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Funeral homes adjust to virtual demand

75% of consumers want online pricing

Posted 6/14/20

The COVID-19 pandemic has changed how industries address public safety and health as people continue to engage face-to-face or virtually.

The funeral and cemetery business is no different, as a …

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Funeral homes adjust to virtual demand

75% of consumers want online pricing


The COVID-19 pandemic has changed how industries address public safety and health as people continue to engage face-to-face or virtually.

The funeral and cemetery business is no different, as a study shows the pandemic has significantly changed consumer attitudes and behaviors in three key areas of the industry — the buying and shopping process, the necessity of physical presence to support loved ones in their time of need, and the influence of technology on both.

According to The Foresight Companies 2020 Funeral and Cemetery Consumer Behavior Study, 75% of consumers want pricing online — a practice virtually unheard of in the funeral home industry — and many consumers will not do business with providers who do not deliver transparency.

“The resulting business implications the study points to are colossal — especially for a sector largely unchanged for decades,” stated Chris Cruger, Partner and Chief Operating Officer at The Foresight Companies. “How owners staff their business, how they use their physical space, their investment in technology — these core operations have shifted in the last 60 days. We’re not implying that the funeral business will now be entirely virtual; however, the study clearly indicates that the pandemic has forever changed how consumers plan for, buy, and participate in funerals. And those businesses that adapt quickly will win the day.”

With social distancing becoming part of the new normal, in-person services shut down for some industries from March through mid-May. For some, attending funerals meant drive-thru services as groups of over 10 were not allowed — leaving large families unable to grief their loss together.

However, the use of technology has increased acceptance of livestreaming funerals as a regular practice. The study found 43% of consumers believe that attending a funeral via livestream “demonstrates how much I care,” a 72% increase compared to pre-pandemic levels.

“We’re experiencing a sea of change in consumer behaviors with long-term implications for technology and physical infrastructure as well as the deployment of human resources for the funeral and cemetery professions,” Mr. Cruger told the Daily Independent. “Webcasts and online pricing have gone from nice-to-haves to minimum expectations overnight. You can’t put that genie back in the bottle.”

In addition, 40% of consumers expect livestreaming of services will be available permanently. However, only 21% are willing to pay for it. Oddly enough, 26% feel strongly that it is important to attend a funeral in person — down from 42%.

But don’t expect to see way less people at the next funeral you attend.

“While the virtual options are becoming much more popular, the funeral industry is a long way from removing the highly personal nature of interacting with families at one of their most difficult times,” Mr. Cruger said. “Even as some interaction is gaining some virtual momentum, the study shows that there is still strong interest in that one-on-one interaction.”

Analysts have widely speculated about behaviors changing in the death care services business. A $20 billion industry, more than 2.4 million funerals take place in the U.S. annually and employs more than 100,000 Americans serving families in their time of need, according to The Foresight Companies. These shifts in consumer attitudes and behaviors are taking place across demographic and religious spectrums.

The study was designed to understand consumer attitudes, perceptions, and behaviors about the funeral and cemetery industry during three separate periods: prior to, during, and after the pandemic has passed. The study is based to 2,548 respondents drawn from a nationally representative panel sample of U.S. residents. Mike Cooperman, a spokesman for The Foresight Companies, said 57 respondents came from Arizona, closely aligning with national representation for the state, which is just over 2% of the nation’s population.

According to the study, 46% of consumers say they will handle funeral arrangements virtually, an activity that has historically only occurred in-person with a funeral director. Also, 52% say they will only do business with companies that provide online pricing options. And 73% say it’s important to have pre-planned funeral arrangements, up from 58%.

As the funeral home industry shifts some services online, Arizona Attorney General Mark Brnovich recently joined a coalition of attorneys general calling on the Federal Trade Commission to enhance consumer protections around those services. The Funeral Rule, enacted in 1982, protects consumers from unfair and deceptive practices in the sale of funeral products and services.

Funeral expenses have risen almost twice as fast as consumer prices, according to the U.S. Bureau of Labor Statistics.

“Most of us don’t have experience in planning a funeral, but losing someone we love can be one of the most difficult times in a person’s life, and it shouldn’t be made any harder by incomplete information or inconsistent pricing,” Mr. Brnovich stated. “I urge the FTC to adopt new rules to further protect grieving consumers against fraudulent or overbearing demands made by the funeral industry and increase transparency for people who are in need of funeral goods and services.”

In a letter sent to the FTC about its proposed Funeral Industry Practices Rule, 23 attorneys general warn that insufficient pricing transparency in the industry prevents consumers from accurate comparison shopping and exposes them to being overcharged. The coalition is urging the FTC to require funeral service providers to standardize pricing disclosures and safeguard against the misuse of funds consumers pay in advance of a funeral.

As deaths from COVID-19 rise and many funeral arrangements cannot be conducted in person, Mr. Brnovich and the other attorneys general are asking the FTC to better shield bereaved families nationwide from unknowingly overpaying for funeral services.

“I can tell you that the consumer is making it clear that they are going to demand it,” Mr. Cruger said about the rising demand for online funeral services. “So whether is a government mandate or market driven decision, it’s coming. The demand for online pricing simply isn’t going away.”

The FTC is reviewing the relevance and effectiveness of the 1982 ruling, which regulates funeral homes. The current iteration requires providers to give up-front itemized price information along with explanations for those prices, though there is no standardized format providers must follow to offer easy price comparisons for consumers. The current rule also allows consumers to use caskets purchased elsewhere at no added expense, gives consumers the right to opt-out of goods and services they do not want or need, and offers some protections from misrepresentations around services such as embalming.

However, the rule has not been updated since 1994, and it does not require providers to post this information online or offer consumers context around average funeral costs. It also leaves consumers vulnerable to overpayment or fraud if they pay for services in advance, such as through a life insurance policy.

“World-class businesses are constantly listening to the consumer and adjusting how they operate,” Mr. Cruger said. “Funeral homes are constantly adjusting to technology, service and improving their offerings based on the feedback they receive from their client families.

“Regardless of what has happened in the past, our study tells us that in the future, online pricing is a must have. And that means, even though the pricing might be complex, as it tends to be, funeral directors and cemeterians need to find ways to make the information more consumable.”