Focus on the customer

Esther M. Verboon conducted a study into the loyalty of SME clients in the legal services sector and on 17 January 2017 obtained her doctorate at the University of Amsterdam for her thesis on the subject, entitled Focus on the Customer . There has been very little academic research into customer loyalty in the legal services sector and this is the first study of its kind to look at the Dutch legal profession.

In the legal profession, existing clients are generally the main focal point. Because of increasing competition, especially in the SME sector, retaining existing SME clients has become an issue of some urgency, expressed in the following research question: How does loyalty among SME clients who use the services of lawyers come about?

This study explores which aspects of legal services contribute to loyalty among clients. It reveals that clients tend to be loyal if they can appreciate the lawyer's professionalism during the handling of their case. The lawyer needs to demonstrate both customer focus and expertise. If clients have a good impression of the lawyer and their firm, this also contributes to their loyalty. In terms of the loyalty of clients who do not currently have a case with the lawyer, ancillary services, such as proactive advice, appear to be of benefit.

The effect on loyalty largely comes about because the lawyer delivers something in the form of customer values. One important customer value is ‘a good outcome of the case’, which consists not only of a legal solution, but also positive emotions, such as the feeling that worries have been dispelled and that one is in a good position versus the counterparty. Another important customer value is the ‘confidence in the lawyer’ experienced by clients.
The study also covered the influence of client characteristics on the development of loyalty, such as the level of ‘information asymmetry’ between lawyer and client. It is shown that confidence is a more important factor for inexperienced clients than for experienced clients because of this information asymmetry.

In practice, these insights suggest that lawyers who wish to retain their SME clients should present themselves as demand-driven rather than supply-driven service providers. Rather than on their legal expertise, the primary focus should be on what helps the client, i.e. the customer values. In addition, they should invest in the relationship with the client by combining professionalism and customer focus, offering ancillary services and working to enhance their reputation.

The insights from this study are also of interest to other professions in legal practice since client loyalty also comes about as a result of customer values in those professions. Ultimately, lawyers deliver credence goods, which is why confidence in the service provider is an important precondition. Legal issues also have an impact on clients, as does the result of the way they are handled.

Marketing, Market Research and Innovation

Marketing, Market Research and Innovation

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