conversion paths are proven and measurable.

The Real Issue: It’s Not the 2% - It’s What It Signals

Underinvestment isn’t just a budget line; it’s a strategic posture. Firms that treat Business Development and marketing as a cost centre will always struggle to build sustainable demand.

Firms that treat it as a growth engine create resilience, differentiation, and long‑term advantage.

The legal market is entering a new era, one defined by specialism, visibility, and client experience.

The question is no longer 'Can we afford to invest?' but 'Can we afford not to?'.

Call to Action: Build a Demand Engine That Works as Hard as You Do

StudioDMK partners with ambitious law firms to build the brand, marketing and Business Development foundations that drive measurable growth. From brand development and positioning, thought leadership to SEO, LinkedIn strategy, and General Counsel‑focused campaigns, we help firms move beyond the 2% mindset and create demand that lasts.

If your firm is ready to compete differently and win, StudioDMK can help you get there. Contact us today to find out how.