Businesses commission research studies when there are unexplained difficulties with the business; primarily “business is down and we don’t know why”.  Over four decades funeral businesses commissioned hundreds of studies to explain the causes of declining business.  During the 1980’s and 90’s many funeral businesses in New York city metro area experienced declining volume as retirees began leaving the city following retirement. The migration wasn’t immediately obvious, which caused operators to begin questioning their business. Over time, many funeral businesses closed or sold for property value; they transferred pre-needs, family files, phone numbers and business names to larger, remaining firms.

Facilities, pricing and staff members also caused declining at-need volume. However, the most common cause of decline was insufficient advertising. Research respondents indicated “reputation”, “not familiar with the firm”, or “know nothing about this business” as reasons not to select a funeral home.  In other words, insufficient communication with the public.

Today’s article for Funeral Director Daily is authored by Glenn Gould.  For 35 years, Glenn Gould was CEO of MKJ Marketing, a death care industry marketing firm serving funeral homes, cemeteries and death care industry vendors in areas of Digital Marketing, Market Research, Advertising and Training Programs.  MKJ was founded in 1982 and had over 3000 funeral home clients throughout the US and Canada. In 2021 MKJ was acquired by Tribute Technology, a Carlyle technology roll-up; Glenn has continued with TT as a marketing consultant.

There were reported 22,000 funeral homes in the 1960’s and 70’s: most conducting fewer than 150 cases annually. Most firms served a specific neighborhood, church, religious or ethnic group. As such advertising other than sponsorships, church bulletin and public relations all that was necessary to maintain an on-going business.

Glenn Gould

As cremation became more popular through the 1980’s and 90’s, funeral businesses needed to serve larger geographic and demographic areas which was accomplished with elevated advertising and marketing. Those that refused to accept the new reality experienced declining business.

Advertising during that period was primarily in print, IE: newspaper, yellow pages, direct mail. Radio advertising never had much impact save “obituaries on the air” advertising in rural areas. Firms first to adapt to television advertising experienced accelerated growth, taking business from firms that failed to communicate. The cost of cable and broadcast advertising grew advertising budgets, but the results were impossible to measure, which made advertising a “leap of faith”.

The greatest competitive advantage of digital advertising is the ability to measure results. Results from pay-per clip (PPC), social media advertising, over-the-top television and geo-fencing enable the client to identify productive advertising. This has caused advertising budgets to grow even while marketing costs have declined as unproductive advertising is discontinued.

Digital advertising has eliminated the need for market research as consumers effectively communicate what they like and dislike about various competitive firms by the selections they make. Competitors can view each-others’ ads to identify more successful messages.  So why do so few funeral homes effectively use digital marketing? Even more to the point, why do they continue investing in print advertising? After all, the fact that the daily newspaper is down to once or twice weekly indicates declining readership.

The combination of cremation and digital marketing also challenge the logic of branch facilities in the same market. The threat of being a primarily cremation business with too much overhead should cause owners to question the logic of acquisitions that add addresses but fail to create sufficient profits. Just as in the 1980’s through 2000’s, cremation is causing funeral facilities to sell for property values while selling pre-needs and family files to larger firms.

Many of the expenses borne by funeral businesses in the past are now superfluous which has created opportunities for investors to open mortuary service businesses.  Providing first call, embalming, cremation, drivers and vehicles on an as needed basis reduces over-head costs while making more productive use of the declining number of licensed directors and embalmers.

Again, just as in the past, firms that fail to adapt to the changing environment will suffer losses, causing more firms to sell for property value and the continued growth of larger firms.

More about Glenn Gould:

As CEO of MKJ Marketing, Glenn assisted funeral homes and death care industry vendors in establishing marketing and advertising plans.  He is recognized for his market research services having conducted over 800 positioning and prospective trade area studies throughout the US and Canada.  In addition to quantitative research studies for funeral homes and cemeteries, Glenn moderated one-on-one interviews, focus groups and test panels.

In addition to MKJ Marketing, Glenn held executive positions with Bausch & Lomb, General Mills and the Batesville Casket Division of Hillenbrand Industries.  He is a recognized speaker at industry conferences, seminars and conventions.  His articles appear regularly in funeral service publications. His two books  “Deathcare Marketing, 25 FAQ’s” and “Funeral Home Marketing-Moving The Bottom Line” have sold thousands of copies and are in use at mortuary colleges nationally.

