For the past couple decades, big law firms have been the “norm” as far as how to practice law and the preferred way to go for both budding lawyers and for clients. The last few years, with the economic downturn forcing every industry to cut costs, there has been a sea change as far as how people–both practitioners and their clients, corporate or otherwise–have been approaching the practice of law. Clients were demanding lower costs and more personalized service. Attorneys were seeking a better work-life balance and wanted to be able to implement their vision of how law should be practiced. Up came the niche boutique firms, the virtual firms, and of course solo practitioners (both forced entrepreneurs and voluntary solos). It seemed like the legal world was one big oyster with many pearls, not just one pearl and a bunch of sand.
However, after reading this blog post it dawned on me that the Big Box Retailer of law, the big firm, is fighting back to get the market share they have practically been giving away the last few years. With their vast resources, they can out spend all the little guys to win over the clients that had been avoiding the big firms. They have basically adopted the supermarket method of creating a “loss leader” in hopes of getting the “little” clients that have strayed to the small firms. Once they grab their market share back, the small guys can no longer compete. It’s much like mom & pop hardware stores competing with The Home Depot. At first the small guys could offer products that Home Depot couldn’t or wouldn’t carry. Once Home Depot became the hardware store, it made no sense to go anywhere else because there was nothing different with little hardware stores besides price. The same can be said about Wal-Mart, IKEA, Best Buy, and so on.
Is this the Rise of the Big-Box Legal Retailer? Are big firms trying to take back what’s theirs? I think in the short term it will look like the big firms will appear to squeeze out the little guys with their endless resource pool. However, in the end a reasonably-priced, good-quality product always prevails.
People know that free isn’t always better, but at the same time, people will not pay more for equal products. Solo and small firms are more flexible and adaptable than big firms. Big Firm lawyers are not encouraged to think outside the box. It’s a machine. Although it may be at times difficult to match big firms with their ability to give away more freebies in order to attract business, solo and small firms have the ability to be more creative so they don’t have to. Netflix did not invent video rental. They just thought of a better way of doing it. Good ideas, with a little marketing, always win.
