COMMENTATORS talk excitedly about “Tesco Law” and the ongoing liberalisation of legal services as though it were a latter day gold rush led by big name supermarkets and banks. But what is it that consumers want? New research suggests that there is little enthusiasm on the part of the public to associate legal services with high street big name brands.
In a survey of more than 2,000 people commissioned by the legal research company Jures, consumers were asked if they could purchase legal advice from household names from the retail, banking and insurance sectors, which one would they go for. While the most popular of the big name brands was Marks & Spencer (14 per cent), the big news was that more than half remained unmoved by the prospect of big names (54 per cent). Despite the hype, only one in 20 consumers linked the retailer (Tesco) that has become synonymous with the new market with legal services.
The results are in a new report Shopping Around: What Consumers Want from the New Legal Services Market, out last week. From October 2011, the first alternative business structures will open their doors for business under the Legal Services Act. This move has been likened to the law’s equivalent of the City’s Big Bang in the 1980s which came about as a result of the deregulation of financial services and banking. ABSs will enable non-law businesses such as supermarkets, banks and insurers to have to compete in the legal services for the first time.
Professor Richard Moorhead, deputy head of Cardiff Law School, is unsurprised that consumers don’t automatically gravitate towards the comfort of familiar brands. “The findings suggest there is everything to play for,” reflects Prof Moorhead; adding that his own research found that consumers, in his words, “don’t do much shopping around”. The overall winner in the Jures survey was M&S. “It is seen to be good quality and value for money which is, of course, the magic combination here,” notes Prof Moorhead. People were asked which factors were likely to influence their decision to buy legal services, “reassurance of a well know brand” (26 per cent) came some way behind “quality of service” (60 per cent); “fixed prices” (35 per cent); “ease of location” (32 per cent); and “speed of service” (27 per cent).
BRAND AND QUALITY
But, as Prof Moorhead notes, “brand” and “quality” are hard to separate. “Most consumers have absolutely no idea of how to measure ‘quality of service’,” he argues. “The finding might reinforce the importance of the “reassurance of well-known brand”. It might well be that they use the brand as a proxy for quality.”
The practical challenge for firms is achieving brand visibility in a newly-liberalised, increasingly crowded marketplace. Client recognition of law firms is poor. The Law Society’s Gazette recently reported that more six out of 10 consumers couldn’t name a single firm, despite the fact that almost eight out of 10 had used a solicitor before.
Law firms have been doing their best to change this by harnessing collective marketing might through networks such as Injury Lawyers 4U, Quality Solicitors and Loyalty Law. So far few legal brands have impinged on the public consciousness in any meaningful way with the possible exception of the claims management company Claims Direct. The law firm Russell Jones & Walker bought the Claims Direct name relaunching the service in 2007 with a £5m annual advertising campaign.
RJW chief exec Neil Kinsella is sceptical about the collective approach. “If solicitors are banding together to take over a market that they have already effectively got, all they’re effectively doing is scrabbling for market share and then paying somebody in the middle to do the marketing,” he says.
A couple of weeks ago QualitySolicitors launched its national “high street” branch network with the first 15 of 300 planned “branches” across the UK. A number of well-established regional firms had a complete make-over, reappearing as QualitySolicitors Burroughs Day, QualitySolicitors Lockings, etc.
Craig Holt, chief executive of QualitySolicitors, is taking inspiration from a well-known brand from the retail world. Specsavers became a fixture on the high street following deregulation of the opticians market in the 1980s. The Legal Services Board, drawing a parallel between the reconfiguration of the opticians’ market and legal services, last year noted that a small number of chains cover 70 per cent of the market though “a substantial number of independent opticians” remain.
Under the Specsavers joint venture model, each practice is an independent business owned by chain and practitioners jointly, meaning it can deliver economies of scale on, for example, marketing, while practitioners remain responsible for delivering the service and running the business.
Will walking into a branch of QualitySolicitors feel like walking into Specsavers? “All aspects of each firm will be branded in the same way from signage through to stationery and website, right down to business cards, compliment slips and the front of house staff uniforms,” Craig Holt replies. He wants the QualitySolicitors brand to be “as familiar as going to Barclays for banking or Thomas Cook for a holiday”.
Claimant firms were slow to react to the threat of newcomers such as Claims Direct, which entered the market on the back of the Access to Justice Act 1999. The non-lawyers took a huge amount of market share away from law firms through saturation TV campaigns. The solicitor-led marketing consortium Injury Lawyers 4U, now one of the biggest-spending advertisers on TV, was a successful attempt to wrest back some of the territory lost. Are they worried about the proliferation of solicitor networks effectively diluting their message? “No, competition from the profession is a healthy thing,” responds partner Martin Cockx, a partner at the Manchester firm Amelans who set IL4U up. “Solicitor consortiums are, as we have proved, the way forward.”
Loyalty Law is a new scheme aimed specifically at high street solicitors. The concept is “to build a nationally recognised legal brand providing a quality legal service from smaller firms”. The “loyalty” element encompasses a number of ideas… clients rate the service, plus every time someone uses a lawyer they receive a “credit” against future legal purchases or a voucher towards a non-legal reward scheme.
Does the LSA mark the beginning of the end of the high street solicitor? Nick Jervis, director of Loyalty Law, believes there is a future for small community solicitors’ firms in a world where shoppers have increasingly chosen to go local. He cites “farm shops and home delivery of organic vegetables” as evidence that with “some clever marketing and a targeted local approach the consumer has gladly returned to smaller providers”.
There’s “strength in numbers and firms can harness marketing clout by forming networks”, argues Jervis. “The big advantage that small firms have in terms of building brand is that they can use personality. The Richard Branson school of marketing which has worked very well for Virgin can be just as effective for a small law firms.”
QualitySolicitors’ Craig Holt argues that consumers presently “see a fragmented market” with law firms that “aren’t particularly commercially or consumer astute”. “So the likes of the Co-op see that as being fairly fertile grounds to make inroads,” he says. “Our approach is to take the ground away from them. We want to adopt the retail approach, take up positions in high streets and shopping centres and head them off at the pass.”
Are lawyers going to be giving consumers what they want in this post LSA market? “As far as I am concerned Tesco sells peas and we do law,” says IL4U’s Martin Cockx. “You’d never go to a chiropodist to sort out your eyesight. It is crucial for an organisation like ours to push the message that this is all we do.’
Jon Robins is director of the legal research company Jures (www.jures.co.uk) and a freelance journalist. You can find out more about Shopping Around at www.jures.co.uk