So, it’s not my hunt…not even my dog; but I just hate being played.
A few weeks ago I was working with a client in the Midwest:
50 to 60 calls
30 – 35 caskets sold a year
He was so proud of himself. He had just negotiated a 25% discount from one of the big 3 but not Batesville.
Besides being annoyed that he had no idea how the 25% related to full price I had to leave the room just to bang my head against the wall. Sometimes external pain can temporarily relieve angst.
Isn’t anybody else wondering…or is it just me…if a guy who sells 30 – 35 caskets a year is getting a 25% discount and everyone else (large and small) is getting a 25% discount who the heck is paying full wholesale?
or
is the net price after the 25% discount really the new full wholesale?
Some years ago there was a nationwide nursing shortage. Then some very wise doctor’s and hospitals realized that there really wasn’t a shortage…there was a problem. Too many nursing duties were non – nursing tasks. Things like paperwork, bathing patients, cleaning rooms etc. Doctors and hospitals were using nurses as glorified clericals. Even with this awareness things didn’t change much. Except in a few medical institutions.
What did they find? When they augmented their nursing staff with support staff to do non nursing activities patient care improved; they only needed 1/3 as many nurses; they were able to cut costs; increase pay and improve the work environment for the remaining nurses. Patients were happier, nurses were happier and so were administrators.
The average case load in America for Licensed Funeral Directors is somewhere in and around 85. Why can’t it be 125? What are your funeral directors doing that are really non funeral director duties?
If I were you I would want a Radar O’Reilly on my support team. Radar, as some of you will remember, was the colonel’s assistant in the long – running tv show MASH. What qualities did he have that we should want?
Commitment and focus on support. Working ahead of the breaking wave, being proactive and ANTICIPATING needs before they were needed
Exceptional task and time management
Disciplined focus
Continued awareness of time and task and especially vision (Why am I here?)
Distinguish between the ‘important but not urgent” and the “urgent but not important”
Keen Intuition. The ability to read the Colonel’s mind as well as others and respond in the moment
Strong listening skills. Able to listen with an open mind
Organized
Strong interpersonal skills and relationship management. Ability to get things done through and with people
Technologically capable. Know how to optimize technology for efficiency
Sense of humor
High energy
Confident enough to work independently
Able to execute projects and communicate with others effectively
High in emotional intelligence and self management
Resourceful problem solvers
Efficient multi tasker
Thrives on change but honors the need for stability and completion
Many consider the advent of the Internet to have ushered in the “Age Of The Consumer.” The balance of power (inherently favoring the holder of information) has clearly shifted in a way that at least provides parity between vendor and customer. In the case of those unfortunate products and services which are considered commodities, the balance has shifted beyond parity to the consumer. DeathCare, with its preference for the conventional, is quickly moving toward becoming a commodity.
Seeing this trend, many in DeathCare are becoming convinced that the best strategy is to focus on price. Worse, since many practitioners can’t seem to give up their prideful need to provide higher levels of service, some are chasing the dual and suicidal strategy of price AND service. But what if treating families as the typical proactive, in control and well informed consumer could backfire… on them as well as you?
Most practitioners are really order takers. They ask families what they want and often simply deliver it to them. Even when they know it won’t meet their needs. A few brave souls in recent years have actually learned how they can differentiate themselves by bringing more VALUE by being more assertive in the arrangement conference. In other words, by being true professionals and taking a risk (which, it turns out, is minimal) by guiding families based on the provider’s expertise.
Taking orders and refusing to challenge families is wrong on at least two levels: 1) You are assuming they really have researched what they need emotionally and what they can afford economically. 2) You fail to offer a professional perspective relative to their needs and provide options they might consider.
I have come to believe that the single greatest fallacy practitioners maintain in their thinking is the belief that families actually like them and they have more to lose by challenging them than they have to gain.
I think the following three points are closer to the truth:
1) Families don’t want to be there: They are there because they have to be there. They have a dead body and are experiencing a variety of emotions. They want the issues (all of them) resolved and their lives returned to normal.
