Automatic lawyer

Home-grown brands such as Saga and The AA have already thrown their lines in the legal services water and The Co-op has made no secret of its intention to develop its own legal offering. Over the summer a number of non-UK enterprises raised the stakes when they declared their interest in the online legal services market. US start-up LegalZoom raised $66m from venture capitalists Kleiner Perkins and Institutional Venture Partners and its founders have made a number of trips to Britain in recent months. It already has a reported annual turnover of $100m and is preparing for stock market flotation.

LegalZoom does not provide legal advice in the traditional sense but offers a number of precedents and build-it-yourself legal documents. To this extent the service differs little from the wills that have been available from the post office. It is far from being the only service of this kind. In August, another US legal online service founded in 2007, Rocket Lawyer, got a $18.5m injection from Google and August Capital, testimonial of the growing interest in the sector.

But LegalZoom's marketing effort has resulted in high media prominence. Its television adverts depict ethnically and socially diverse families going about their ordinary lives. The tone is more reminiscent of private healthcare, insurance services or utility providers; it evokes ease of use and peace of mind '“ miles away from the traditional imagery of stuffy high street firms. It is also very different from the theatrical accident-based footage used in personal injury lawyer adverts still tapping the distress end of the market.

LegalZoom and Rocket Lawyer, together with other online legal services providers, are wheeling in fresh concepts hinting at a new philosophy. It's not so much about legal advice as about online legal solutions, and access to justice is seen in terms of democratising access to legal services.

To date there are no real UK equivalents of LegalZoom and Rocket Lawyer. The nearest is LEGAL365.com, the service launched by Freeserve founder Ajaz Ahmed with Yorkshire-based firm Last Cawthra Feather.

These newcomers are setting law firms an unexpected challenge. The question is no longer who can deliver a better service or offer the best value. It is who sets the benchmark. In other words, can lawyers fight back and start educating consumers about the value of legal services, or are online providers becoming the new models on the legal catwalk? Does this necessarily mean law firms should actively start delivering their services online or can they create a new, hybrid offering where marketing is the first step in service delivery? We started the conversation last week, and here four stakeholders from across the sector give us their thoughts on the topic. JYG

Don't just sit back and let the brands take over: take control and start educating the market, says Jon Busby

Educating consumers of legal services means showing your market a better way, a transparent way, clarity on service, pricing; delivering not just what clients want but also how they want it.

Educating also means empowering. Empowering both the client and the solicitor so they both find additional ways to deliver 'better' '“ a better service delivery; a better solution to a problem.

Solicitors shouldn't be worried about online, it offers huge opportunity to firms of all sizes because online can be blended with the high value of face to face. It is not 'either or'. It is about deploying the most appropriate solution, be that online, face to face, phone or a combination of all of these. It is about letting technology deal with the routine processing such as data capture and the solicitor focusing on the intellectual elements, the lawyering bit.

Solicitors seem to think legal services can be ring-fenced from the change that is going on everywhere else in the world. Many think what will be delivered will be of poor quality or not their client type. This view may be a delusion. Look at VHS v Betamax or Amazon v Borders. The losers here misjudged their market with fatal consequences. Also the demographic of a person who uses online legal is similar to that of a law firm client.

It is easy to assume that major brands will do all the educating. It doesn't have to be like that but it will be the case if law firms just sit back and let that happen. All the online engage/process tools available to brands are also available and affordable to law firms. Where law firms may lack marketing budgets they can offer local accessible expertise '“ to be blunt, a human being. That is huge value. That is worth educating a market about.

Law firms will have to respond if brands educate the market to better ways of engagement when consuming law. If we look around, Apple, Tesco, John Lewis or your local butchers, it is now all about the user or customer experience and that means delivering choice of engagement.

What will define this market over the next few years is focusing on that user experience and delivering it efficiently.

Jon Busby is business development director at Epoq

Embracing the internet will help law firms differentiate themselves from the new entrants, says Stephen Beck

In our new world of IT dominance, the process of delivering law is, in the eyes of many potential clients, far more important than the subject itself.

No one yet knows how alternative business structures (ABS) are going to transform the legal landscape. One thing is certain: it will change, and the most obvious impact will be with online service provision.

