People are increasingly looking for value in legal information, Otago University marketing lecturer Dr Tony Garry says.
Dr Garry says the perceived value of legal information hinges on the speciality of the advice and sophistication of the client.
Law is a credence service, he says, where laypeople use proxies to gauge value – the quality of interaction or even how someone is dressed – to gauge how valuable the service was that they paid for.
“By the same token, it’s very difficult to make any price comparisons. And so for that reason we often tend to have an ongoing relationship with our solicitor because we trust them or they’re friendly to us – and that’s what the economists would call a difficult barrier to break down, if you were a competitor,” Dr Garry says.
“But then you have the more sophisticated client like the blue chip companies or the more educated managing directors and so on. They’re able to make a much better judgement of like-for-like.”
Mr Garry says the commodification of the market means larger companies are demanding more from their law firms for a fixed fee.
Small to medium business, however, would require less sophisticated advice, placing more emphasis on trust and assurance.
“Small to medium – or the sole trader who’s playing with his life work – he tends to be a bit more cautious, and there is room for a long-term relationship to continue.”
Dr Garry says one could view the service in terms of the number of components it has.
He says if legal advice is the technical component, then the ability to gauge the quality of that is often related to the sophistication of the client; such as educational level and life experience.
“Then surrounding that you have the way the service is delivered. For example, how reliable the solicitor or law firm is in delivering that advice, how timely and how responsive they are and so on.
“I guess it’s ‘horses for courses’, deciding where value is added for particular clients (the core or the way it is delivered) and adjusting your service accordingly,” he says.