2) Families are not equipped to be there: How many times do people make funeral arrangements in their lifetime? Even though much information can be gleaned from the internet it is mostly technical in nature and they don’t have the tools nor do they have the specialized expertise to properly absorb the information our system asks them to absorb.
3) There are usually multiple persons involved: We forget that the process is complex and that most people in this setting are not independent decision makers. Automatically that means there are multiple perspectives to address, coalesce and focus. That takes a skill for which most practitioners have no training. Hence, it is safer to say nothing.
The solution is to avoid treating families as consumers. Think, instead, of how we can provide easy and simple tools with which they can understand and then act on the real needs they have. For example: The Mayo Clinic faced a similar challenge in its treatment of diabetes patients. It created a set of “Decision Cards” that reduced technical information to easy – to – understand graphics and very plain language so that patients could be informed about the risks, side effects and other items pertinent to their choice of treatment.
We effectively “Burden” the family with their final decision (regrets and all). Instead, families and practitioners should work together to find the right service for them. We need a mechanism for discussion around trade -offs to find the best course for everyone. Services need to be practical as well as affordable.
When we choose to assume a passive role we are treating our customers as consumers and making assumptions that we know are not generally true with today’s families. When we choose to become a professional expert we take an active role guiding people through the choices and trade – offs necessary to provide a meaningful and affordable tribute…even if it doesn’t include a casket.
I subscribe to the Harvard Business Review Blog and an interesting article came through today that I wonder might have application to those of you who might be challenged by low price competitors.
It is a way to separate those who are truly price shoppers and those who are looking for value. It also might be a way to beat your competitors without compromising your own market position.
It turns out that truly price sensitive people will tolerate more uncertainty than those who are looking for value. Think Priceline. They only tell you the area you are bidding on and the star rating you choose. You bid and only when your bid is accepted do you know what hotel you get and exactly where it is. This approach allows hotels to sell unused rooms at a deep discount without compromising their relationship with those who are willing to pay full price.
So, let’s say you have a competitor that advertises direct cremation at $795. Your real goal should not be to capture the bottom of the market but to make it very difficult to for them to stay in business. So you beat his price at $495 but the customer doesn’t know when the body will be picked up or who will handle it. Your competitor freaks out and lowers his price to $395 and accelerates his starvation. IF you get a call you go when you have time, you put the body in the cooler and cremate when you aren’t doing anything else and send them a postcard to pick up the remains in a plastic bag. YOU DO NOT PUT YOUR BRAND ON IT. At the end of the day you don’t care if you get any calls you just hope he closes shop quickly.
While I was in college I spent a summer as a Merchant Seaman on a Great Lakes iron ore carrier. Some of the crew “took me under their wing” and while in port one time invited me to join them on a trip into town.
On the way one of them turned to me and said: “Alan, you have probably never been in a place like this before so here is some advice, If something happens just grab a bar stool and hit the biggest guy you can find and then run like hell.”
It was one of those watershed moments. My brain locked in on the words “if something happens” and my imagination went into overdrive. The day itself proved uneventful although the experience was both bizarre and pathetic.
I have never forgotten that advice. So, as I frequently encounter 10 – call tyrants in my work with funeral homes it comes to mind often.
a 10 – call tyrant is that guy who undermines everything, has an attitude and takes every opportunity to show you disrespect. But since you think he will take 10 calls with him if he leaves you leave him alone while your better staff lose respect for you and your firm and he effectively blocks any effort you make toward progress.
Whether he or she will take 10 calls is not the point. If you were to quantify the damage they do to your firm in morale and financially you could easily afford to lose them. Add to that the emotional toll it takes that is often so severe that the owner hates going into the business.
Most of these guys are too old and embittered to start over.
If they go to work for your competitor they will only perpetrate their misery there and it may well help your firm
They don’t behave the way they do with only you but with everyone so the public generally has their number and the calls they take will also be those sad souls who like to pool their misery together.