That is not to say the development of case management systems, electronic databases, online transactions or social media sites is something to bemoan or indeed that the game is up before the competition really gets going. We have to be far more open minded in approaching these tools and adapt them to suit us.

We have already seen firms dipping their toes into the online world with divorce and will-writing packages, estate administration and document production. This will be the tip of the iceberg as more of our specialisms become increasingly process driven. As soon as you can reduce a matter down to a series of defined steps, you can immediately create an electronic system to handle it and can give the world access to that system through the internet.

This model then allows you to structure your employed capital in such a way that you derive a profit from the process, not through billable hours but by charging a fixed price and managing your expenditure in such a way that you only focus on the bottom line return. Such a structure will be completely alien to many private practice lawyers but is exactly the way the much larger and corporate new entrants to the market will assess return on investment.

There will not be many law firms that will want to or will be able to afford to compete with the likes of The Co-op. So it will be essential for us to differentiate ourselves from them and the internet is one of the key devices at our disposal to do so.

If we are able to construct a business model for online trading that both creates a profit, albeit analysed in a different way, and helps grow market share at the levels sustainable for our business, then we can sit alongside the larger ABS models and still have a thriving business.

Stephen Beck is managing partner at Whitehead Monckton

Change in the delivery of legal services is inevitable, so get ahead of the game and start adapting your firm now, says Simon Stell

There has been much written and spoken about the changes in the delivery of legal services by increased automation and document production.

In reality, law firms have been using automated document creation for many years, relying on precedents and using of case management to produce documents more quickly and more cost effectively. These have been tools to increase efficiencies and managing ever more complex documents in the legal process.

The new era in automated services allows for the wider provision of access to such documents direct to members of the public. It is a natural progression of the delivery of any service industry to look to use the internet to enhance its services, make it more accessible to customers and use technology to reduce the price to end users while still being a profitable business for providers.

The public has, over the years, adapted to using the internet for many of the services and requirements of our daily lives, whether it is for travel, hotels, clothes, insurance or supermarket shopping.

In some sectors access to the internet has resulted in that industry changing and becoming something that is totally different from what it was before.

Those high street travel agents that still remain deal more with specialised travel than the everyday booking of flights and hotels. The motor insurance broker dealing with individuals' renewal of their car insurance has been replaced by price comparison sites and the direct purchase from the insurance company. Many of the services provided to individuals by smaller high street law firms will be replaced by services offered to the customer on the internet at a price and time and in a form acceptable to the customer. If law firms recognise the inevitability of this change they have time to adapt their services to meet the challenge. Change will not happen overnight '“ but it will happen.

Simon Stell is managing partner at LCF and LEGAL365.com

Online education is already here but the value of face-to-face education will save solicitors, says Nick Fluck

The debate about the need to 'educate' consumers about online legal services is slightly behind the pace of change. It would be wrong to underestimate consumers, whether of legal services or otherwise.

Most consumers already have a strong awareness of quality whenever they make a purchase. They are accustomed to modifying their spending habits based on information sourced from the internet, even by smartphone at or close to the point of delivery.

I wonder if those who are hitting the panic button about law firms being left behind when it comes to online legal services really know how 'educated' consumers are. Consumers may not know the law but they are aware that what they want and need is good quality legal advice.

There is already a significant appetite for consumers, seeking quality legal advice, to locate this online. Since September the Law Society's web adverts have been displayed to more than 15 million people searching for assorted legal services, with nearly 30,000 users clicking through to look for local accredited solicitors via the Law Society Accredited Solicitor website (www.lawsocietyapproved.com).

It would be inaccurate to suggest that all consumers want in any product or service is low cost. The rise of consumer review sites like Tripadvisor means that people will turn to other consumers for a subjective idea of what's good and what's not. This is because they are seeking quality.

Online education is already in full swing, and we must maintain it but not ignore the other mediums of education that we have and that the big brands do not have '“ face-to-face service, the traditional, but enormously strong, brand in quality legal services.

Consumers gain their understanding from all areas. It can be from a solicitor's office in the high street, the local paper or work colleague, just as it can be from an internet search on their office computer or smartphone.

Nick Fluck is a partner at Stapleton & Son and deputy vice president of the Law Society