Page 103 - MASTER COPY LEADERS BOOK 9editedJKK (24)_Neat
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Leaders in Legal Business
not necessarily in real terms). As a result, many U.S. firms rightly see the U.S. as a primary market for
development. The U.S. legal market is not just about New York. Washington D.C., Chicago, Atlanta, Houston,
Boston, Los Angeles, and San Francisco, to name but a few, are all major centers of legal services, and many
would probably rank in the top 10 cities of the world in terms of legal spend.
Our strategic alliance partners, Altman Weil, track mergers involving U.S. firms3 and 2012, 2013, and
2014 were the three most active years ever in terms of U.S.-related law firm mergers. This is no surprise, as firms
have been seeking to develop the depth and breadth of practice across the key U.S. markets. Some of these mergers
have or will create $1 billion or $2 billion firms in their own right. The U.S. as a whole, is still a relatively
fragmented market, but if this merger trend continues over the next few years, a far smaller group of truly national
firms will emerge, operating at different levels in the market. It has to be appreciated that once these mergers are
integrated, it can be expected that many of these firms will use their size and financial strength to build even more
significant international practices, either by further mergers, team hires, lateral additions, or Greenfield openings.
Branding and Recognition
Many firms have established strong reputations in their local markets, regionally, or internationally for
particular types of work. Outside the legal community, however, it is often surprising how little recognition there
is in the wider business world of law firm names and what they do. In global branding surveys, law firms tend to
rank quite low and often a few hundred places below the Big Four accounting firms. Some would counter that this
does not matter, provided that they are known and recognized by their current and future clients, and to some
extent this is correct. However, in an era of national, regional, and global consolidation, branding will assume
greater significance. General counsel are increasingly reviewing their law firm relationships and tending to
significantly reduce the number of law firms they use both nationally and internationally. This is increasingly
important to law firms, as if they “miss the cut” on a panel review they risk being excluded from future work for
that client.
Branding does not mean the firm’s name or its logo. What it means is how the firm is positioned in its
market, what it stands for and what the client can expect in terms of expertise, service delivery, and cost. Put
simply, a brand is a promise: “If I buy that brand I know what to expect, and it will be delivered consistently
wherever that brand is displayed.” Legal services firms have found it troublesome to develop a level of
differentiation from their peers, as they argue that legal services are fundamentally indistinguishable except in
terms of quality or price. This is probably too simplistic, as industry knowledge, client empathy and efficient
service delivery are increasingly important to clients. Any meaningful differentiation, however, is not easy to
achieve; it can also be discussed in terms of differentiating a small group of firms from other players in the market.
For example, when one talks of the Big Four accounting firms, there may be little to distinguish between Deloitte,
EY, KPMG and PWC, but they are clearly, as a group, providing a fundamentally different offering than all other
accounting firms in the market.
Probably the most comprehensive research done into legal brands is undertaken by Acritas. Its 2014
global brands survey illustrated the following:
3 ALTMAN WEIL, http://www.altmanweil.com/mergerline/ (last visited January 27, 2015).
96
not necessarily in real terms). As a result, many U.S. firms rightly see the U.S. as a primary market for
development. The U.S. legal market is not just about New York. Washington D.C., Chicago, Atlanta, Houston,
Boston, Los Angeles, and San Francisco, to name but a few, are all major centers of legal services, and many
would probably rank in the top 10 cities of the world in terms of legal spend.
Our strategic alliance partners, Altman Weil, track mergers involving U.S. firms3 and 2012, 2013, and
2014 were the three most active years ever in terms of U.S.-related law firm mergers. This is no surprise, as firms
have been seeking to develop the depth and breadth of practice across the key U.S. markets. Some of these mergers
have or will create $1 billion or $2 billion firms in their own right. The U.S. as a whole, is still a relatively
fragmented market, but if this merger trend continues over the next few years, a far smaller group of truly national
firms will emerge, operating at different levels in the market. It has to be appreciated that once these mergers are
integrated, it can be expected that many of these firms will use their size and financial strength to build even more
significant international practices, either by further mergers, team hires, lateral additions, or Greenfield openings.
Branding and Recognition
Many firms have established strong reputations in their local markets, regionally, or internationally for
particular types of work. Outside the legal community, however, it is often surprising how little recognition there
is in the wider business world of law firm names and what they do. In global branding surveys, law firms tend to
rank quite low and often a few hundred places below the Big Four accounting firms. Some would counter that this
does not matter, provided that they are known and recognized by their current and future clients, and to some
extent this is correct. However, in an era of national, regional, and global consolidation, branding will assume
greater significance. General counsel are increasingly reviewing their law firm relationships and tending to
significantly reduce the number of law firms they use both nationally and internationally. This is increasingly
important to law firms, as if they “miss the cut” on a panel review they risk being excluded from future work for
that client.
Branding does not mean the firm’s name or its logo. What it means is how the firm is positioned in its
market, what it stands for and what the client can expect in terms of expertise, service delivery, and cost. Put
simply, a brand is a promise: “If I buy that brand I know what to expect, and it will be delivered consistently
wherever that brand is displayed.” Legal services firms have found it troublesome to develop a level of
differentiation from their peers, as they argue that legal services are fundamentally indistinguishable except in
terms of quality or price. This is probably too simplistic, as industry knowledge, client empathy and efficient
service delivery are increasingly important to clients. Any meaningful differentiation, however, is not easy to
achieve; it can also be discussed in terms of differentiating a small group of firms from other players in the market.
For example, when one talks of the Big Four accounting firms, there may be little to distinguish between Deloitte,
EY, KPMG and PWC, but they are clearly, as a group, providing a fundamentally different offering than all other
accounting firms in the market.
Probably the most comprehensive research done into legal brands is undertaken by Acritas. Its 2014
global brands survey illustrated the following:
3 ALTMAN WEIL, http://www.altmanweil.com/mergerline/ (last visited January 27, 2015).
96
