• Are daily deal sites a form of paid referral?
• Does an attorney engage in fee splitting with a non-lawyer?
• Are trust accounting rules satisfied?
My personal conclusion is that daily deal advertising is ethical — so long as safeguards are taken.
But is it a good idea?
Attorneys will take home only 25% of the purchase price of a service offered on a daily deal site. Sites require a 50% discount from the “shelf price,” then the site takes half of the discounted price as a marketing fee. For one attorney, this worked out to $13–26/hr for the work performed. This deep discount is far below the value of a service, so the marketing will be a success only if it leads to other work. This could come either as additional work for the same client or through referrals.
Restaurants sometimes complain of “low-quality” bargain-hunting customers. A St. Louis attorney who marketed $99 will packages via Groupon found this not to be the case. (View the ad here). In his experience, clients who found him via Groupon returned the respectful treatment they received from his law firm.
Attorneys may believe their dignity will be undermined by a marketing media associated with discounted donuts and beer tastings. But, as I argue in the NWLawyer article, this attitude is at tension with the goal of making services accessible and affordable. In my view, the tastefulness of a Groupon ad should be judged by its content, not the company it keeps.
[This post first appeared on the Washington State Bar Association’s Sidebar blog]