Laws of attraction
Nicola Laver discovers how conveyancing firms can exploit the price transparency rules to attract clients
There are few things more galling for conveyancing solicitors than being undercut by cheap conveyancing providers (estate agents’ commission is undoubtedly a close contender).
So, it’s promising that the new price transparency rules could undermine the ‘bargain basement’ business model relied on by other conveyancing providers.
It is not often that solicitors can exploit regulations to their advantage, but these rules offer a ripe business opportunity for conveyancing solicitors who strongly value service over price.
The evidence is that firms are observing the rules not merely as a compliance exercise, but as a tool to attract new clients and to counter the cheap quotes being churned out by bulk conveyancers.
The price transparency rules were introduced by the Solicitors Regulation Authority (SRA) as part of a continued drive to increase transparency in public-facing services.
They apply to residential conveyancing and a handful of other areas, such as uncontested probate.
The result is that regulated firms offering residential conveyancing must publish clear, transparent pricing information to potential clients.
The rules do not oblige firms to publish every permutation of the potential costs a client may be charged, indeed, the SRA acknowledges that a binding quote is often not possible anyway. But they must publish minimum information as prescribed by the rules.
Value versus cost
Given that unregulated firms are not bound by the rules, bulk conveyancing firms will continue to ply their trade by offering a cheap service.
But now that solicitors must clearly publish their pricing information, would reducing their fees to attract business be a wise move?
David Keighley, a solicitor and trainer in residential conveyancing with 40-odd years at the coalface, points out that this rather depends on the philosophy of the practice.
“You have got those who are happy to chase the costs spiral downwards (which is basically chasing turnover over profit, I suspect), but the best way to differentiate yourself from thecompetition is to sell on quality rather than on price”, he says.
Few solicitors would argue with that, but the reality remains that cheap conveyancing services will always attract a percentage of the public who are governed solely by price.
Keighley says the rules provide an opportunity to differentiate yourself from the competition – to show how you add value.
But how can conveyancing solicitors respond to the rules without compromising on costs? Amanda Holden, head of residential conveyancing at The Wilkes Partnership says the new price transparency requirements can only be “a good thing” for law firms.
“It is important for clients to be able to compare like for like and not find that they are hit with hidden costs when they are too far involved in a transaction to feel that they can switch solicitors.”
The problem is, clients are not yet necessarily aware that this information is available to them on all conveyancer’s websites and Wilkes is still receiving email and telephone requests for quotations.
The price transparency rules also require full disclosure of any foreseeable cost – a requirement that in practical terms works against bulk conveyancing firms. Richard Atkins, residential property partner at Taylor Walton, points out that the consumer is “buying someone’s time and not a commodity”.
He explains: “Our experience is that clients are not impressed by a budget airline style of pricing model where cheap headline fees mask the true cost. Equally, they can distinguish between a remote factory style service which you might expect to be cheaper than your local high street solicitor, but often isn’t!”
The bottom line is, consumers are not stupid. They will see through any attempts to entangle them through lower quotes than what they will be charged in reality. They can differentiate between a cheap but impersonal service offering and a pricier but efficient, personable service.
Atkins says: “Being open and honest about pricing with full upfront disclosure gives our clients the confidence that all their dealings will be conducted in a similar vein. And this builds trust from the outset.”
Can any concerted marketing drive or clear published pricing model produce greater results than truly satisfied clients?
Perhaps not, at least for many firms of the same ilk as The Wilkes Partnership. “The work that we do is our most effective marketing tool”, says Holden.
Most of the firm’s work comes from existing clients or recommendations from existing clients, though the firm is not solely reliant on this.
Rather than entering into referral agreements with estate agents, it advertises locally, networks with local businesses, works on strengthening relationships with local banks, and makes use of social media and the firm’s website to increase enquiries from potential clients and to attract new business.
Let’s not forget potential business clients. Businesses looking to buy or sell residential property will be seeking to instruct firms who can provide a cost-effective service while knowing exactly what it will cost them.
In its report on price transparency in the legal market, the SRA said that its research “suggests that those firms that do publish price information could benefit from increased contact from small businesses as their expectations about the costs of using a solicitor is lower when costs are publicly available”. Businesses want financial clarity not gimmicks.
Choose your market
Looking beyond pricing information to your target market is vital. Atkins believes the key to attracting conveyancing business is to choose the market you want to compete in and differentiate yourself from those offering cheap conveyancing quotes.