Proverbs 22:10 says:
“Cast out the scorner and strife shall cease”
I have given this advice over the years and two of my clients acted on it. I think they would tell you that it was the best thing they ever did. So, pick up your barstool and take him out. Because:
“If you fail to walk in your god – given authority some one will take it away from you and use it against you!”
“You Can’t Manage Change…You Can Only Get Ahead Of It.”
Peter Drucker
Joe Weigel
Last year, for the first time in the history of the annual Best Global Brands report, it was reported that Coca-Cola was no longer the most valuable brand in the universe.Interbrand, a leading brand consulting agency, stated there was a new #1 brand: Apple. Following Apple on the list was Google with Coke finishing in the third position.
This year, for the first time in the history of North America, cremation is expected to overtake burial as the preferred means of disposition. What happened and how can we learn from Coke’s strategic “misdirection”?
Apple’s meteoric rise in value is due in part to the way it has continually reinvented itself. It has designed a seamless, multi-channel experience for consumers and has stayed consumer-centric in everything it does. Apple is able to determine what consumers want next and then deliver on it. Brands like Apple (and Google as well) are changing our behavior; how we buy, how we communicate with each other, even whether we speak to each other.
Now, to their credit, Coke has adopted these new consumer trends in communication. For instance, Coke has 92 million Facebook “Likes” compared to Apple’s 11 million and Google’s 19 million. But the important point here is that while Coke has embraced these technologies, Apple (and for that matter, Google) have had a hand in creating these emerging social media technologies. Not to mention, Coke has done little to move beyond marketing carbonated soft drinks – a category that’s been “attacked” by bottled water, energy drinks and specialty coffees.
Here’s the lesson:
Coke adapted while Apple and Google created. Coke responded to change (many would say appropriately). Apple and Google got ahead of it.
Yeah, but funerals and death are different.
Are they? Thirty years ago, everyone (consumer and practitioner alike) knew what to do when a death occurred. There were only two decisions: which funeral home and what merchandise. Today, no one knows (including the practitioner). Thirty years ago, we let change happen to us and the results are there for all to see. Today, we have a BLANK SLATE. WOW! We have a historic opportunity to SHAPE consumer expectations – to get ahead of change.
What about the economy? Well, gee. As the price of personal computers plummeted, Apple continued to introduce “pricey” options. Seems like those darn counter – intuitives are always winning. Remember this:
“Price is only ever an issue in the absence of value”
So – as it relates to funeral service, do you cling to your old business model since that’s the way you’ve always “done it”? Do you define yourself simply as a means for families to dispose of a body at the time of death?
Are you merely embracing innovations once others have created them? I certainly hope not! I hope your service goes being this functional need and creates value for families. But just how do you define yourself? Exactly what business are you in? Is your company one that has created new trends and now values innovation?
Alan Creedy loves to talk about how the Blue Ocean strategy applies to every business including funeral service. As he likes to say, the funeral profession has become so competitive that it seems we’re all part of a shark feeding frenzy – making the ocean red with blood as everyone competes for the same families with the same offerings – many times on the basis of price. What is needed is to find a blue ocean, where conventional wisdom and status quo is leapfrogged by zeroing in on what families truly value rather than just doing what everyone else has done in the past and is doing now.
Funeral directors love to benchmark themselves against other funeral homes. Personally, I am beginning to wonder about the wisdom of benchmarking against just another sinking ship. Kind of like the captain of the Titanic saying: “We may be going down but we aren’t going down as fast as that ship over there.”
Maybe it wouldn’t hurt to benchmark ourselves against something vital and growing; I would suggest looking to Apple and Google. It’s not that Coke has lost value – according to the Interbrand study, it increased its value 2% over the previous year. But Apple jumped 28% and Google skyrocketed 34%.
Don’t get me wrong, Coke is still a great brand and strong company (as are many companies in funeral service), but many long successful companies have lost some of their iconic stature. I have no doubt Coke will continue to grow value, albeit slowly, in the coming years. But in the final analysis, to continue to build a truly great brand, companies and firms must be externally focused on the consumer and anticipating their wants and needs. And perhaps set out for a blue ocean.
