What to do when a low-price competitor
enters your market
|Author Glenn H. Gould, CEO of MKJ Marketing|
One of the toughest decisions facing owners of heritage funeral homes is whether to respond to a lower-priced competitor, and how to do so. When heritage funeral businesses attempt to define the nature and magnitude of the threat presented by a discount competitor, whether it's a discount funeral home or a minimum cremation provider, they often underestimate the challenge. Sometimes owners are so focused on their traditional competitors, they don't even recognize the threat developing from a low-price rival.
Complacency and arrogance produce blind spots that delay a response and leave incumbents vulnerable. What were Ohio's leading funeral homes thinking when Newcomer began advertising low-price funerals throughout the Buckeye State? What about Church & Chapel in Milwaukee and the Walker Funeral Homes in Cincinnati?
Low-cost competitors build momentum in slow-moving and subtle ways, factors that established players might do well to pay closer attention to. Low-price challengers build their presence quietly by competing in undeveloped segments of a market. How many owners regret thinking the discounter did them a favor by taking the "undesirable" business?
In other cases, competition between low-cost entrants can produce unintended second-level effects that escape the notice of incumbents until it's too late to prevent severe market share erosion.
After all, it isn't very difficult for a low-price competitor to reproduce funeral services offered by a local market-share leader. Nearly all discount operations offer the same caskets, vaults, jewelry and other merchandise as their full-priced competitors. All discounters have chapels and arrangement rooms; some even have on-site crematories and reception rooms.
Taking time to gain momentum
Low-cost challengers start out by taking business the primary firms consider undesirable, or on the fringe of the incumbents' markets. As a result, the initial lost volume is disguised.
Many funeral businesses continue to grow even with a low-price competitor in the market. This dynamic is a particular issue for funeral businesses operating in growing communities, or in rural areas, where market share data is often less transparent. As a result, the incumbents' share of the overall market is falling byt they contue to grow in volume, lulling them into a false sense of security.
Another indicator operators overlook is a suspicious increase in the average sale. Because the discount funeral home attracts those families most likely to arrange lower-priced funerals, an incumbent's average sale will increase as it loses volume.
This is often misinterpreted as a positive indicator, when it is actually just the opposite. Unless something happens to change the trend, the average sale will continue to increase as the incumbent firm loses more and more volume from the bottom up.
Competing with a cremation society is partially a matter of price, but it is also a matter of convenience, and even changing priorities. As a result of the dramatically lower prices offered by minimum cremation services, families create new traditions. Instead of discussing price with the funeral firm their family used for generations, affluent families may make their arrangements on cremation society websites, making payment with credit cards.
One of the most difficult realities for funeral directors to accept is that they can completely satisfy a family and lose the family at the same time. There's a big difference between being satisfied and deriving value. A funeral home can provide the perfect service, and yet the family may conclude that the service failed to deliver something of value.
Mobility can certainly be a contributing factor to this phenomenon. Many families no longer live close together, so having a funeral makes less sense to them. After all, it makes more sense to travel to see a loved one before death occurs versus traveling for a funeral.
Filling capability gaps
Some low-cost competitors grow more quickly than premium players anticipate by offering highly desirable services and finding clever ways to overcome capability gaps. For example, low-priced competitors typically offer more liberal credit terms, including no credit check financing and extended payment terms.
Many discounters start out in minimal facilities, often leased, and typically inferior in terms of d�cor and maintenance. However, when low-cost newcomers get under way, they will begin making quality changes that narrow the gap between themselves and their higher-priced, better-estalbished competitors.
Lower-priced competitors sometimes gain market share through the support of local families who believe their community deserves options in funeral service. Hospice, certain churches and even local politicians are often quite keen to have more funeral home choices in their communities.
Casket suppliers also can be instrumental in the start-up of lower-priced firms, particularly when their company does not have a good customer in a particular town or section of a larger city. Often, the support can include information garnered from the suppliers' other customers, so there is a transfer of knowledge and experience that may otherwise take a decade to accumulate.
