Do clients follow fee-earners or the firm?

The demise of the “job for life” applies just as much to the legal profession as to other sectors – and not just at junior levels. Recent research into lateral hires which tracked 2,869 partners found that around a third who had been taken on by a firm in 2006 had already moved on by the end of 2013.

The reasons for this trend are unclear; do lawyers jump ship because they feel undervalued or insecure – or is it simply a desire for change and better pay (due in part to the huge salaries offered by US firms)?

Equally important  is does this reduced loyalty of fee earners to firms translate to clients; are clients more inclined to follow their lawyer when they move to a rival, rather than sticking with the firm?

“People, people, people”

In the words of Richard Branson: “Success in business is all about people, people, people”. The all important client relationship, in the context of the legal industry, is generally between the key fee earner (ie the lawyer who deals directly with the client, not just a token partner) and the client themselves (or their key representative).

In a complex case, lawyer and client will form a working relationship which, if successful, will generate an element of trust and confidence and repeat business. If the client needs legal help later on, they are likely to ask to deal with the same lawyer – it’s a similar psychology behind wanting to see the same dentist for each checkup. If the lawyer moves to a different firm, the client will often follow them (subject to substantial fee differentials or geographical changes).

However, the scenario is obviously quite different in the case of routine legal work where the dealings between lawyer and client are minimal – or where there is no continuity in terms of key contacts. In this situation, where close personal working relationships do not develop, the law firm brand is more likely to gain recognition for successful work rather than a partner.

In the case of fresh business, when a client is choosing legal counsel, the failure of many firms to differentiate themselves from competitors means that individual lawyers who stand out from the crowd can be a deciding factor. The presence of a “rainmaker” (ie a senior lawyer who is well recognised in their particular niche, regularly shows up at events and whose opinions appear in the press) can bolster the reputation of the firm and attract new business.

Impact of online presence

Over the past few years, marketers have been encouraging lawyers to engage with social media tools – particularly LinkedIn and Twitter – in order to build their online presence; now many profile pages provide links to Twitter handles and LinkedIn accounts.

Similarly, blogging or commenting on legal news is seen as an effective way of enhancing thought leadership credentials and establishing one’s reputation as a specialist – so links to blogs and articles will also pepper the profile pages of fee earners.

However, social media is a personal medium; it generally only works well when it reflects the personality of individuals rather than projecting a corporate image.

The popularity of blogs is also determined to some extent by the infusion of an individual writing style. So clients are increasingly engaging with the online presence of fee earners, retweeting their opinions, reading their articles and – last but not least – following their career moves via LinkedIn.

This greater connectivity between lawyer and client means two things: (i) clients can form a closer relationship with lawyers who build an effective online presence and (ii) it’s very easy for clients to follow a lawyer to another firm.

In addition to online presence, more informal methods of communication further remove barriers between lawyer and client, which have often been cemented by official-looking printed snail mail bearing imposing letterheads. Snappy emails, chats via Skype and WhatsApp messages allow the relationship between a lawyer and client to flourish and become more like that of colleagues or business associates.

Sharing economy and changing business structures

The shift from formal business relationships to a more personal kind of symbiosis is becoming apparent with the rise of the so-called “sharing economy”. Airbnb is one of the best examples, which allows people to rent out a spare room in their abode to holidaymakers, disrupting the business model of established hotel chains. A key element of the Airbnb model is the encouragement of feedback from both guests and hosts, emphasising the importance of the reputation of both parties.

With ABS and other business models already threatening the partnership structure of law firms, it will be interesting to see if the rise of the sharing economy will also have an impact on the legal sector. Some lawyers may decide to provide a legal service in a similar flexible ad-hoc manner that Airbnb hosts currently provide a hotel service or Uber drivers provide a taxi service – in which case personal reputation will be the main attraction for clients, rather than corporate branding.

Even if the sharing economy ends up being a storm in a teacup, the power of personal branding for lawyers is more important than ever and is likely to continue this way. Although reputable firms may still attract new clients on the basis of their brand, ultimately the success of the brand is determined by the quality of the legal service offered and consequently by the skills and reputation of fee earners.

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