BTI has done a number of market research studies on major law firms. Most recently, they interviewed more than 180 Corporate Counsel of Fortune 1000 clients from August through October 2003. Some of the more interesting things the survey found include:

BTI research shows client satisfaction slumped to 30.6% from 35.6% last year. Clients are less happy this year than last. Corporate counsel face new demands and pressures. The pressure comes on three fronts: 1) legal demands, 2) management issues - that is running their departments and meeting business demands and 3) risk management - finding the new unknowns and predicting where the new issues will come from.

Clients not only face new high-profile legal and compliance issues, they face new reporting demands as well. Most general counsel are reporting their progress and making assessments to their management more frequently. Clients tell us that their law firms are often more of a burden than a help. The corporate counsel we interviewed cited four problem behaviors:

1. Law firms show increased complacency
2. Lack of proactive thinking around new issues
3. Unresponsiveness to requests for changes in work process and protocol
4. Little response to request for timely progress and budget reports

Fortune 1000 clients now spend an average of $13.9 million on law firms.

Clients are doing more due diligence when hiring a law firm. Clients find that they learn more relevant information about law firms from their informal networks. The number of clients that rely on informal networking as a source of hiring more than doubled to 32.2%.

As clients evaluate, reevaluate and hire new law firms, we found recurring reasons that prevent law firms from getting hired. Few of these have anything to do with legal skills. The biggest reasons include:

• Poor (or no) chemistry with the client
• Law firms being unresponsive
• Failure of law firms to differentiate themselves

Overall, 52.7 % of AmLaw 200 law firms are losing market share while 69.6% of clients are hiring new law firms. This is a big money game as clients add millions to their outside counsel spending. More sustainable fees and client spending share is going to the primary law firms that deliver superior client service. In fact, only two primary law firms will get more than 50% of the increase at each client. Everyone else will get a smidgen.

We recommend the following to stake your firm’s share of increased spending and to boost client satisfaction:

• Catalogue one short-term, high-impact risk management idea from each practice head in your firm
• Review your client’s legal strategy with your client
• Prioritize your client’s top five risks, with your client
• Measure and target client retention rates
• Find out what clients are really saying about your firm

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• The Selling Process: How To Create Effective Marketing Campaigns
• Determining Client Net Worth
• Create A Marketing Plan: Step 2 - Knowing Your Current and Past Clients
• Not Just Email Spam
• Your Marketing Plan Should Address These 3 Groups

Categories: Client Service