The role of second-order effects
The initial impact of low-price players on incumbent funeral homes may not be the most important consideration. If a market is particularly easy to enter (for example, state laws in many northeastern states preclude the sale of preneed, which makes it much easier for discounters to get a foothold) a number of low-price competitors may enter the market.
There might be enough business for everybody at first, but as direct competition intensifies, one or two of the low-cost companies may try to differentiate their offerings and move up in the market. As they do so, they represent a much more direct and formidable threat to the traditional players than the original low-cost strategy, since they typically offer an enhanced product or service built on a low-price base.
Continue reading here: Fighting Back
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DEATH-CARE INDUSTRY or
For many years I have been on a one-woman crusade to change our designation from "industry" to "profession" (even standing up at national conventions and offering my unsolicited opinion) and it seems some headway may be being made, but there is still a long way to go. Note in this month's articles some writers refer to us as an "industry" while other choose "profession."
The following definitions are from the online Oxford Dictionary.
Industry: Economic activity concerned with the processing of raw materials and manufacture of goods in factories.
Profession: A paid occupation especially one that involves prolonged training or qualification: A quality or accomplishment that makes someone suitable for a particular job or activity.
Which do you prefer? Death-care industry or Death-care profession?
Remains a Buried Mystery
By Terry McGuire, from the Seattle Times October 31, 1984 (from the archives of Paul Elvig)
The feeling could be described as eerie.
You stand in the quiet of the hillside graveyard, the bones of long-forgotten peioneers beneath your feet; suddenly, up from the valley where these early settlers lived and died, comes the roar of another jet engine going through tests at Boeing Field. It's enough noise, almost, to waken the dead.
The scene is an abandoned cemetery on Beacon Hill, just off 23rd Ave. S. and S. Graham St. Covered by trees and stickerbushes now, the graveyard has been closed and mostly neglected since the 1930s. still, there are those working now to see it restored.
Motorists winding up and down the steep Graham Street hill sometimes spot the graveyard when tombstones poke through the brush.
But only a foot journey through the overgrowth of branches and stickers and weeks and scotch broom can reveal the extent of this land of the dead. Persistent searchers will find more than a dozen granite markers and small monuments scattered here and there, a few with inscriptions still legible.
By some accounts, as many as 200 bodies may have been buried between 1880 and 1928, but without a map of the graves, no one knows for sure.
The remains of some were later moved, apparently including Maple School's namesake, Samuel Maple. Other cemetery names include Dr. Emma Rigby, one of the first women doctors in Seattle, and "Kendell Skene, Aged 1 yr. 2 mos. 13 days old," who drowned in the wash tub of his South Park home in 1904 after his mother had left the room for something. Forty-four years later in 1948, baby Skene's grave was the only plot in the cemetery still being cared for, according to a newspaper story.
Then as now, the cemetery was overgrown and vandals had toppled or stolen many of the tombstones.
Recently, a Green Lake-area woman reportedly found one of the stolen stones underneath her house. And last month, near the middle of the graveyard, police found an over-turned tombstone next to where someone had dug a funnel-shaped hole 6 � feet deep, for unknown reasons.
More of a mystery, perhaps, than the locations of the graves is the question of who owns the tax-exempt property. Valued at $336,000 this year by the King County Assessor's Office, the land continues to avoid cleanup efforts because no one knows whom to contact for permission, or for that matter, whom to sue should an injury occur there, such as falling into an open grave.
County plats identify the land as the Comet Lodge Cemetery, named after Comet Lodge No. 139, Independent Order of Odd Fellows (IOOF). In other accounts, the abandoned graveyard has been referred to as Georgetown Cemetery, IOOF Georgetown Cemetery, Graham Street Cemetery, South Beacon Hill Cemetery and Woodsmans [sic] of the World Cemetery.
But most reports have linked IOOF, a fraternal organization which still maintains its own cemeteries locally, with the operation of the Comet Lodge graveyard, although it apparently relinquished the title back in 1908.
Current King County tax rolls list IOOF's Glendale Lodge in West Seattle and its secretary, Andor Andrews, as the title representatives.
Contacted this week, Andrews explained that Comet Lodge was on the brink of falling apart in the late 1920s when it merged with Glendale. About the same time, according to what Andrews has heard, two brothers gave the cemetery land to Comet Lodge before moving to California.
