March of the big brand
Date: 15 April 2011
Authors: Jon Robins
Issue: Vol 161, Issue 7461 + 7462
Categories: Opinion
Jon Robins offers some predictions on how deregulation will affect the legal services market
Lawyers talk about “Tesco Law” and the ongoing liberalisation of legal services, as though the 6 October start date for alternative business structures (ABSs)will mark a latter day “gold rush” led by big name supermarkets and banks. But what do the consumers want? Do they really want to buy their legal services through Virgin, the Co-Op or—for that matter—KwikFit? It’s a blindingly obvious question but one that is all too infrequently raised.
Recent research from the pollster YouGov reveals that, yes, around six out of 10 (60%) of adults are interested in receiving legal advice from well-known brands. The most popular being Barclays (19% would consider them), followed by the Co-Op and AA (18%). Tesco who has lent its name to the movement (but shown little interest in it) also scored highly (16%) as did Virgin (15%). Not everyone was a winner though. Apparently, you might be able to “get better than a KwikFit fitter”, at least when it comes to legal advice (they scored only 1 per cent.
The brands are coming
“The brands are coming,” reckoned the authors of the report (which is published by YouGov’s SixthSense arm). But they also said that most respondents had “yet to be convinced to purchase legal services from non-traditional suppliers like banks and building societies, supermarkets, high-street brands motoring organizations and others”.
Yet the research isn’t likely to calm nerves on the high street. Whilst it reported “some interest” in the possibility of conveyancing services being offered by banks and building societies it also found, when contemplating a house move, less than half of respondents (48%) were “very likely” to go to a lawyer. Such a scale of threat to a staple of legal practice will be deeply alarming to a section of the profession apparently in denial and which made its voice heard in this month’s last minute vote held in secret at the Law Society on whether the Solicitors Regulation Authority becomes a licensing authority for ABSs. Whilst a “no” vote would have been a two-fingers to change that has been a long time coming (and a futile gesture), it attracted significant (but minority) support.
I read the YouGov report with interest, not least because I was the author of a report (Shopping Around: What consumers want from the new legal services market, Jures May 2010) that drew on a similarly sized poll also by YouGov of more than 2,000 less than a year ago. Consumers were then 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%) (not included in this month’s poll), the big news was that more than half remained unmoved by the prospect of the household names (54%). We concluded that there was “everything to play for” as far as high street lawyers were concerned.
While the YouGov respondents might not have got their heads around non-law businesses moving into legal services, the new market entrants have been working on their plans for years. To take one example, Eddie Ryan, managing director of the Co-Operative Legal Services, explained two years ago how the provision of legal services was “a really good fit” with the Co-Op’s “principles and ethos” (Big Bang: Opportunities and threats in the new legal services market, Jures, 2010). “Members feel warmth and an allegiance to the brand,” Ryan said: “We are hoping those brand values translate to legal practice.” The retailer’s legal services arm began five years ago and now employs 370 staff.
Legal luxury
The Co-Op was acutely aware that many of the 15 million shoppers that pass through its stores every week (and, as they do so, hear the in-store radio and read the till displays promoting legal services) will regard the law as a luxury that they can’t afford. As Ryan put it, Co-Op members “tend to be in the C2/D social class grouping”. “They aren’t the sort of people who have a couple of hundred quid in their pocket to get hours of legal advice and they are not the sort of people who feel comfortable in solicitors’ offices.” The Co-Op aims to be one of the first ABSs come October.
The problem that solicitors’ firms face in this new market is visibility—or their lack of visibility. Just over one in 10 of the YouGov respondents (11%) had heard of Irwin Mitchell—and that was the best known firm. It is a sobering thought, and a reminder of the challenge ahead to those lawyers putting their weight behind QualitySolicitors and other initiatives trying to establish recognisable legal services brand. The headway has been made by QualitySolicitors on the high streets of England and Wales (170 branches in less than one year) has been impressive; but it has some way to go and much money to spend on TV campaigns to create a meaningful impression on the greater public conscious.
Quality
The old notion of the “family solicitor” looks set to be a quaint relic of yesteryear. According to YouGov, only 14% of adults have used the same solicitor for more than one legal process over the last decade (although “recommendation” was by the far the most important route to a lawyer). In absence of any recognition factor consumer will gravitate towards the familiarity of the big brand and, as Professor Richard Moorhead has argued, in the absence of the means to make a decision on quality, brand becomes “a proxy for quality”.
Jon Robins is a freelance journalist and the author of the Big Bang and Shopping Around reports mentioned in the article. The next article will consider the issue of quality in the post-LSA environment
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