LexisNexis Bellwether Report 2025 Review

LexisNexis Bellwether Report 2025: A review

Focussing upon small tweaks with big impact is an interesting topic, and the Report delivers great insights as ever. Read on for my overview and you can also read the Report here.

Also, kudos to LexisNexis for avoiding building a report entirely focussed upon the AI chat that is dominating every single piece of law firm consultancy or advisory content that I see currently. Is AI important and potentially game changing for law firms? Yes. Should it be the sole focus for law firm leaders? Absolutely not. Is it included in the report? Yes, but proportionately.

The Bellwether research methodology and participants

I always like to start any review with a look into the methodology applied to the research, and I’m always particularly interested to see how many respondents replied, their seniority and the spread of the response between firms of different sizes. I think it’s really important to understand these figures, especially when it can be so easy to take headline percentages at face value.

It is particularly important to be diligent where a) response numbers are low and b) where junior lawyers are disproportionately represented. There’s nothing wrong with including responses from those at the start of their career, but it’s true to say that most, if not all, of them will have no real idea of the pressures and challenges faced by those running the firm that employs them.

Unfortunately, information about seniority isn’t included in the below, so again remember to take all of the figures with a pinch of salt and do try to apply your own judgement and experience to the findings and supporting comments.

Here’s the methodology:

“The Bellwether 2025 survey, conducted in April 2025, gathered responses from 308 legal professionals across England and Wales. Firms of all sizes were represented, with 26% from practices with five or fewer fee earners, 23% from firms with six to ten, 29% from those with 11 to 20, and the remaining 22% from firms with over 20 fee earners.”

M&A down, organic growth up

Six in ten or 48% (148) respondents confirmed that their firm has grown over the past 12 months, an increase from 28% on last year.

M&A focus declined from 10% in 2024 to 5% this year, with 72% of respondents aiming for organic growth. There are a couple of different respondent comments on the reasons for this drop which include the cost of M&A (mergers tend to be cash hungry – requiring legal, financial, HR, compliance and reputational advice). Remember also that managing and completing a deal is massively time-consuming, leaving little or no time for those leading to concentrate on anything else. 

There’s also a comment that organic rather than M&A growth ensures that law firms retain full control of all aspects of the business, along with a suggestion that cultural cohesion may play a part in choosing to grow with what you’ve already got.

Spending now, spending later

Spending priorities reveal some interesting insights. Hiring has become more of a priority, with 23% having already undertaken this step with 39% planning to in 2025. 17% have already spent on technology investment and 43% intend to this year.

16% of respondents increased spend on marketing, and 33% plan to increase that spend this year. 11% increased spend on business development, with an even bigger planned increase to 36% in 2025. I think this is a slightly slippery set of figures as I’m almost certain that if you asked even two lawyers in the same team to define marketing and business development, they’d both almost certainly come up with different answers.

It will be so interesting to see whether these proposed spending increases come to pass as, in my experience, they tend indicate an increase in confidence in the market. When confidence is low, marketing and associated cost tends to be one of the first to be cut.

Interestingly, the report authors come to a slightly different conclusion with regards to the above statistics stating that “Some firms have already increased their spend in these areas, but instead of acting in the moment, the majority are planning for the future.” This suggests less confidence than I’m predicting.

Clients just want more

Unsurprisingly enough, since we see it in every single sector report, pesky clients still want more, for less, as quickly as possible.

“80% of respondents saying clients now expect faster communication and quicker answers. While that figure has dipped slightly from 83% in 2024, the message is the same: responsiveness isn’t just appreciated, it’s assumed.”

There’s still a real focus upon pricing, with 50% of respondents explaining that clients want clearer, more upfront fee structures, up from 44% last year. This trend reflects broader economic pressures.” I’m not sure I agree with the final sentence, I think it has ever been thus.

Interestingly, one respondent, an associate at a small firm said, “Clients always should come first, then cost and outcome second.” There’s a lot to unpick with this comment.

