Do We Really Need OLM (OnLine Marketing) With Blogs?

This article, The Future of Client Acquisition, Ed Collar (October 6, 2006) extolls the virtues of OLM – online legal match services.  Trouble is, the article is probably 5 years out of date.  In my view, opportunity for legal match services has already come and gone, replaced instead by more sophisticated technology users who can find attorneys through Google ads or blog visibility.

Collar writes that that the $173 billion OLM industry has been around since 1999 and that:

Clients immediately embraced this useful electronically enabled
innovation but attorneys were reluctant, and were a tad skeptical about
replacing their traditional forms of client acquisition with the
uncertainties of the Internet.

Today, these attorneys have a bit of a different attitude.
With the proliferation of the Internet and as bar associations in state
after state issue opinions (overwhelmingly coming to the conclusion
that, when done within reasonable guidelines, online legal matching
doesn’t violate lawyers’ ethics on garnering clients), lawyers and law
firms from Albuquerque, N.M. to Yonkers, N.Y., from Portland, Maine, to
Portland, Ore., are meeting with their accountants and running
“cost-of-client-acquisition” numbers with a new variable inserted —
using intelligent e-commerce as a strategy.

And, perhaps more important: Millions of average people
looking to hire a lawyer have found this new online avenue, and it’s
quickly becoming quite fashionable.

I don’t buy this analysis.  First, the reason that many lawyers hesitated to participate in OLM was the cost.  Many online services hoped to build their success on the backs of lawyers, who were required to front considerable costs – sometimes as much as $15,000 a year – to gain a listing in an OLM service.  And the companies rarely offered guarantees, which meant that if you’d lose a sizeable chunk of change if your participation didn’t yield clients.  In response, the OLM services contended that they could not charge on a “contingency” basis, i.e., where lawyers would not pay up front, but instead, OLM would collect a percentage of any fees generated through the service.  OLM said that the the bars (who else?!) considered this type of arrangement unlawful fee splitting, though truth be told, bar referral services frequently take a cut of cases referred to attorneys.  Moreover, there’s nothing wrong with fee splitting if disclosed to the client up front.

And that’s the real rub; though Collar makes a big issues of how the bars have come around on OLM services, they’ve only come around on the issues that don’t matter anyway.  What we really need from the bars to make OLM work (or at least make OLM claims transparent) are rulings that cost sharing between OLM and lawyers is permissible.  If OLM could have implemented cost share programs,  it would have attracted more lawyers and the programs would have grown much more rapidly.  And, if despite bar rulings allowing cost sharing, OLM programs still required hefty sums from lawyers up front, the OLM companies’ true motives (financing themselves through lawyers) would have been clear up front.

In my mind, that’s the reason why OLM never took off: because cutting edge lawyers taking advantage of the internet were doing so precisely to save money, and were not willing to buy into a costly service with no assurance of results.  And in a fast moving internet
world, when something doesn’t work, another superior method generally
comes along.  Here, that replacement is blogging.  Blogging gives
lawyers visibility and an opportunity to strut their substantive
stuff.  As the public grows more comfortable with the Internet, they’re
going to run google searches to find lawyers, rather than visit a
“middle man” OLM site.  And because OLM doesn’t offer a fraction of the
search engine visibility that blogs do, lawyers will again question
whether it’s worth while to make a considerable investment in OLM.

Don’t get me wrong – I’d love to see OLM services succeed, because
online referrals give clients yet another option for finding a lawyer.
But the way I see the OLM market going, unless the bars change their
position on cost sharing between OLM services and lawyers such that OLM
services reach a reasonable price point, OLM will simply become another
expensive advertising tool for personal injury firms (like the yellow
pages and television) while other lawyers, will generate clients from
their blogs and websites.  What a waste of a potentially useful
technologies.