Tuesday, August 15, 2006
Branding and Law Firms
Over at Conglomerate, Gordon Smith has posted a comment on Vic Fleischer's case study on the branding effect in the MasterCard IPO and similar thesis on the Google IPO. Gordon asked why farmers organize into coops and suggests that it has as much to do with branding (say, as "organic" farms) as with governance.
It's a fascinating subject, and the following comment has all the hallmarks of a blog post - quick, anecdotal, and wholly ignorant of most real scholarship on the topic. But I want to offer two not-so-hypothetical hypotheticals about law firm branding.
1. My first appearance in court was three or four days after the swearing in ceremony in November, 1979. A partner asked me to cover THE NEXT DAY a hearing in the Ann Arbor District Court (the court for matters less than $10,000) on a motion to dismiss a complaint in which the pathetic plaintiff had sued the wrong one of our scumbag client's multiple corporate entities. And the sorry thing was that suing the right one wasn't going to help because the statute of limitations had run (assume no fraud here, just slickness competing against incompetence). The brief had been filed; I spent four or five hours prepping, and I slept maybe three hours (complete with all the classic stress dreams, like taking a final in a math class I had forgotten to attend), worrying about the hearing. I have mentioned before that when I was twenty-five I looked like I was about eighteen, but when I walked into the courtroom, and said "May it please the court (I don't think lawyers usually used that form of address in the Ann Arbor District Court), Jeff Lipshaw of Dykema, Gossett, Spencer, Goodnow & Trigg appearing for defendant Global Scumbags, Inc." there was , to my mind, a palpable reaction from judge and opposing lawyer that could not have been attributable to my person. DGSG&T (now known merely as Dykema "A Law Firm Unlike Any Other") was the 800-pound gorilla in Michigan, and the brand had to put a patina over anything I was saying.
2. Many years later, when I was buying services, firms like Dykema and its equivalents in other non-financial center cities (other examples of the type would be firms like Reed Smith in Pittsburgh or Bryan Cave in St. Louis or Dorsey & Whitney in Minneapolis or Baker & Daniels in Indianapolis or Preston Gates in Seattle - not firms necessarily that bid for our work - but of equivalent size and reputation) would market for deals that inevitably ended up in Wall Street firms (and, by the way, not in any New York City firm, but in a select group of NYC firms). If you merely looked at the bona fides of the individual lawyers put forward - schools, academic records, deal experience - there was no real basis for explaining to them why it was that we were willing to spend double the amount per hour to hire, say, Skadden or Weil or Wachtell, to do the deal. You could make actual value related arguments, but I don't think they were ever really supportable. To my mind it had to be the brand.
Indeed, both as a law firm partner and as a buyer of services, I made the argument to those fine firms that there were areas in which the brand was perfectly fine. For example, there is no branding reason why you could not establish a national center for ERISA or partnership tax in St. Louis. But for bet-the-company M&A work, the firms were wasting their precious marketing dollars competing against the goliaths of the industry.
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