Competition among personal injury lawyers is intensifying despite substantial consolidation in the market expected over the next 18 months, according to First4Lawyers.
First4Lawyers, through a snapshot survey of 65 firms and an analysis of statistics from Google and the Broadcasters Audience Research Board, noted increasing advertising spend and costs both online and on TV.
Clinical negligence work is attracting significant interest in particular, as it’s seen as a more positive environment in which to practice, First4Lawyers said.
These findings were made despite negative sentiment in the personal injury market, with 42% of respondents revealing that their profits had fallen over the past year, and 43% seeing staff numbers fall.
Nearly half of respondents to the First4Lawyers survey said the costs of doing business had increased, with a third having boosted their investment in marketing.
Despite a fairly bullish outlook for the year ahead, with 69% expecting profit, and 76% turnover, to rise, respondents were less positive for the claimant market as a whole—most expect an increase in closures, mergers, WIP sales and redundancies over the next 18 months.
The results were against a background where 47% saw no likelihood of the government watering down the reforms in the Civil Liability Bill.
In terms of turnover, profit and staff numbers, clinical negligence specialists were significantly happier with the past year—30% said profit had increased, while it stayed the same for 61%—and 43% predicted profit to rise over the next 12 months, with 36% also expecting more work in that time.
First4Lawyers’s review of personal injury marketing showed a steady increase in the volume of advertisers across all areas of personal injury and clinical negligence during 2017. As such, the general cost of marketing has increased month on month.
The market has seen more and more firms diversify into clinical negligence, which is having a direct impact in the cost of marketing.
There were 50% more advertisers online in Q3 2017 than in Q1, and this is driving increased competition, with the average cost per click increasing by more than 70%.
In most advertising categories, there has been a 15 to 20% increase in the number of advertisers but in some areas, such as work accidents, there are more advertisers than ever before.
First4Lawyers saw more advertisers driving high bidding strategies to achieve higher positions for intense periods of the working day. This is driving the overall increased spend levels.
TV advertising is also surging: there were more than 135,000 personal injury and medical negligence adverts on TV in Q3 2017, which is more than 1,500 per day.
The volume of adverts was up 39% compared to the same quarter in 2016, and 18% compared to Q2 2017.
First4Lawyers managing director Qamar Anwar said: “Whatever the outcome of the government reforms, there will still be injured people looking for legal assistance. The question is where they will go and our analysis of the market shows that firms realise that they have to raise their game and their profile.”
“It is not an easy time but the smart firms, with clear strategies and effective marketing, will ensure that those injured people have access to proper advice, rather than leaving them to the clutches of unqualified chancers.”