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May 26, 2014

What’s Gone Wrong At Martindale-Hubbell?

Graveyard2

What has happened to the largest and best known legal directory in the world?

The once-dominant force in legal directory publishing.

In a piece by consultant Stephen Fairley, the author asks “Are Martindale-Hubbell and Lawyers.com Dead? Why Every Martindale Client Should Care” – accompanied by a picture of Doctor Death looming over Martindale’s corpse.

Two events in late 2013 solidified the view, that while a going concern, Martindale is now so different to its previous form, that it is in essence is no longer the same product.

Firstly, in August 2013, Martindale-Hubbell announced a joint venture with online marketing company, Internet Brands, best known in the legal sector for its Nolo division.

Nolo, which was acquired by Internet Brands in April 2011, offers consumers a range of online documents and other legal resources.

A portfolio business of private equity firm Hellman & Friedman, Internet Brands offers lead generation services across numerous industry sectors, and in fact started life as CarsDirect.com.

Then a few months later, following the joint venture, more than 200 jobs were axed at Martindale and sister company Lawyers.com.

The job losses were announced by Martindale owner LexisNexis, which said that the roles would be performed in the future by the Internet Brands team in El Segundo, California.

The joint venture sealed what had been happening for some time: Martindale’s transition from a traditional legal directory product to a marketing solutions company for smaller law firms – mostly in the United States – offering services like website design, hosting, SEO, and lead generation.

Once just as well known among BigLaw and international law firm circles, Martindale had been moving away from larger law firms for some time, and now seems to focus almost exclusively on offering smaller law firms packages of online services.

Its transformation has been so marked that the difference between Martindale and lawyers.com, the latter traditionally the consumer focused part of the offering, has become less obvious.

A number of commentators addressed the concerns of thousands of law firms that have Martindale and Lawyers.com packages.

For example, per Stephen Fairley:

“How is Internet Brands producing the SEO, social media, or blogging content for the thousands of loyal law firms who continue to pay for these services every month when everyone who did the work was fired?”

“How do changes get made to attorney’s websites when the New Jersey building where all the workers who did this work is currently sitting empty and on the market?

“Why should law firms continue to pay for a listing on Martindale when nothing is being done to drive traffic to the website?”

There’s a healthy discussion on LinkedIn around some of these issues.

According to reports, Internet Brands plans to grow Martindale-Hubbell.

Although it’s early days, and we shouldn’t be too quick to judge, there doesn’t seem to be much evidence of that.

To be fair to Martindale, the company’s VP said in a recent interview with the ABA Journal that “we’re far from dead.”

This might all sound like the final whimpers of a dying animal, but let’s not forget that Martindale-Hubbell has existed in some form since 1868.

That’s incredible when you think about it.

In 1868, the British armed forces began a campaign against the Ethiopian Empire, and US president Andrew Johnson was impeached.

At its peak, Martindale carried around 1.2 million lawyer listings – probably 40 or 50 percent of all the lawyers in the world at the time – and had annual revenue in the hundreds of millions of dollars.

Most legal directories are nowhere near this scale.

Kevin O’Keefe at LexBlog reflected on its storied name in a blog post last year

“Martindale was an impressive publisher, a legacy company, that provided lawyers a valuable service for over 100 years. The Martindale rating was the gold standard. During my 20 years in law school and practice, every lawyer looked up lawyers and their rating – whether because they were on “the other side” or to find a lawyer with whom to associate.”

The modern era at Martindale began in 1989 when it was acquired by Reed International, the large UK-based publishing company, for $303 million.

As part of the sale, the private interests led by the Carolan family that formerly controlled Martindale, ceded power to a more corporate style of management.

Richard Carolan, a prominent Armenian-American who died in 2002, was chairman and CEO of Martindale-Hubbell until shortly after the Reed deal.

Even back in 1990, there was an indication of the direction Martindale would take over the next 20 years.

The deal announcement at the time talked of “synergistic benefits” for Martindale-Hubbell and R. R. Bowker, another publisher that was acquired by Reed in 1985.

A senior R. R. Bowker executive was appointed to lead Martindale-Hubbell after the corporate takeover.

Post-acquisition, Martindale maintained a strong presence around its traditional headquarters in New Providence, New Jersey, but over the next 20 years, it got subsumed into the huge Lexis Nexis operation with its global tentacles.

Martindale’s parent company is the massive Anglo-Dutch listed multinational, Reed Elsevier (formerly Reed International), which announced annual revenues of $10.1 billion in 2013.

It’s hard to believe that a business with such deep pockets and 150 years of brand building behind it couldn’t figure out how to make a legal directory work in the modern world.

