The first post “Loyalty and The Funeral Industry (part 1)” has created great responses. When I say great I mean many responses, not all them happy with me. I was particularly pleased to find out that my readership includes some “big company executives” that I suppose perpetuated the old Southern saying “a bit dog always yelps.” I’d like to remind readers that I am sharing my experiences and perspectives from being a funeral industry product/service provider, a funeral service provider, and from funeral consumers themselves.
When I took the leap from the field sales role into entrepreneurship of developing and owning a funeral home, I wanted to take a different approach. First, I wanted to learn all I could about funeral home operations, processes, the consumer and the markets that I intended to operate. Because I had no shackles of legacy keeping me bound to “we’ve always done it this way” (a phrase I abhor), I initiated what I was taught in the military called a “table top exercise.” I went on home removals, facility removals, sat in on arrangements, studied P&L statements, etc. and basically categorized what I believed to be each step of the process on paper. Yep, I wrote down every step, one by one. Simultaneously, I studied the principles of Six Sigma to create a template of process to overlay of my observations.
One of the most important steps during this process was listening to families during arrangements. Obviously I could not ask families anything, however I created questions later to be asked in a focus group. The focus group study was conducted in another state with a similar demographic of the first location to be opened. The issue of funeral home brand loyalty was important because we had no brand or name within the community and we wanted to know how to attract families to our new approach to service.
We had 2 sessions with consumers (about a dozen or so in each, multi ethnic) that had at some recent point made arrangements for a funeral of their loved one. In a focus group study you may know that the questions sought after are not always asked “point blank,” but they are woven into the process.
One question was “if a new funeral home opened in your town, say in a former bank building in a nice area, would you use that location?” Some of the respondents raised their hand, but only a few. For those that did not, the question was asked why? Basically, they did not know anything other than it being a new funeral home and didn’t know who was involved which would make them reluctant. The facilitator went on to other questions and then came back around asking “if that new funeral home in the bank building had licensed funeral directors, perhaps with a history of service, would you then give them a try?” About 2/3 of the participants raised their hands indicating yes. Again, the facilitator moved to other questions and then settled on prices that they actually paid at various local funeral homes. We had already surmised the local average of burial and cremation costs by conducting a GPL survey.
We found it interesting that the participants responded with all sorts of dollar values. The facilitator had to further explain that he was looking for the price of the burial services/casket or cremation services/urn only, not cemetery, outer burial container or obituaries (quite a lot of negative response on obit costs). Finally, the question came back to “remember that new funeral home in the bank building, operated by licensed directors with experience or credibility?” “What if that funeral home offered similar burial services and caskets for at least $2000 less, would you use the new funeral home?” All the hands went up. Then “if this same new funeral home offered similar cremation services and urns for at least $1,000 less, would you use the new funeral home?” Again, all hands went up responding positively. So there was one of the answers we were seeking; there is a point where loyalty has a price. This group offered us quite a bit more from how/where they got their information (internet, newspaper, television, etc.) to importance (or lack of) having the actual product on hand or digitally presented would sit with them; all important elements of creating a new operating platform.
We have experienced success at our new brand of funeral service because of this and other “listen to the consumer” processes put into place. Asking the consumer to provide us information prior to actually physically coming to the funeral home either on home removal or online was met with positive response. Basically, my theory of getting all the “data collection” out of the way early and focusing in on the life lived was right. Our proprietary TouchPoints arrangement system engages families in a co-creative process, not a “inquiry of data.” We made tremendous strides operationally including the death certificate prepared prior to arrangements, digital presentations, consumer engagement via social media which all created a positive funeral experience…building loyalty the new way.
In development, I knew that price was not the compelling reason because other factors are even more important. I always hear “well, you get what you pay for” in many circles when new competition starts eroding market share. Again, back to the car analogy; the next funeral you have look at the make and models of the cars on the lot (if there are a lot of Buick’s, you are in trouble). The consumer will decide the value proposition.
Frankly in my opinion (and we all know I have one) loyalty must not only be earned, but maintained. Just because your firm has been serving since Sherman burnt down the South does not dictate loyalty. Continuous improvement is sometimes painstaking and changes must be made. A great example of this is a dear friend of mine that has been in the business 35 years and is an owner of a firm serving a local community, primarily Italian, since the early 1920’s (yes, he’s from “up North” and my friend). The traditional families his firm serves for over 90 years has shifted to a nearby township leaving his location in the middle of a demographic market that has completely changed, including real estate values. The families still come to him, but he realizes at some point they will begin to look elsewhere for many reasons. Being proactive, he made a decision to follow the families by moving the entire operation to the township where the majority of his market has moved. His summation is that he needs to follow his market, not stubbornly resist the inevitable. Go into cities and look at boarded up churches…consumer shifts from not only location, but from traditions. Sound familiar? I think someone famous once said “go where they are.”
One last observation I personally experienced learning about is online funeral consumers. By paying attention, we found that families were seeking online services from other states for their deceased loved ones right in our operational zip codes only because our locations were conducting the trade work. So what did that mean? This particular segment of consumer had no “relationship” with a local funeral home (including ours), searched online, and made a choice based on the information found on a website. Now I know what some of you will say (yes, I know who you are). “Well, we wouldn’t do the trade-work which is perpetuating the whole thing in the first place.” Don’t. The family clearly did not choose your firm in the first place for whatever reason, why not at least get some revenue from the transaction? Being proactive, we addressed this consumer segment accordingly. The online funeral consumer segment is growing. If you think about it, this is the epitome of no loyalty.
So, what’s your firm doing to create and maintain brand loyalty including capturing the folks in your zip codes looking elsewhere? Why are they seeking funeral services by some other firm that yours? Perhaps your website is not suitable with information (really, take a look at funeral home websites, I dare ya), or the prices you charge may be out of balance for the market (and the consumer has to come see you to get them at your location in a bad area of town). “Networking” at the Lions Club is going stale, “marketing” by obituary placement in the local paper, restaurant place mat ads and printed calendars is failing.
“We’ve always done it this way” is not the answer for loyalty in the funeral business. As usual, I am looking forward to the responses prompted by what I shared. As always, don’t shoot the messenger (however I have been shot at before), but let’s have lively discussions. So from the Command Post and through a blur of cigar smoke, Cheers y’all! #thefuneralcommander