A ship may be safe in port. But ships were made to sail the high seas. Is your company ready to set sail for the wide open spaces in the blue ocean or will you continue to feed in the red ocean with everyone else?
When will we stop fighting AMONG ourselves and start fighting FOR ourselves?
Why is it so important in the funeral service culture to find blame? Blame is always a counterproductive force that slows us down and PREVENTS us from the personal accountability we need to move us to a higher plane.
Some years before my engagement with funeral service I was employed as a project manager and problem solver for a company that salvaged distressed companies. One day one of those companies was in danger of losing its largest customer because someone had made a mistake. My boss (one of the owners) called me in to “solve the problem” and save the customer. I set about doing just that. It involved an extra shift and weekend work to get it all done in the time frame necessary. At one point my boss called me in to ask who was to blame for the problem. I told him I didn’t know (apparently I was supposed to know) and he got angry. I responded by saying something like: “Let’s solve this problem and save the customer and we can worry about who did it later.” At that his face became red and his lips pursed. I knew we were close to a blow up because he wanted someone to blame. At the same time we were just hours away from shipping and it was looking like we might save the customer. I don’t remember how I did it but I somehow got back to work without having to figure out who was to blame.
My point is now, more than 30 years later, I am still mystified by why blame was more important than rectifying and salvaging the situation. Yet, in my career I have learned that blame is the first reaction most people have to trying circumstances. In some segments of funeral service the need to blame is almost pathological.
I saw this 3 minute video the other day and it says so much better anything I could possibly say that I wanted to share it with you. Seems to me the question we should ask ourselves is: “Do you want a scapegoat or do you want to see your darn revenue go up?”
There are two fundamental assumptions you must make in order to compete effectively against low price competitors:
Some people buy solely on price…but it is the smallest part of your market
Most people buy on value
Let’s talk a minute about the value buyers. People want value for their dollar. You do. Most people you know do. If you have been an adult very long you know that the cheapest product can often be the most expensive. Your dilemma is that some products don’t lend themselves to value appreciation very well. In other words they don’t readily answer the question, “Why should I pay more?” Funerals are one of these. We do a terrible job of enabling the customer to understand both what they are getting when they pay more AND, just as important, what they are giving up. (and if you say: “we have been in business 100 years” smack yourself. They don’t care.)
So, your primary goal needs to be to enable / empower customers to differentiate on value rather than price. If you have a low price competitor who has been in business more than a couple of years AND you continue to lose calls you can be sure you are not doing this effectively. And if you don’t start then price will become the accepted and only measure.
Be clear and explicit. Detail how you are different and those areas in which you compare favorably. Spell it out. Do it on your website. Consider a comparison chart on those things you do like: “your loved one never leaves our care.”
Actually provide value and customer service. This is a whole lot more than words. It starts with how you answer the phone and never stops. Recently, I was visiting with a funeral staff and one of them mentioned that sometimes they get death calls from neighbors or friends of the deceased before the coroner does and they have to tell the caller they need to notify the coroner before they can respond. I asked them if they gave the caller the coroner’s phone number. They did not. I asked them if it had ever occurred to them that the caller might be under stress and would appreciate not having to look up the coroner’s number. They said that had never occurred to them. Customer service often entails thinking for the customer.
Raise your prices. This counterintuitive move is one few funeral homes will consider but is a classic tactic. Think Mercedes and Brooks Brothers. Higher prices actually HELP you tell your story. (This assumes you have one) Higher prices automatically signal a difference and create a readiness among value minded people about how they might be better served. I have a friend who raised his direct cremation price to $5,000. He is competing with several low price companies charging close to $1,000. He is now more than 4 times higher. The result: he lost about 15% of his direct cremations but still services in excess of 150 a year. You do the math. He can now tell a more compelling story and drive up revenue and create more loyal clients
Don’t play the game. I can see creating a low price competitor as a firewall to keep others from coming in your market but deciding to play the price game is always a downhill strategy. Focus on value, value, value. But talk about value in consumer terms. I have already mentioned “your loved one never leaves our care”. Being in business a thousand years is not consumer minded. Helping people capture memories, tell their stories and being creative is.