Andrews said he can't verify the story.
Continue reading here
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Meet the Director:
Q & A with Jeff Privat, Batesville
Jeff is the new WCCFA Supplier board member.
How did you get into the death care profession, and when?
I was formerly in the banking industry for several years. A funeral home client of mine urged me to apply at Batesville, telling me I would be a "good fit." I was skeptical at first, but nearly two years later I love what I do and I truly believe I work for the best company in our industry.
What was your first position? What is it now?
My Batesville position is my first in this industry.
What keeps you in the profession?
In just a short two years, many of my customers have become good friends. That means everything to me.
Any particular experiences that stand out in your mind?
I am amazed every day with the service that funeral professionals provide. I've seen only a fraction of the grieving families that my customers see every day. It just makes me pause once in a while and realize it's not all about selling a casket or an urn.
I enjoy being a partner with my customers rather than just a salesperson. I get satisfaction when I bring an idea to the table that ends up being successful. My goal is to continue to be a partner with my firms and to help them be more successful.
How do you reach out to the community?
I spend a lot of time volunteering at school and sporting events for my kids.
What would you tell someone who was thinking about joining deathcare?
I would tell them it is a very humbling profession but I believe one of the most rewarding professions.
Jeff's family includes his wife: Jen (Jennifer) and children McKenzie (17), Mason (10), and twins Corbin and Kendyl (8).
Jeff's hobbies and personal interests: Our family loves to do anything outdoors. We also love to travel. I've been known to enter a poker tournament now and then.
Welcome aboard, Jeff!
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News from Quiring Monuments!
As cremation grows, churches accommodate
More now choose it than burial
Memorial gardens, columbaria offered
By Michaelle Bond, The Philadelphia Inquirer
PHILADELPHIA - Steve Morton read a few years ago that changing religious views, convenience and the economic recession were leading more people to choose cremation. As the senior pastor of Hopewell United Methodist Church in Downingtown, Pa., he knew he had to respond.
"The church has got to get in there with something sacred and beautiful," Morton said he and other church officials thought. "I have so many church members where Mom is in the basement, or Dad is in the garage."
So the church opened a memorial garden and two columbaria last year for the cremated remains of congregants and community members. And the church has a long-term plan to build up to four more columbaria, which contain niches to hold urns.
In 2007, about 35 percent of people who died in the United States were cremated, according to the Cremation Association of North America. By 2017, 49 percent of those who die will
|Leaders of Hopewell United Methodist Church examine the name on one of the new columbaria in the Hopewell Cemetery in Downingtown, Pa.|
As these numbers have increased, churches big and small have worked to offer attractive options for cremated remains. They are planting memorial gardens for scattering or burying what are known as cremains. They are designing permanent homes of different sizes and shapes for rows of urns.
Some churches have made these additions even if they do not have a cemetery for traditional burials.
Different teachings dictate what churches can do with cremains. For example, the Roman Catholic Archdiocese of Philadelphia issued revised guidelines to its parishes last year about cremation. It said remains cannot be scattered but must be buried in a cemetery or encased in a columbarium or mausoleum.
Only some Jewish leaders permit cremation. In the Philadelphia area, about 20 percent of Jewish families who use Dignity Memorial's Jewish funeral homes and cemeteries choose cremation, said Eric Wolverton, the Pennsylvania regional president of Dignity Memorial, a national network of more than 2,000 funeral, cremation, and cemetery service providers.
Churches pass out brochures highlighting beautiful landscaping and natural views they can offer at their cemeteries and gardens. Some gardens even attract members of the community to walk through or sit and read.
The brochures also emphasize that choosing gardens or columbaria is less expensive than burial. The median cost of a funeral in the United States was about $7000 in 2012, according to the National Funeral Directors Association. The average cost of an in-ground burial - including a stone, casket, excavation and burial lot - at Hopewell United Methodist Church is $16,000. A niche in one of the church's columbaria is $1,600. Scattering in the garden is $350.
Many people choose cremation so they can postpone funeral services until family members can travel to the location, said Jim Foreman, manager of Paoli Presbyterian Church's memorial garden.