Yes – client service should of course be prioritised, but I’m not sure that a) the client would be happy for you to automatically put service before cost (you’d have to ask them obviously) and b) I’m fairly sure that many, if not most, wouldn’t prioritise service above outcome.

On a separate note, and again with regards to the cost point – who is paying for that gap between excellent service and cost, if the client decides that they don’t want exceptional service? My answer – the law firm, in recorded but unbilled fees. Or billed but unrecoverable fees.

I think more broadly this associate’s response probably puts into words the challenge that many law firms have: helping fee earners to understand the importance of not only accurately recording the time spent but also making sure that this translates into accurate and representative billing. And lastly ensuring that what you deliver is what the client wants and is happy to pay for.

Top Concerns

Compliance continues to keep respondents up at night, with 40% identifying it as a significant challenge and 29% as a quite significant challenge. 69% feel that staying up to date with legal industry changes is a challenge.

Unsurprisingly, attracting new business is a top concern for 69%, with retention also getting top billing at 60% citing it as a major issue.

The report also briefly touches on reputational and PR matters, when discussing the importance of referrals for smaller clients identifying (what I have also long been saying) that “even referral traffic is largely dependent on some prior research from the client – your website, LinkedIn profile, client reviews etc. – to prove your legitimacy.”

Turning to AI… (of course)

It wouldn’t be a sector report in 2025 without a section on AI… but here’s the stand-out point – adoption remains cautious.

“Use of open web tools for research is now widespread: 72% of lawyers said they use Google, legal blogs, AI tools like ChatGPT, or legal forums regularly, either frequently or very frequently. Only 7% said they never use the open web, down from 9% in 2024.”

Although there is some appetite then for AI specifically, the sector more broadly struggles to utilise data or analytics. This is surely a missed opportunity for many, as there are now so many tools available for law firms to do this.

It would be a shame for the sector to leap into the AI revolution, which is still in its infancy and unproven in legal, whilst failing to access and utilise mature technologies (specifically relating to data) that are already tried and tested in other sectors.

“Almost half (46%) of firms said they do not use data or analytics at all. Of those who do, only 27% use it for tracking individual or team performance, 18% apply it to pricing strategy, and another 18% use it for gathering client insights. Just 11% reported using historical data to assess risk.”

The report sums it up perfectly: “Small firms are exploring new technology, but many are still missing a major opportunity to turn their data into a strategic asset.”

But what is preventing growth?

37% cited the economic climate, 34% said a lack of time for business development and almost a quarter of respondents outlined fear of change, (there’s a spello in the report so this figure is either 23% or 24%).

Just 2% identified that poor client retention is an issue – this is a fascinating statistic as experience tells me that lawyers often love nothing more than a ‘new’ client. Does this mean then that client retention just isn’t a ‘thing’ for the respondents – do they not care about retaining clients? Is it arrogance – ‘our clients would never go anywhere else’? Does it point to a lack of data – do they actually understand or measure your retention rates? Do they care? Remember that growth is so much more easily achieved via your existing and lapsed clients than by trying to attract other firms’ clients.

The ‘busyness’ result is also interesting, and I’d love to have the opportunity to unpick it with some of the respondents. Where is all of this busy work coming from, and is it converting into profit and, most importantly, cash? What is the recovery rate on all of this time spent? Are these lawyers raising and sending invoices and collecting payment on what must be really significant levels of WIP?

Or are the lawyers spending the time, failing to recover or bill, and are the partners flushing cash away through tax and high salaries? I could honestly spend hours thinking about this stuff!

I have a feeling that busyness and a lack of time for business development probably aren’t the real issues here though. I suspect many firms just struggle to convert time-spent into cash-recovered. In an ideal world, any lawyer who has so much work that they have no time for business development should be absolutely raking it in for the firm. Are they though? And if not, who is monitoring what they are doing, and who is willing to have those difficult conversations?

I digress though.

This year’s Bellwether Report is, like every year, an interesting snapshot on the sector, and a great read for anybody either in practice or who works alongside or sells to lawyers. I really hope you’ve found my review interesting and insightful.

If anybody is interested in 2024’s Bellwether Report, you can read my summary here.