Get advice and service right, and price becomes less important – major survey of client needs

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19 November 2012

Adams: rising client expectations

Quality of legal advice and service still trump cost when clients choose a lawyer, although certainty about price and a firm’s use of technology are increasingly important, according to a major survey of client needs being released at today’s Legal Futures conference.

Peppermint Technology’s annual research into what clients want from lawyers also found a large majority of businesses expect to spend as much, or more, on legal work in future and that while lured by price, individual consumers stick with firms that give good service.

Rising client expectations mean firms need to provide “a highly personalised and consistent experience, 24/7 service, quality advice and all of this at a predictable and competitive price point”, said Peppermint’s chief executive officer, Arlene Adams.

The legal software company – which specialises in supplying client-focused technology to law firms – surveyed a representative group of 1,020 consumers; key personnel at 150 UK businesses employing 75-3,000 employees; and partners or senior managers at 151 law firms with more than 10 partners.

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The quality of legal advice was chosen by 82% of consumers as being most important – rising to 85% among over 35s – with quality of communications in terms of advice delivery and information on progress the clear second choice. Value for money was a lesser priority, suggesting that “if you get the advice and the customer service right, then the cost of legal advice becomes much less important”, the survey said.

However, in figures reflecting what motivates first-time consumers, more than 60% said fixed fees were an important or very important factor in deciding which firm to instruct and a further 33% said it “may” influence them. Nearly two-thirds also ranked total cost either top or second among factors affecting their decision.

The survey said: “The evidence of this survey is that price is a key factor in winning new clients, but that customer service is the key to retaining them and ensuring that they can be charged profitable fee rates.”

Among businesses, Peppermint found positive indications of future demand. It said 88% of business clients expected their legal spend to rise or at least stay the same. Also, in common with consumers, corporate clients rated quality of advice over price. Nearly nine out of ten business clients highlighted the importance of quality and fewer than half placed price in their top two reasons to use a new lawyer.

Just 7% cited a firm’s brand name as a reason to switch firms and more than half said the recommendation of a trusted friend of colleague would be the most compelling reason to try out a new firm.

Around half or more of business clients considered value for money, the quality of staff and the speed of service as important in exchange for their patronage, with the quality of communication close behind.

While 82% of corporate clients said fixed fees were important and agreed hour-based billing had the potential to sour relationships, lawyers claimed to be meeting this demand head on. Some 90% of firms said they offered fixed fees, 82% capped fees, and 72% success-based fees.

Observing that time-based billing had “proved remarkably resilient”, the survey suggested the reason was that fixed fees were “not yet a decisive issue” for clients. It continued: “Law firms seem to be well aware that clients will often stop short of absolutely insisting on alternative fees if the other elements of their offerings are attractive.”

The researchers found that although firms often mistakenly believe individual clients are happy to be contacted remotely, in fact many clients – 66% in the case of those aged over 55 – wanted face-to-face communication. Also, a majority felt it was important that firms provide online case tracking, although only 8% felt the absence of such facilities would be a deal breaker when selecting a provider.

Peppermint concluded: “What the survey has [shown] is that while there is scope for innovation in the commercial legal services, business clients are not yet ready to throw the baby out with the bathwater.

“Old-fashioned customer service and strong relationships remain critically important to business clients and new entrants that try to win market share based on price or technological innovation are unlikely to prove successful. But if they can provide both (as well as innovative fee structures) while also preserving the traditional lawyer-client relationship, then the future could look very different indeed.”



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