Over the last decade, there have been significant shifts in the brand rankings of the US-headquartered Big Law firm brands. 

Our latest Top 50 law firm brand rankings and analysis show that whilst there are not a lot of changes from year to year, looking over a more extended period shows some seismic changes – some big risers and some big fallers.

The strongest Big Law firm brands are becoming relatively stronger.

Brand is not about logos; brand is strategy made visible. A stronger brand gives a law firm better leverage in the competition for high-value work and more ability to maintain premium pricing (i.e. avoid discounts when it does land the work), which translates into higher profitability.

The systematic publication of detailed performance data in the Big Law sector makes it uniquely possible to analyse and rank the relative brand strengths of the largest firms robustly and consistently, effectively tracking actual client behaviours, not simply canvassing their opinions.

(See the end of the article for details of our methodology and an explanation of the direct correlation between brand strength and overall profitability).

 

 

The rise and rise of the global elite

Unsurprisingly, the strongest Big Law firm brands are becoming relatively stronger compared to their close but not quite close enough competitors. It happened decades ago in all other professional services sectors where a dominant Big 4/5/6 has emerged that gets ahead and stays ahead.

For a while, the Big Law market seemed to defy gravity in this sense. However, since 2010, several firms (like Kirkland and Latham) have evolved their strategies to focus on US and international growth, particularly in London.

Since 2010 these firms have been able to exploit their ‘home’ market advantages and turn them into increasingly global aspirations in ways they’d previously eschewed.

Brand is not about logos; brand is stratgey made visible.

The long view

Our decade-long perspective shows that, whilst year-to-year changes in brand rankings are primarily subtle, taking a longer view shines a light on some pretty dramatic changes.

Some firms have outperformed their peers in brand strength to the point where – if it were sport – they would have been promoted to a higher league. Similarly, some firms would by now have been demoted.

Although these rankings are solely based on the data firms provide to the American Lawyer every Spring, the firms leading the ranking are increasingly the strongest ‘global’ law firm brands.

However, due to the quirks of the UK tax year (which runs to April 5th), the true global picture will only become apparent later in the year when we will publish our global brand index.

Incremental improvements year-on-year can have a transformational impact.

Upwardly mobile

Kirkland & Ellis retains its dominance as the strongest Big Law firm brand and increasingly looks unassailable in its no.1 positioning. However, it’s worth remembering that the firm was ‘only’ ranked 4th in 2010. It’s not had success handed to it on a plate.

Latham, Gibson, and Skadden continue to maintain their rankings. Although Skadden has let the others catch up since 2010, when it was ranked no.1. It’s important to note that whilst these firms have been in the top 5 of law firm brands for some years now, they continue to build brand strength even faster than their followers.

Morgan Lewis and Ropes & Gray have had an incredible brand-strength decade, leaping into the top 10 from ranking 23 and 20, respectively. Given that firms might only move a place or three in any one year, their success shows how incremental improvements year-on-year can have a transformational impact.

Quinn Emanuel, King & Spalding, and Cooley have each leaped up more than 20 places in the top 50 rankings since 2010.

Again, consistent improvement in brand equity over a decade has taken these three firms from being ranked in the bottom third of the top 50 to firmly established in the top 20 most valuable brands.

Paul Weiss, Goodwin, Covington, and Holland & Knight also deserve honourable mentions for rising more than ten places since 2010.

This analysis shows that whilst they’ve been moving forwards, their peers have moved much faster.

Losing ground 

The biggest fallers since 2010 in the top half of the table are Hogan Lovells, Cleary, Norton Rose and Wachtell.

Each of these firms has a different story behind their relative decline in the rankings.

Hogan Lovells has suffered somewhat from its relative over-exposure to the UK and European markets over the last decade when most of its Am Law competitors are US-focused.

Norton Rose, like Hogan Lovells, has bedded down a major merger during the last decade, and Cleary has had a bit of a more challenging time than others.

Wachtell is another story entirely. The firm continues to dominate PEP rankings whilst eschewing expansion.

Nice problem to have, you might say, if you’re a current partner. But what about the long-term future of the brand? Is their strategy to be the IB equivalent of a Lazard or Rothchild in a world dominated by firms like Goldman Sachs?

Or, taking an even longer view, do they want to be Maserati or Mercedes?

Further down the table, O’Melveny, Reed Smith, Morrison & Foerster, Vinson & Elkins, and Orrick have lost ground to their peer firms since 2010.

Interestingly, inside each of these firms, things probably feel fine. PEP has steadily risen since 2010.

But this analysis shows that whilst they’ve been moving forwards, their peers have moved much faster – either by growing the premium of their brands, expanding the reach of their brands, or both.

And finally, spare a thought for Shearman, who dropped 28 places from ranking at no.24 in 2010 to falling outside the top 50 in 2023.

Roaring Twenties?

Looking ahead, will this be the decade where a global elite of Big Law firms finally emerges, leaving an unbridgeable chasm behind them?

Law differs from accounting and consulting regarding conflicts and the number of different roles in many deals and disputes. And what’s the magic number of global elite firms that the market will settle down on? Ten, fifteen, twenty?

How different only time will tell. And unlike these other sectors, there are likely to be significant niche strategies and brand positionings that firms can exploit if they find themselves on the wrong side of the chasm if it appears.

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Economics sidebar – why total partnership profits are a good measure of relative brand strength in Big Law*

Ranking the 50 most prestigious US-headquartered firms by their ‘global partnership profits’ gives a rigorous and substantive basis for assessing their relative brand value and strength over time.

The key to this insight lies in the underlying dynamics of the global law firm market, which, although quirky in many ways, is, in economic-theory terms, a reasonably frictionless or ‘pure’ market (lots of competitors with relatively low market share, low barriers to entry/exit, similar products and excellent price visibility).

In other sectors, profits can be heavily influenced by ownership of critical IP (pharma), regulations and licences that thwart competition (telecoms), assets that bar entry (energy), effective monopolies or oligopolies (big tech), etc., none of which applies in any significant way in the premium legal market.

Firms only succeed commercially if they compete effectively year in and year out for what they earn. And because the purchase cycle is relatively short, clients can react quickly to any perceived changes in the relative competitiveness of any one firm.

Being a relatively ‘pure’ market, individual firms (and their partners) compete based on three components: reputation (what those who’ve experienced you think about your service), relevance (what problems you’re perceived to be best at solving and where geographically you solve them) and visibility (how well known you’re known to the clients around the world who have those problems – and the budgets to pay for your services).

These three components combined comprise a firm’s ‘brand’ – the combined brand equity of the firm and its partners (who also have brands of their own) – arguably the only source of sustainable competitive advantage that a law firm has.

It’s helpful to point out that being a ‘stronger’ and more valuable brand overall does not necessarily imply being a ‘better’ brand for every occasion. For instance, the Mercedes brand is regularly measured to be approx. Ten times as valuable as the Ferrari brand ($50bn vs $6bn), but that doesn’t mean that Ferrari isn’t a strong brand in its niche. It’s just not as valuable overall because, relative to Mercedes, its niche is tiny.

*Due to the different result publishing cycles, the largest UK-headquartered firms are not included in these rankings. These firms will be included in September 2023, when we publish our Global Top 50 rankings.