A brick wall around the edge of the garden there acts as a columbarium.
About 150 people plan for their cremated remains to be buried in the church's memorial garden, created in 1991. About 100 more have reserved space within the brick wall around the edge of the garden. The Episcopal Church of the Redeemer in Bryn Mawr has three cremations for every one standard burial in its graveyard, said Jay Einspanier, the church's administrator.
Many people have bypassed the indoor columbarium the church has had for decades in favor of the memorial garden.
"It's just a nicer setting," Einspanier said.
When Hopewell United Methodist Church officials reserved 15 acres in 1960 for future expansion of the cemetery, members had no idea the expansion would be upward as well as outward, said Arnie Kring, chair of the "cemetery enhancement project."
Two granite and marble columbaria that each house 96 niches rise up on each side of a memorial garden and a labyrinth made of pavers where people can congregate. Including landscaping and driveway paving, the expansion cost nearly $130,000.
One of the columbarium niches belongs to Kim and Jim Schywstell, ages 54 and 56. They are the first in their families to choose cremation. They said they like the affordability and the elimination of the need for family members, who are spread throughout the country, to tend graves.
"This is a gift for our children," Kim Schywstell said.
Debra Boyd, 61, recently traded in her burial plot at Hopewell for a niche in one of its columbaria.
"The joke here is that I have the penthouse," she said. "The top corner facing the east. It's a beautiful view from that corner."
Sourced from the Seattle Times in its entirety with permission
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To Whom It May Concern,
Hello, I am contacting you on behalf of the U.S. Department of Veterans Affairs (VA), National Cemetery Administration (NCA). NCA recently acquired the ability to send electronic updates regarding important memorial benefits for Veterans through GovDelivery, an electronic e-mail distribution system.
Either you self-selected to receive updates from NCA, or you were chosen to receive this e-mail based on your position, and the potential for you to obtain memorial benefits and coordinate the inurnment or burial of deceased Veterans. We hope you will be able to help us honor our Nation's Veterans by using the information in these updates to ensure deceased Veterans are treated with the utmost dignity, respect and compassion, and obtain the benefits they earned through service to our Nation.
There are a wide variety of VA memorial benefits available for Veterans, their loved ones and those taking care of their final arrangements. It is our goal to ensure you and your customers are aware of these benefits and understand how to obtain them in the future. Whether it is determining a Veteran's eligibility for burial in a VA national cemetery, scheduling of a burial or inurnment in a VA national cemetery, or ordering a grave marker for use in a private cemetery, we are here to help.
Please look for our future e-mails on memorial benefits available for Veterans. Also, please encourage your colleagues to sign-up for future e-mail updates and information regarding VA memorial benefits through GovDelivery at https://public.govdelivery.com/accounts/usvanca/subscriber/new.
Chief, Communications & Outreach Support Division
National Cemetery Administration
U.S. Department of Veterans Affairs
Hepatitis C vaccine shows promise,
Editor: This could have very positive ramifications for embalmers and other who come into contact with bodies containing the virus
Preliminary trials: Some side effects; trial will be expanded to more test subjects
LOS ANGELES - An experimental vaccine for hepatitis C has shown promise in preliminary human-safety trials, according to researchers, and may pave the way to a more affordable means of fighting the virus.
In a paper published Wednesday in the journal Science Translational Medicine, authors wrote that 15 people in Britain were given a "prime and boost" course of the experimental vaccine.
Researchers said the shots stimulated a protective response from the body's T cells - white blood cells that are critical to battling pathogens.
Although the vaccine caused headaches, feverishness and fatigue in some objects, researchers said those adverse effects disappeared within two days.
Overall, they said the vaccine was proved to be "safe and well tolerated."
A larger Phase II trial will now be performed on more than 350 test subjects at the Un iversity of California, San Francisco, and Johns Hopkins Bloomberg School of Public Health, according to the National Institutes of Health.
"We won't really know if it works - if it is able to prevent hepatitis C infection - until we have the results of the efficacy studies in the USA," said Eleanor Barnes, an immunology professor at Oxford University and the paper's senior author.
