Do Legal Tech Companies Lack Coherent Market Strategies?

Robert Ambrogi thinks that this study of legal tech companies' go-to-market strategies (or apparent lack thereof) may be overbroad and overstated.

The takeaway from a new survey of legal technology companies’ sales and marketing can be summed up in one statement: Legal tech companies are confused — confused about what they should sell, how they should sell it, and to whom.

Ninety-seven percent of those who responded to the inaugural Legal Tech Go-to-Market Report, conducted by legal PR and marketing firm Baretz+Brunelle, believe that the legal tech industry has no firm grasp of go-to-market strategy or, at best, a scattered one.

What is meant by a “go-to-market strategy”? The survey’s authors say it refers generally to an organization’s plan for using its resources, including its sales force, to deliver its goods or services to its client base.

Most of the survey’s respondents defined it to include sales strategy, marketing strategy, public relations, strategic communications, and product development.

The survey found that legal tech companies are confused about three significant areas:

  • What to sell. Fewer than half of respondents had a clear understanding of the profitability of their products.
  • How to sell it. Over half of legal tech companies feel there is a disconnect between sales and marketing within their organizations. Many companies fail to strategically budget resources or manage time related to sales and marketing.
  • To whom to sell it. The survey found a “startling” lack of clarity by legal tech firms with regard to the identities of their buyers. When asked whom they sell to, respondents identified a wide range of targets.

The survey’s authors conclude that legal tech companies are losing out on a golden opportunity. The market for legal tech is potentially huge right now, but vendors’ lack of a coherent strategy is keeping them from cashing in.

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Our Legal Tech Go-To-Market Report has revealed, starkly, just how absent that strategic approach is across the industry. We expect that in the months and years to come, the leaders that think most critically about what products they should be selling, how they can most effectively sell them and to whom they should be selling them, will experience the greatest success in the legal tech space. The answers to those questions will be their compass in the land rush that is taking place in legal tech.

Of course, given that this survey comes from a PR and marketing firm, there is also a subliminal message to be found between its lines: Hire us and we’ll help you sharpen your strategy.

My Take on This

My impression of this survey is that its conclusions are overbroad. I have no doubt that many legal tech companies lack a cogent go-to-market strategy. But I strongly doubt that it is anywhere near 97 percent. I likewise have no doubt that many companies are confused about their product and customers, but again, I doubt that it is as endemic as this survey suggests. The fact is that many legal tech companies are highly strategic and successful in their sales and marketing.

One reason the survey’s conclusions may be overbroad is that it surveyed only a slice of the legal technology industry. The survey’s editor, Baretz+Brunelle partner Ken Gary, says that the survey was sent to a wide array of legal technology companies and alternative legal service providers, all with annual revenues in the range of $1 million to $500 million.

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These included eDiscovery software providers, eDiscovery consultancies, document and contract management service providers, LPOs, case and matter management platforms, cybersecurity monitoring services, experience-management platforms, CRM solutions, legal spend management platforms, RFP technologies, legal research companies and translation services providers.

Of those, around 100 responded. All but six were in the United States.

It would seem from the results that the survey skewed towards companies with products aimed at larger law firms and corporate legal departments. Perhaps the most-telling evidence of this were the target customers identified by the respondents. When asked the identity of their buyers, the answers heavily favored corporate legal departments or related operations:

  • 63% – In-house counsel.
  • 55% – Corporate legal operations.
  • 48% – Law firm lawyers.
  • 37% – Law firm executive directors.
  • 37% – Law frim CIO, CISO, CTO, or CFO.
  • 27% – Corporate procurement departments.
  • 24% – Corporate compliance departments.
  • 21% – Law firm CMO or CMBDO.
  • 18% – Other.
  • 11% – Anyone who will listen to us.

When you look at the legal technology industry broadly, there is no way that 63% are selling to in-house counsel or 55% to corporate legal operations.

That leads me to another observation about this survey: That perhaps its conclusions are not only overbroad, but also overstated.

Here is why I say that: Based on the fact that respondents identified a broad range of customers, the survey concludes that companies lack clarity regarding their buyers. But if the survey was, in fact, of a broad range of companies, then it would follow that their customers would vary. The customer a company targets depends on the technology it sells. Given the broad range of legal technologies on the market, of course the range of customers would be broad.

Further, to the extent there is a lack of clarity about who their customers are, this is not entirely due to the vendors’ lack of strategy. The legal market is going through a major shift in the purchasing process right now, with responsibilities in flux. Where once law firms made many tech decisions, legal departments are now stepping in. Where once general counsel drove many tech decisions, legal operations or procurement professionals are stepping in.

Finally, there is another factor at play here that is no fault of the legal tech companies. I have argued in this column before and I continue to maintain that many lawyers resist new technologies. They turn a deaf ear to pitches about products that will enable them to be more efficient. They fear that innovative technologies endanger their by-the-hour business model.

Legal tech vendors cannot be blamed for lawyers’ intransigence. In fact, many legal tech vendors have responded strategically in kind, by refocusing their sales and marketing away from lawyers and onto the lawyers’ clients. Sell the clients on efficiency, sell the clients on cost savings, sell the clients on better results, and the lawyers will follow.


Robert Ambrogi Bob AmbrogiRobert Ambrogi is a Massachusetts lawyer and journalist who has been covering legal technology and the web for more than 20 years, primarily through his blog LawSites.com. Former editor-in-chief of several legal newspapers, he is a fellow of the College of Law Practice Management and an inaugural Fastcase 50 honoree. He can be reached by email at ambrogi@gmail.com, and you can follow him on Twitter (@BobAmbrogi).

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