The introduction of Alternative Business Structures (ABS); through the Legal Services Act 2007 and the Legal Services (Scotland) Act 2010, paved the way for a potential reshape of the legal market by enabling non-lawyers to have a stake in, or to even own, a law firm. Since then, a total of 950 licences have been given, with 892 of these still in use as of March 2017. (Although ABSs have not been fully introduced into Scotland, it is understood that the Scottish Government is going through consultation to draft legislation allowing its implementation, and therefore Scotland’s position remains relevant to the discussion of future-proofing your firm). The question therefore is, what is the effect of this on law firms and what can be done to stay competitive in an already saturated market?
Meeting the Mark on Innovation
According to a report conducted by the Solicitors Regulation Authority (SRA), ABS styled firms have higher levels of innovation in comparison to conventional law firms. This innovation was found especially apparent in relation to technology and marketing advancements, where two thirds of ABS firms had been found to have made new investments. The overall legal picture was therefore clear, ABS firms are leading the legal market for innovation.
Staying Competitive in the Legal Market
As the introduction of ABS firms has inevitably increased the competition, especially when some of those with licences have strong established brands, it’s important to remain afloat as the market level rises. The Bellwether Report found that those providing legal services view marketing as the third most significant element in growing their business. Interestingly, solicitors on average spend 1.6% of turnover on marketing while ABS firms spend 3.1%. It may not be possible to match the spending power of the larger ABS firms, therefore it is important to ensure you get the most out of the 1.6%!
What Moore Legal Technology Can Do for You
Five years on since we first addressed the effects of ABS firms on the legal market, the issue is just as prevalent today. (If you would like to watch a short video about our thoughts on ABS, please click here.)
The solution to the problem still remains the same. The first step to competing against those with potentially larger marketing budgets and stronger brands, is not necessarily to spend more, but instead, spend smarter. Sourcing a company with strong expertise in the field of legal digital marketing is paramount to ensuring you receive the best value for money. We continually refine our processes to put you, the client, at the heart of everything we do. From the initial ‘vision’ meeting to our regular catch-up meetings, everything we do is designed to help you meet your goals. We also accommodate different budgets through our standard, enhanced and premium packages. Each package is built to help your firm: increase your turnover, enhance your brand, increase your efficiency and future proof your firm.
Overall, the presence of ABS firms in the marketplace does not necessarily represent a large threat to firms; as perhaps previously once thought prior to their implementation, but it does mean that it would be wise to at least rethink your positioning in the legal sector to ensure that it is as consolidated as it can be in order to provide resistance from any unforeseen market movements.
If you would like to hear more about how you can future-proof your firm against market movements through strengthening your brand, increasing turnover and improving efficiency, then please do contact us at: 01413548862.
Written by Fraser Ramsay - Summer Intern