In the new "Regional Law Firm Brand Indexes 2022", we see how traditional law firm differentiators like historic reputations are shifting in favor of more specific legal expertise.
As law firms continue to deal with the slowly waning crisis of the pandemic, they are looking to help their clients navigate this still-uncertain landscape. As they do, both clients and their external law firms are gaining a strong understanding of how critical it is that both sides invest in maintaining these strong relationships.
Thomson Reuters’ newly published Regional Law Firm Brand Indexes 2022 (download below) shows how those law firms that were able to forge the components of strong client relationships — such as establishing high firm favorability and brand awareness in the minds of clients — saw the most growth in this year’s Indexes. The new Regional Indexes covers the legal markets in five separate countries or regions — the United States, the United Kingdom, Mainland Europe, Canada, and the Asia-Pacific region.
Each Index is based on data compiled in 2021 from Thomson Reuters Sharplegal study; and the sample of surveyed organizations is random across each individual country or region with all major industries and sections represented to consistently allow for reliable benchmarking.
The Indexes are not a reflection of technical competence alone, however; it is a reflection of which firms are upper-most in clients’ minds, to which firms clients are most attracted, and to which they are most likely to give their most important work. How the regional rankings in the Indexes change over time shows which firms are doing a better job of making and maintaining a meaningful relevant impression with clients through experience, relationship development, and alignment with clients’ goals and needs.
Overall, the data shows that clients in almost every country or region are planning to increase the level of their legal spend in 2022. Indeed, it appears that the lingering impact of the pandemic has kept organizations’ legal budgets robust and corporate law departments’ reliance on outside counsel at a high level. Add to this a booming M&A market in many areas around the world and it’s no surprise that those firms most quickly climbing up the Index are well-situated in clients’ minds for top-level M&A work.
From a brand perspective, a post-pandemic shift was clearly going on across all regions. Traditional law firm differentiators like historic reputations or relationships with individual lawyers gave way to other factors such as clients’ need to have fast, trustworthy advice from their external counsel. The rapid response aspect of legal work was increasingly important to clients, especially as in-house lawyer workloads continue to grow.
“In 2021, as businesses emerged from the crisis, legal service buying patterns focus on forward-facing factors like understanding the client’s business and knowledge of their sector,” explains Elizabeth Duffy, Senior Director of Global Client Services at Thomson Reuters. “And we still see clients prioritizing specialist expertise over historical relationships or reputation.”
Indeed, standing out in today’s legal marketplace requires firms to hone an ever-evolving set of skills. What once was considered solid differentiators in recent years have turned into table stakes as clients continually push for higher standards in legal service delivery. Simply put, the bar continues to rise. For example, responsive law firms no longer stand out as unique, nor can they tout their responsiveness as anything beyond what is an expected norm. However, newer skills — like being proactive communicators — do still allow a firm and its key lawyers to stand out.
Similarly, the idea of understanding your client’s business is simply expected; and without it, client satisfaction can drop precipitously. However, delivering commercial-ready advice is one of the most effective ways outside law firms can still differentiate themselves and earn a larger share of clients’ legal spend.
As more client businesses try to put the harsh depths of the pandemic crisis behind them, legal demand is becoming more focused on these forward-facing factors, such as how well law firms understand their clients’ business and market sector. And as we continue to move through 2022 and beyond, we will increasingly see clients all around the world prioritize this kind of specialist expertise and reward those outside law firms that can provide it.