I’m sad that such a venerable name has effectively been handed to a consumer business without the same pedigree in the legal sector.

Sure, Internet Brands is a successful business, with tons of websites attracting gazillions of hits.

And, yes, I know it’s a joint venture, not a sell out, but it feels like Martindale has given up the ghost to me.

When I got in to the legal sector in the late 1990s, Martindale was still regarded as the legal listing/directory of record for most lawyers and law firms around the world.

It was hugely influential.

So how did we end up here?

Martindale’s current plight stems from the early part of the 2000s.
 

The Internet

 
The internet has not been kind to Martindale.

Although it moved online quickly and had a strong web presence long before most other directories, the democracy of the web weakened Martindale’s once-powerful brand, which was established in the pre-internet print era.

These days, people typically turn to Google and other search engines rather than go direct to legal directories like Martindale or Lawyers.com.

As a result, law firms started to plow resources into their own websites, search engine optimization, and other digital marketing initiatives.
 

Expensive

 
Martindale was expensive, eye wateringly so at times.

Large law firms were regularly hit with six and seven figure bills for directory listing packages throughout the 90s and 00s.

I was involved in the decision to cancel or reduce Martindale listings at a couple of law firms.

They were difficult decisions, because the firms still wanted to advertise in many cases– they didn’t want to cancel their listings – but the fees became impossible to justify.

Martindale had corporate mouths to feed and was often unwilling to negotiate much.
 

Inefficient

 
As well as the profile listing fees, large firms had to employ staff to manage the onerous task of completing and updating the attorney bios and profiles.

This was fine when Martindale was the definitive place of record for lawyers worldwide, but as law firms developed their own websites, this became an expensive and inefficient duplication of effort.

Law firms started pouring their energy into their own websites from the early 00s onwards, rather than working on Martindale.
 

Rating System

 
Older lawyers might disagree, but Martindale never really nailed ratings.

Partly because it was a first and foremost an information tool – that was its culture – not an assessor of law firms.

And that’s fine – there’s room for products like that.

But Martindale never seemed sure how far to go with ratings, and how much influence to attach to them.

The AV rating had cache, but it was never nuanced enough, and superseded by other rating products.
 

Social Media

 
Martindale got left behind in the social media race.

Sure, it tried with Martindale-Hubbell Connected and other services.

But it couldn’t complete with LinkedIn, blogs, and other social media sites, which offered a powerful and lower cost alternative.
 

All Things to All Men

 
Martindale embraced a wide range of products and services for law firms rather than concentrating on its core business – being the best international lawyers directory.

I can understand that in a large business, you have to respond to a changing market, and look for new revenue sources, but Martindale was spread too thinly.

Martindale reps were constantly badgering lawyers and in-house law firm marketers to pay for extra products and services.

There was a relentless drive to package more and more stuff under the Martindale banner.

At one point, the Martindale website was so packed with ancillary services, it wasn’t clear that it was a legal directory.

Although it tidied up its website in recent years, the site was too cluttered for a long time.
 

Corporate Ownership

 
Large multinationals aren’t always the best owners of legal directories.

Despite their resources, they’re too big, too lumbering, and decisions have to pass through endless meetings and committees.

The rationale with Martindale made sense: the information on all the lawyers and law firms could be used to sell those same firms Lexis Nexis legal research and information products.

But sometimes big isn’t always better.

A lot of successful legal directories are run by smaller, private companies, who can make decisions more quickly, apply a personal touch, and aren’t answerable to shareholders and the public markets.
 

Competition

 
For many years, Martindale successfully fought off other products that sought to emulate its success.

However, the rise of Avvo, which launched in 2007 and is now arguably the most heavily trafficked legal directory site in the US, didn’t help Martindale.

Avvo and other new entrants presented a high visibility, lower cost alternative.
 

What Now?

 
Most people think Martindale is finished, but I don’t think the game is up.

I would like to see the owners hive off Martindale to a small staff who want to refashion it into something new.

They could create an internal “skunkworks” – the term used to describe a group within a mature business that is given autonomy to develop a specific project free of any interference.

Assemble a crack team of 50 of the most creative IT people, designers, social media experts, SEOs, and legal marketers.

You don’t need hundreds of people and large, expensive offices to run a legal directory these days.

Shove them in a loft in a run-down part of some cheap town, give them a small budget, a blank canvas, tell the executives to leave them alone, and set them to work.

It likely won’t happen because these large companies are obsessed with wringing every penny out of their existing customers, rather than try something bold and new.

But it might just work.

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Filed Under: Legal Directories Tagged With: Martindale-Hubbell

By Lloyd Pearson

Legal directories consultant serving law firms worldwide.

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