Between 2010 and 2011, we reviewed a wide range of publicly available information on the legal services market – the Regulatory Information Review (RIR). These pages present the outputs from this review. You can use the menu on the left hand side of the page to navigate through the different sections of analysis.
The purpose of the review
The purpose of this review was to build a comprehensive picture of the legal services market in advance of the impacts of the Legal Services Act 2007 using a wide range of published research. By using a wide range of publicly available information, we sought to develop a robust evidence base, through the collection and analysis of existing data and information on the legal services market, without imposing any burden on the industry, or undertaking research that duplicates existing information sources. This enabled identification of collective gaps in knowledge, and targeting of research activity. The sources used are presented in the information sources section. We have also drawn on this analysis in our legal services market baseline reports.
This exercise was intended to be as comprehensive as possible, but we recognise it is only a starting point. We hope that it will be used and added to by the regulatory community and others. Please email us with any reports or data that you think would add to this. We will periodically update this analysis with the findings of new research as the regulatory community’s understanding of the legal services market grows.
The review process
First we thought about what information on the legal services market was needed to develop regulatory policy and understand change, devloped through a series of workshops. From this we developed a series of questions about the market place that represented our ‘knowledge needs’. We grouped these into 12 different themes, shown in the left hand menu. Further information on the process and the development of knowledge needs can be found here.
We then reviewed over 600 publications to develop a bank of knowledge on which to base our analysis. In 2010, we undertook a survey of the regulatory community to determine what information was held but not published. A summary of the survey responses can be found here. We also compiled the individual professional membership lists and other geographical information into one data platform to enable analysis of the regulated community as whole. Further information on the process and the development of the data platform can be found here.
Defining groups of consumers
Alongside the review, we commissioned economic research to develop a market segmentation framework. The framework identifies five different types of consumer groups the based on the risks of market failure. These groups are:
1. Natural persons – legal aid (Legal aid consumers) - Defined as individuals funded by legal aid, or accessing free at point of delivery legal services.
2. Natural persons – non legal aid (Private consumers) – Defined as individuals buying legal services for themselves.
3. Legal persons small – less sophisticated (SMEs and charities) – Defined as an organisation with less than 250 employees, and no in-house legal team.
4. Legal persons large – more sophisticated (Large business and government) – Defined as an organisation with 250 or more employees, or an in-house legal team. Where the buyer is a government body, but the issue is also encountered by other private organisations, the appropriate classification of consumer type is legal persons (eg the government purchasing legal advice in relation to employment contracts).
5. Government – (Government sole purchaser) - Only applicable where the government body is the sole purchaser—eg for advice in relation to rule-making.This is relevant within areas of public law, crime and issues regarding welfare, benefits and civil liberties.
It is assumed that consumers’ frequency of use of legal services is key to understanding levels of confidence and empowerment. The assumption is that because the private consumer tends to use legal services less frequently than other groups, they have have greater search costs and switching costs. More information on the segmentation framework can be found here.
Defining demand for legal services
Our review summarises published information on demand. For our purposes demand is defined more widely than just existing consumers of legal services. We define demand to cover instances where a problem occurs that can be resolved through legal means but does not result in the use of legal services – a possible measure of latent legal demand. Clearly in some incidences alternative ways of resolving the problem exist, but these operate with reference to the wider legal services market. We do not make any judgements on whether this possible latent legal demand would always need the services of an authorised person (solicitor, barrister, legal executive, cost lawyer, patent attorney, trademark attorney, notary). There will clearly be circumstances where individuals or organisations naturally seek to resolve legal problems without redress to formal services. However based on the findings of our consumer research responses to a legal problem are in part driven by the perception of services offered, and we therefore include all possible incidences in our definition of demand.