New levels of technology adoption point to a future of cloud-based legal services that extend beyond physical borders
26 October 2021—Vancouver, BC—Today, Clio, the world’s leading provider of cloud-based legal technology, released the highly anticipated 2021 Legal Trends Report, which illustrates the market for remote legal services—and how law firms are in a better position today to meet the growing demand.
Following on insights from last year’s report, which showed significant levels of technology adoption among law firms, this year’s research indicates that new technology-enabled capabilities are part of a longer-term shift that will be further driven by consumer demand for more remote-enabled legal services.
“We’ve reached a new punctuated equilibrium in technology adoption, and this has set us on a trajectory for a dramatically reshaped future of legal,” said Jack Newton, CEO and Founder of Clio. “The consumer demand for more remote legal solutions is undeniable, and Clio is leading the vision for the legal operating system that will enable the next generation of legal practices.”
Consumer demand for remote legal services reaches unprecedented levels
In 2018, only 23% of consumers were open to working with a lawyer remotely. Now, as uncovered in this year’s report, 79% of consumers see the ability to work remotely with a lawyer as a key factor in choosing who to work with and 67% said they would look for a lawyer offering both remote and in-person options when searching for an attorney.
Fueled by rapid technology adoption, the shift in client demand for remote interactions indicates that law firms will need to continue to adapt to these trends to meet client expectations.
The shift in preference for video conferencing helps illustrate this change in demand. In 2018, less than 5% of consumers indicated that video conferencing would be their top choice for communicating with a lawyer at any point in their matter. In 2021, 58% want the option to have a consultation through video.
Growing firms are embracing cloud-based and client-centered technology
Data from the report also shows that firms using technologies that enable more remote interactions with law firms have seen substantial revenue growth in comparison to other firms. The report looked at technology adoption among firms seeing considerable revenue growth in recent years. The “Growing firms” group identified within the report had on average increased their revenues by 135% since 2013.
When comparing the Growing firms to others, these firms had adopted cloud-based client-centered solutions at much greater rates than other firms. Overall, the Growing firms cohort were:
- 37% more likely to be using online payment solutions
- 41% more likely to use online client portals
- 46% more likely to use online client intake and client relationship management (CRM) solutions
Each of these solutions gives firms the ability to work with clients remotely through enabling online payments, sharing electronic documents and other information, and managing intake with electronic forms. The success of these firms underscores the importance of understanding how to effectively harness the benefits of these flexible technologies in an ever-tightening and highly competitive market.
Law firm spending indicates lawyers are prioritizing more remote capabilities over physical office space
Data from the report shows that when it comes to financial spending, firms are focused less on investing in physical office spaces and more on enhancing their digital capabilities with practice management software.
Survey data shows that legal professionals are most likely to see legal practice management software as a significant expense (67%), and they are most likely to spend on additional software in the future (61%). Office space was where law firms were least likely to invest (27%). The implications of these investments indicate that as a whole, the legal industry will be more prepared to create more tech-enabled client experiences.
Online payments have set new standards for law firms
This year’s report also uncovered a continued upward trend in the demand for convenient online payment options in the legal process. Online payments (66%) were the most preferred method for paying for legal services, followed by automated payment plans (61%).
While Growing law firms are 37% more likely to use online payments than other firms, the report highlights that all firms have seen steep adoption rates since 2013.
Simultaneously, when it comes to making legal services more accessible through flexible payment plans, Clio continued to see an increase over the last year. In 2020, 72% of consumers reported a preference to pay for legal services using payment plans, while this year 81% reported that a firm’s ability to offer payment plans influences their hireability.
Remote solutions create valuable market opportunities to reach new clients
Previous research indicates that many Americans are unable to access legal services—and many rural communities are disproportionately underserved. According to an ABA study, there are 54 counties that don’t have a single lawyer, and another 182 that have only one or two. But this is not an exclusively rural problem. According to the World Justice Project, 77% of legal problems don’t receive any legal support.
Remote technologies offer law firms the advantage of delivering legal services to underserved markets by eliminating geographic barriers. Lawyers based in urban centers can work with rural clients; lawyers can also operate out of more remote locations to serve urban markets.
“Technology provides new flexibility and convenience that benefits both lawyers and their clients,” said Newton. “Through the lens of technology and innovation, the potential to increase access to justice cannot be underestimated.”
For six years, Clio has published the Legal Trends Report, now widely considered the trusted resource for insights into the current and future state of legal. Using the aggregated and anonymized data from tens of thousands of legal professionals and surveys from both lawyers and consumers, Clio constructs a holistic picture of the legal industry today, and what the future trends are likely to be. The 2021 Legal Trends Report is available for free at clio.com/ltr.
Clio is transforming the legal experience for all through cloud-based and client-centred legal technology. Clio has become a company to watch on a global scale after securing a US$6M Series B investment in 2012 by German-based Acton Capital, a US$20M Series C investment in 2014 by Bessemer Venture Partners and one of the largest investments in legaltech and Canadian history in 2019 with a US$250M Series D funding round led by TCV and JMI Equity. In 2021, Clio made history again by becoming the first legal practice management unicorn globally with a US$110M Series E investment led by T. Rowe Price Associates, Inc. and OMERS Growth Equity. Learn more at clio.com.
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