Hepatitis C is believed to affect 180 million people worldwide, and is spread through contact with infected blood. It often is associated with intravenous drug use and can lurk in the body for years before it is detected. It is a leading cause of liver cirrhosis and can lead to liver failure and liver cancer.
New therapies for patients infected with the virus have proved effective, but they are extremely costly - a 12-week course of medication can cost up to $84,000.
The Phase I safety trial was conducted by researchers at Oxford, Stanford University and the Italian biotechnology company Okairos, which is part of GlaxoSmithKline.
Researchers pointed out that 1 in 4 people who suffers a first-time infection of the virus will clear it from his or her body naturally. This strongly suggests the immune system can fight off the virus with help from a vaccine.
In this case, the experimental vaccine includes an initial "prime" shot of a weakened chimpanzee cold virus that has been genetically modified to carry four proteins associated with hepatitis C. A second "boost" shot, to be given eight weeks later, contains a modified vaccine Ankara (MVA) virus with the same four proteins.
By injecting these viral proteins into the body, researchers hope T cells will recognize them as potential future threats and marshal an immune-cell attack on the virus.
sourced with permission from the Seattle Times for 11/6/14
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Documenting the service
of Seattle's youngest hero
"Saipan Marine, 15, to Be Buried Here." Did I read that right? Fifteen!? I held in my hands a 1948 news story published along with an obituary announcing the burial of Marie Pfc. William Westlake some four years and eight days after he was killed in action in Saipan during World War II. (Delayed burials were not uncommon following the war.)
We were scanning old news items, this one published in the Seattle Times, about a young man who convinced a Marine officer that he was 18 rather than 15 and who, less than a year later, was with the Marines as they landed on the beaches of Saipan. Three thousand four hundred and twenty-six Americans were killed; Westlake was one of them. He was wounded and
|Standing at Pfc. Westlake's grave facing east, one has a sweeping view of Washelli's veterans section, with its memorial tower located on high ground. For years, this was the only "veterans cemetery" in the Seattle area and is still the center of Memorial Day special programs.|
died almost immediately.
How could this have happened? Didn't the services check ID, or confirm with parents, or seek some proof of age when people were enlisting in 1944? I found myself a new mission: I must find out how he managed to enlist, and I must locate his grave.
Working with the University of Washington's historical records unit, Evergreen-Washelli's goal is to save through scanning all documents and obituaries related to those buried or cremated at EW. The idea is to make this treasure trove available through the university to future generations wishing to do historical research.
Researching old newspaper articles and what limited public records are available, one learns from Westlake's burial story that as a lad of 13, he helped out each day at noon during Seattle's WWII Victory Square programs.
He had been scolded by a police officer - in addition to the operator of the public address system - for scribbling his name on the square's pylon. Pointing to the pylon with the names of the war dead inscribed on it, he told his scolders that "maybe someday my name will really be up there." How sadly prophetic!
After looking up the interment record signed by Westlake's mother, Mrs. B.M. Atwell, we (a cemetery crew member and I) located the grave with ease. Atop a grassy knoll and in view of nearby Highway 99, we stood in respect and read aloud Westlake's memorial. The crew member was surprised when he did the math: "Really, was he only 15?"
Yes, really! How could that be? Could such a thing happen today? Why would a young teenager, or for that matter, anyone want to go to war so badly he would lie in order to enlist? Would a kid today be willing to forge records claiming he was 18 so that he could go to war? Have outlooks and desires changed? One wonders if, following 9-11, kids that are too young to be in the military have tried enlisting.
Checking further, we learned that in 1949, Evergreen-Washelli's 15-year-old veteran's name was removed, along with all names appearing on Seattle's Victory Square pylon. The monument was demolished. Times had changed.
Pfc. William Westlake's name, along with the rest of the names on the original pylon, now appear on Washington State's Ware Dead permanent memorial at Benaroya Hall in downtown Seattle, and also can be found on their website.
More Internet research uncovered a group called Veterans of Underage Military Service. See the sidebar to learn more about them.
Article by Paul Elvig sourced with permission from the ICCFA Magazine March/April 2014.