If you differentiate on price alone, you are likely to attract too much of the wrong sort of work. For example, Taylor Walton uses experienced and qualified people who look after each client personally.
“These one-to-one relationships combined with our local knowledge is vital”, Atkins says. There is also the trusted relationship the firm has built up with other local professionals which can benefit the firm’s clients and often speeds up the conveyancing process.
Atkins firmly believes conveyancing is usually best conducted locally, not least because of the rise in fraud in conveyancing - the firm is finding that clients feel more comfortable dealing with someone local who they can see exists and who they can visit in person.
It has always been difficult to compete with cheap quoting firms but building personal relationships is key.
Holden says: “[Wilkes] does not profess to be the cheapest but we aim to offer a personal service by qualified members of staff. This is not a unique selling point as so many other firms offer the same and so it is in building personal relationships that we are able to win new work.
This benefits the firmas a whole as clients then tend to consider us ‘their solicitors’ and will defer to us for all of their legal needs rather than for just their conveyancing work.”
Tech and testimonials
A proper case management system is, of course, essential to driving business efficiencies in any legal sector, and is undoubtedly a crucial tool to win the business in the first place.
Keighley advocates for a proactive system, which can “generate an automatic quote while on the phone so that it is actually emailed out to [the client] or sent to them by text”.
However, he adds “even if you do give a quote, for heaven’s sake, follow it up and give them a call!”
The beauty of technology is that your firm’s website can be updated whenever you want, so if a satisfied client has given you a glowing testimonial of your conveyancing service, have you published it?
Client testimonials are a modern trend and, if used carefully, can prove a valuable marketing tool – which is just what Taylor Walton is doing.
Reviews and testimonials are seen as the unbiased voice of real people, says Atkins, and they work because they help to establish trust and convert potential clients.
He says client testimonials are “a strong endorsement of the service we offer and we are keen to promote these to new clients when we have the opportunity to quote.”
A testimonial request is sent out to all its clients after completion and the firms generally receive a 30 to 60 per cent response rate (this varies month by month).
You should be under no illusion that every testimonial will be positive. As Keighley points out: “There will be times when people will leave a bad review, but that’s life isn’t it? The reality is, you have got to try and be open – that it is not just me telling you that I am good, that I will return your calls, and so on, but have a look at what other, real people have said.”
Estate agent referrals
Getting clients in via estate agents is no new thing, but are referral arrangements with estate agents still an efficient economic model?
Keighley’s view is that if you have local independent estate agents who are prepared to work with you and provide a quality service to their clients, then that obviously works quite well for both parties.
However, many agents are very much target driven and may be referring people to their panel or their referred solicitor knowing full well that they are going to give them a really rubbish service, but they are getting a fee out of it.
The effect, says Keighley, is that “you have got no choice but to take on enormous quantities to try and generate some sort of return. I do not see how it could possibly work if you are trying to combine quality of service with paying large chunks of your fees to estate agents”.
Some firms have already made the switch from SRA to CLC regulation in a bid to match the competition, but is this always a good move?
While hiving off a firm’s conveyancing department and going for CLC regulation works for some firms, Keighley is somewhat cynical.
In his view the only difference it makes is to free you up from some of the restrictions that the SRA imposes on acting for both parties to a transaction as the CLC regulations in that respect are a lot looser.
In fact, he highlights a distinct advantage in remaining under SRA regulation: “I do not know whether the public really know the differences between a licensed conveyance and a solicitor, but I think the solicitors’ firm that does more than just conveyancing can offer a far more rounded service in terms of access to other people, for instance, if something crops up during the course of the conveyancing transaction which means they need to talk to somebody in the trust department.”
This option is not available for the client of a firm which deals with nothing but conveyancing. Which brings us back full circle to the issue of added value. Conveyancing solicitors need to make themselves stand out from the competition and sell the positives.
Keighley encouraged firms with an existing client base to engage with that client base: “Make them realise that they are not forgotten about simply because you have now completed the transaction.
The best thing you can have is somebody who is really happy with your service. You retain their loyalty, but their loyalty may well spread out to their circle of friends and acquaintances – and you can only really do that by offering a good service in the first place.”
As conveyancing law firms consider how they can attract more business, the SRA has handed a new business opportunity to them on a plate.
What is clear, however, is that their response to the new price transparency rules need to be considered in tandem with your existing marketing efforts to have the most profitable impact.
Nicola Laver co-editor of Solicitors Journal and a former solicitor