Glenn has testified as an expert witness in multiple civil suits between funeral homes, served on the Board of Directors of the Pittsburgh Institute of Mortuary Science and instructed the Small Business Class for the St. Petersburg College, School of Mortuary Sciences.  Glenn holds B.A. and M.S. degrees.

Tom Anderson
Funeral Director Daily

Funeral Director Daily take:  On Monday Funeral Director Daily published an article that had to do with the number of funeral homes in the United States and the “Average Revenue per Firm”.  That data confirmed that there were 15,703 funeral homes in the United States in 2022 — down from author Gould’s estimate of 22,000 back in the 1960’s.

That’s a 30% decrease over those years and some of the decrease would have to be associated with the lack of evolving into a funeral facility that profitably handled the increase in cremation disposition cases over the years.

It’s easy to see that funeral service is continuing to evolve and I believe that we will see another 30% reduction in the number of traditional facilities that operate Death Care services over the next 20-30 years.  As Glenn Gould makes the point, make sure your funeral home evolves with the changing consumer habits so that you’re not one of those reductions.

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“A servant’s attitude guided by Christ leads to a significant life”

When I look at the long-term trends of democratic countries — countries that I define by having free and fair elections for leaders — I see historical movement towards more “socially economic” values.  For instance, when I look at European countries that were founded much earlier than the United States I sense a pattern of less self-reliance among individuals and more social equality of government than one might see in the United States.

I’m not taking a pro or con viewpoint of that — it just seems like reality to me.  I traveled first to Europe in 1991 and it was on that trip that I noticed some of the differences between the countries I traveled in and the United States.  Once of the things that stood out to me was a sense of self-reliance being chipped away at over the years and replaced by a sense of a greater societal care in these countries with longer histories than the United States.

I think that is easy to see when you look at health care or higher education.  While there are good things and probably not so good things about social health care, the reality is that democracies that have been a round a long time seem to operate with that type of health care system.  The United States, which will turn 250 years old next year, still operates its health care system in a quasi-free market system.  And, I think, not necessarily for the better, some day that will change.

I have this vision of societies as they change.  The vision is that of a rock — in America’s case maybe it is Plymouth Rock.  As the years go by that rock gets pieces of its original values “chipped off” by government legislation.  And, when those pieces get “chipped off” they can never be put back in place again. . . . Again, for good or bad, the rock, or country, is never again the same as when it began.

As America moves forward I can envision some of our voters determining that Death Care expenses should not be a part of self-reliance of citizens but a social benefit of living in this democracy.  There is, by some, a foundational value that encourages costs to be shared by all.

While we have a $255 death benefit throught Social Security (you can read about that history here), just last September Senate File 5178 was introduced into the United States Senate.  That bill, which appears to be either held up in committee at this time, suspended because of the new congress, or simply forgotten because it was an election year ploy, was co-sponsored by two of America’s best known social-leaning senators — Sen. Elizabeth Warren of Massachusetts and Sen. Bernie Sanders of Vermont.

That bill would amend the Social Security Act to include a $2,900 death benefit, increased annually by the Consumer Price Index, from the current $255.  You can learn more about the bill here.

Tom Anderson
Funeral Director Daily

Funeral Director Daily take:  I think that the idea of this bill shows a little about what is wrong with American government.  Everybody wants a benefit, especially when society pays for it. . . .and for politicians, giving benefits can get votes. . . . (Check the timing on the aforementioned bill, S. 5178 — it was introduced and received publicity just six weeks prior to the 2024 Presidential election).

One problem with this type of solution, in addition to the possible reasons for the timing of the introduction, in America is that the amount suggested, $2900, then becomes a subtle suggestion to a financial number that many may believe is the price they should pay for services.  With the current $255 benefit, the number is small enough that nobody believes that they can get services for that price.

I hope it doesn’t happen but I can see, and this introduced bill indicates, that there seems to be solutions in search of problems in Washington, DC.  However, I see the eventual passage of items like this as our country grows older and many of our residents believe in “Social economics” rather than “self-reliance” for their economic well-being.

Maybe I’m wrong, but market pricing and market solutions are a far better world for the Death Care profession to live in than one that is operated with government subsidies, payments, and increasing government regulations.

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“A servant’s attitude guided by Christ leads to a significant life”