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Then about eight years ago, an inquiry on the property sent Andrews to the county-city building to get a title description. He believes whatever request papers he signed then made him and the lodge title representatives. "There was a place to sign your name. That didn't mean I owned it or anything," Andrews said, although he added his belief that Glendale Lodge probably acquired the property from its consolidation with Comet Lodge.
Another interested party in finding the legal owners is Carolyn Farnum, vice-president of the Seattle Genealogy Society. She ordered a preliminary title search recently which traced ownerships back to 1895, when a woman named Diana Borst Collins Woodbridge Sour, possible the widow of pioneer Luther Collins, deeded the cemetery to Comet Lodge.
Farnum speculated that the Beacon Hill site, like other pioneer cemeteries, may have been a converted Indian burial ground.
Her records show the earliest burial there was of Samuel Maple in 1880, and the last, ironically, was another Maple: Elizabeth Jane (Maple) Van Asselt, in 1928. Altogether, Farnum has the names of about 80 people buried there and believes the total would pass 100.
Farnum's title search shows that Comet Lodge sold the cemetery in 1908 for $1 to Georgetown undertaker H.F. Noice, who deeded it four years later to former Soldiers' Home physician Dr. Hiram Corson. The search ends there.
"According to the title search, he still owns it or it still belongs to his estate; that's where the problem is," Farnum said.
She believes the property would've been passed on to Corson's son, Willis, but for the fact that the son died in 1943, two years before his father did. Willie's widow - apparently in response to inquiries and a short-lived newspaper crusade to clean up the cemetery - did her own title search in 1951 and found that neither she nor her son were owners, Farnum said.
If finances allow, the next step in determining ownership will be to look for it in Dr. Hiram Corson's probate records, said Farnum, who added that she hadn't heard of the story about the two brothers donating the graveyard to the Comet Lodge.
Like Andrews of the Glendale Lodge and other groups before, Farnum would like to see the cemetery restored.
"We'd like to form a cemetery association along with the Daughters of the Pioneers or survivors (of the deceased) and other history groups and maybe have a nice big marker marking it as a historical site, instead of an eyesore," she said.
Andrews and officials with the Odd Fellows state headquarters say they've also discussed cleaning up the graveyard, regardless of ownership, because its present condition reflected badly on the Odd Fellows reputation.
"We think it'd really be a nice small park," Andrews said.
According to state law, the remains in the graveyard could be removed by superior court order if required consent by survivors cannot be obtained. Along with title clearance, it could be the road a developer might take to make other use of the $336,000 property. But any proposal to "make a buck" over a graveyard would face a tangle of financial, legal and social hurdles, promised Paul Elvig, administrative assistant for the state cemetery board.
"We as regulators would resist the thought," he said.
But it has been done, said Farnum, who recalled that a Bellevue clinic was built over a pioneer graveyard, although the venture ended up costing the sponsors much more money than they had bargained for once the families sought disinterment. Unlike Comet Lodge, the Bellevue site escaped one legal hurdle because it was an unplatted cemetery.
Elvig added that a state law requiring endowment care funds for present cemeteries prevents them from becoming the abandoned cemeteries of tomorrow.
Persons who believe they have ancestors in the Comet Lodge Cemetery are asked to contact Farnum at 682-1410.
Another chapter in the saga of the Comet Lodge Cemetery will appear in a future issue of this newsletter.
Legacy funeral businesses have many options for responding to the low-priced competition. Some are relatively easy, while others require fundamental changes in the business owners' philosophies and operating policies.
The first step for many owners is to realize that families set a budget for funerals just as they do for automobiles, homes and weddings. Regardless of whether the family selects a traditional funeral home or a firm that advertises lower prices, the sale will very likely to be about the same.
The point is, just because a funeral home advertises low price does not necessarily mean every arrangement is made at the advertised price - in fact, it is safer to assume just the opposite. Once their budget is set, the family may spend more, but it is unlikely they will spend less.
For many firms, the first step in competition is to overcome the rumor initiated and perpetuated by low-price competitors that the traditional firm's prices are very high and the discounter will save families thousands of dollars. The reality is, the difference in price is relatively small.