Gonna keep this positive. So just a word for background. Any casual observer would see that the declining results funeral service is experiencing signal a much greater problem: A growing segment of the public isn’t sure why they need us or, worse, what they need us for.
Now to better news: Statistically, the odds are very strong that everyone will, someday, die. Most people who die have relatives, friends, loved – ones who will live on. In other words, few people die alone. Most of us, even the very ancient, are part of a community.
So, here are your New Year Resolutions:
Make a goal of becoming relevant to your times. Relevance is not a choice. Many mainline churches are struggling with relevance and declining membersips while the MegaChurch movement explodes around them. Commit this year to finding relevance. Get the heck “out of the box”. Buy some plane tickets and see what others are doing.
Become willing to change. I have a friend who believes EVERY body should be embalmed and viewed. I agree in principle. I was interested when a Caribbean funeral home embalmed a young man who was viewed riding his motorcycle. I thought it was neat but my friend was OUTRAGED. It was improper and undignified. Improper and undignified for whom? Can you say a-n-a-c-h-r-o-n-i-s-m?
Change your attitude. Humans have an amazing ability to attract what they think about. Yes, a lot of things have changed in the last 20 years. And more WILL change. So? Instead of sulking, be excited about the new ways people will learn to commemorate those they love and comfort those left behind.
Fix your skill gaps. If all you like to do is embalming you may have a problem when greater than 50% of your customers don’t require embalming. Funeral directors are typically very nice people. Being nice and being likable is not the same as being a professional expert respected and admired by your community as the “go to death guy”. I recently sent a client of mine with social skill challenges to a Dale Carnegie course. Talk about reinvention…
Stand out. If you want to succeed people need to be talking about you. It is preferable the talk be positive but a little negative really doesn’t hurt. Develop a character and stop being undistinguished. If you live in a smaller town you should never be able to enter a public place without people seeking you out. If you like to eat out, become a table hopper. Oh, and here’s a good idea. Whenever you see a cop, thank him or her for their service. Tell them their life matters and, if they will let you, buy their coffee or lunch. You don’t even have to tell them your name. Bread cast on the water will eventually return to you.
Make a commitment to be focused and disciplined. It is just too easy to get caught up in the “whirlwind” of funeral service. This is one business where there will ALWAYS be a good excuse to defer the important for the urgent. It’s interesting how many of you can schedule a golf game even when you are busy but you cannot (or maybe will not) schedule 3 or 4 hours a week to focus on something important. If you need to, set up an office at home or go to the local library for some peace and quiet.
Believe in yourself. For reasons I understand but need not be trotted out today, funeral directors struggle with self image. Again, we attract our thoughts and if you don’t believe you can and you will, then you probably won’t. Write this down and put it somewhere you can see it regularly: “I believe I deserve better.”
Sometimes the course of our lives depends on what we do…or what we don’t do.
Will my kids be able to enjoy the same rewards and lifestyle as I have?
What am I supposed to do with the investment I have in facilities and rolling stock?
How can I get myself, much less my staff, reoriented to today’s consumer?
What does the public value and how do I transition my company to meet that value?
How do I tell the public convincingly that I offer what they want?
How do I price my services so cremation has less impact on my bottom line?
Is it worth it?
If I sell what is it worth?
If I buy what is it worth?
If I knew what to do, where can I find the resources to do it?
How much time do I have? Is it enough?
It has been said that when one has a hammer every problem is a nail. Yet, we keep swinging our hammer at what used to be a nail but became something altogether different some years ago.
I believe even the most backward of our colleagues knows that we must change to remain viable as a profession AND as a prosperous business. But HOW is the key.
Where Are The Answers??
So, if you feel like you are going in circles; maybe you think you know what to do…maybe not. I guarantee you will be able to sort at least some of it out at my 21st Century Summit October 28 – 30 Click Below to learn more.