Therefore, job one is to dispel the rumor, which is relatively easily accomplished with advertising that posts a starting price for funeral services. The price for a one-hour visitation preceding the funeral, a 20-gauge casket and a grave liner represents an entry-level traditional funeral, and is typically priced lower than most families anticipate.
The next response level is to accept that most if not all of the savings delivered by lower-priced funeral homes come from the selection room, not the arrangement room. Every funeral home should offer some high-eye-appeal, lower-priced caskets in addition to the higher-end caskets in their merchandise selection rooms.
These caskets typically come from suppliers other than the big three simply because high-eye-appeal, low-priced caskets do not fit well in their pricing structure. If a 20- or 18-gauge casket is too attractive, it will necessarily undermine the sale of heavier-gauge caskets, which is why the lower-priced caskets from the major suppliers tend to be less attractive.
Have some lower-priced but attractive units available when necessary to match the prices being offered by a lower-priced competitor.
Use the Internet: A website is no more than a brochure that offers valuable interactive functions. Many websites based on standard templates fail to higholight an individual firm's competitive advantages, such as community rooms, or even cemeteries that offer maudoleums, niches and graves.
In addition, the Internet offers you a way to compete with low-price firms by offering an online price estimator (so that families can see what your services actually cost) as well as online cremation arrangement.
Every funeral arranger needs training and sales aids, such as arrangement room posters, to improve their performance. But even with training and sales tools, some funeral directors are going to be better at it than others.
Large-volume firms are beginning to appreciate the advantage of identifying their best arrangers based on their measured performance. Management needs to use the capabilities of funeral home software packages that record each arranger's casket sales, funeral sales and cremation sales.
Few funeral directors receive constructive communications skills training, which is why firms lose so many price shoppers, and why so many cremations are direct disposition.
One of the benefits of training is that the firm develops a culture or generally accepted practice about how things are accomplished, including:
- Presenting reception services
- Making cremation arrangements
- Generating preneed appointments from at-need families
Developing creative ways to compete on price
Every business with a high cost of entry, including restaurants, hotels and airlines, has a means of liquidating excess capacity.
- Restaurants offer early-bird specials to fill talbes during early evening hours
- Hotels liquidate vacant rooms through Hotels.com and Expedia.
- Airlines offer lower fares to casual travelers who book in advance than to business travelers who purchase tickets as the need arises.
Part of winning the price-shopper battle involves finding ways to bring down cost while maintaining profitability. One way to accomplish this is to offer a non-advertised special price package that offers a significant savings but places restrictions on the family, such as weekday, early morning or late afternoon services and use of smaller, less desirable chapels.
A challenge common to all funeral homes is that the last firm a family collects funeral prices from can undercut competitors with a price quote below what's printed on its own price list.
This is a very difficult challenge to overcome - the only possible way is to keep a family who's visiting your firm from visiting other funeral homes. One way of accomplishing this is to make competitors' price lists available to families while they are in your funeral home.
The family will compare competitors' published prices against yours and you can make adjustments as required, thus precluding the competition's opportunity to offer a lower price.
Funeral directors always regret that they didn't anticipate the scope of a low-cost threat and respond forcefully. It's never too late to compete, but it's much more difficult to eliminate the challenge after the competitor has become strong.
To be sure, a failure to foresee new competitors is an example of the forces of "creative destruction" at work in capitalism. But companies alert enough to identify the nature and magnitude of the challenge will be in a better position to find ways to hold the new competitors at bay.
Article by Glenn H. Gould sourced with permission from the ICCFA Magazine for March/April 2014
The author is CEO of MKJ Marketing, Largo, Florida, which helps funeral homes and industry vendors establish marketing and advertising plans and conduct market research. www.mkjmarketing.com
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The WCCFA Insider is published ten times per year by and for the members of the Washington Cemetery, Cremation & Funeral Association. Portions of the information in this publication are taken from other sources which we believe to be reliable and which are not necessarily complete statements of all the available data. The services of an attorney or an accountant should be sought in connection with any legal or tax matter covered. Conclusions are based solely upon our best judgment and analysis of technical and industry information sources.
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