And even if you decide not to come remember these pieces of advice:
“By the inch it’s a cinch. By the yard it’s hard”
Just because another funeral director is excited about some idea doesn’t mean it’s right for your firm.
There are answers that apply to you and your situation but sometimes you have to dig for them and more often you have to be willing to hear them.
And finally, the philosophy that has enabled me to successfully engineer a host of business rescues through out my career:
“There are NO new problems. The only challenge is to find someone who has already solved your particular problem and begin moving toward the solution”
And that is what the 21st Century Summit is all about. Join me October 28 – 30 to see hands on one solution. More important: begin to learn how to address your own problem.
When it comes to customers funeral directors are often the nicest people. But being nice and being kind are two different things. It takes courage to be kind. There is risk to it. You don’t really have to be more than just agreeable to be nice. Smile, never say anything bad about anybody and NEVER, EVER be controversial or confrontative. But to do this you don’t need to care…really care….about people. You just have to be diligent in avoiding conflict.
Being kind takes skill, tact and most of all a true desire to help people. You really have to care. You can be nice but not kind. You cannot be kind and NOT care. The difference is caring. You see, caring causes you to want people you care about to do what is best for them. and that means helping them avoid mistakes. It means sometimes having the courage to risk conflict to point out where their actions might cause regrets.
As experts in death care you know what is right and wrong. What will help and what has potential for harm. Being kind is about informing people of the risks of a given action. Two examples:
We all know that an hour’s visitation prior to a funeral rarely works. People don’t show up until the last minute, the family doesn’t have time to interact with everyone they want to and they are forced to endure 45 minutes of anxiety worrying about whether anyone is coming. We should tell them that and make suggestions that might remedy the situation like a brief reception (2 hours) following the service.
We all know that cremation families often experience a need to permanently memorialize their loved one. Unfortunately, they usually don’t realize this until weeks, months or years after the death. When a family tells you they want to scatter the ashes (that’s the word they use) we should warn them of this risk. We should offer options like reserving some of the ashes in case there is a need to permanently memorialize.
Basically, being kind is telling people the truth…even if they don’t want to hear it. You will be surprised how much people appreciate you for it.
Ever since it was revealed that SCI enjoyed a big discount the discussion around the convention lunch table has been preoccupied with the subject of discounts and rebates.
For more than 15 years I have heard a lot about percentages but never about dollars. It’s not my dog much less my hunt but I think it’s time everyone faced the fact that it’s not the size of the discount but how much you pay that counts.
Not long ago I was working on a project with a client that enjoyed something in the range of a 25% discount. I needed to find cash for them so I decided to bid their business myself. Very, Very interesting results. Here are the wholesale averages on just 3 companies:
Current vendor @ 25% $1,630
Vendor B $760
Vendor C $1,363
There is an old saying:
“You can’t spend Percents”
Here is what you need to do what I did:
A generic description of each casket in your selection room
The number of times each casket sold during a recent period (for large funeral homes I use 3 – 6 months for small funeral homes I use a year)
The current wholesale price of each casket including freight AFTER discounts and rebates
Multiply the wholesale price of each casket times the number of times it sold
Total this last column and divide the result by the total number of caskets sold
You will end up with the weighted average price you are paying currently for caskets. Take the generic list AND the number of times each casket was sold WITHOUT the information about what you are paying and MAIL it to however many companies you want to compare. When you receive a response enter their wholesale prices in another column on your spread sheet and multiply them the same way you did for your current vendor. Then divide by the total caskets to get their weighted average price. NOW and only NOW you are comparing apples with apples.
Here is what your spread sheet might look like: CLICK HERE
WARNING:
I don’t recommend switching to the lowest bidder until your current company has had a chance to make a new offer.
I expect every company to ask for an opportunity to change out your selection room to make it more effective. No problem but only AFTER you have selected their company as your vendor. Do not do this before you make your comparisons or you will not be comparing “apples to apples” any more.
So, it’s not my hunt…not even my dog; but I just hate being played.
