Is the Funeral Industry Growing?

From the outside, the funeral industry looks like foolproof profitable venture that could not possibly fail, could not possibly shift with the turning tides of the economy.

Until modern science catches up with science fiction, or some brave explorer discovers the true fountain of youth, death is a certainty. That, however, does not mean that the funeral industry is a certainty, or that it will continue to grow.

The funeral business is like any other business, where it experiences downtrends, profitability can take a turn for better or worse. Smaller funeral directors and large franchise directors alike have to shift their business models to accommodate these predictions and trends, provide services accordingly, and try to keep their heads above water.

In fact, the previous five years had been predicted at a downtrend in the industry of death, as more and more families decided to cremate their loved ones, rather than proceed with a traditional burial. [1]

“Last year, the NFDA estimated the current cremation totaled 53.5 percent compared to 40.5 percent for burial; the national cremation rate is projected to reach 80 percent by 2035.” —   Allie Volpe

A traditional burial can seem impersonal. The process has not changed over several decades for many funeral homes, and while that might be comforting for some families, it means they have even more ability to shop around in the age of technology than before, knowing they will get a similar service wherever they go.

In this article, BSF will discuss emerging trends to keep funeral homes profitable, whether the funeral industry is growing or not.

Is the Funeral Industry Growing?

The key market in the funeral industry is growing older every day. [2] The funeral industry should be ripe for an upward trend in profitability and volume of sales. Everyone knows the routine. Turn 65, start pre-planning your funeral. Sudden death? A close family member arranged the services, and the family had a chance to mourn their loss through a viewing, memorial, and burial service.

“The funeral industry in the USA is estimated to be more than a $20-billion-dollar industry with an estimated 2.7 million funerals per year. And the key market, Baby Boomers, have 10,000 people turning 65 each and every day.”  —   Bernhard Schroeder

It seems like a straightforward question to ask, but is the funeral industry growing, or is our perception of death just closer to home than ever before?

In early 2020, the pandemic brought fast change to the comfortable routines that everyone grew accustomed to around the subject of death.

This complete funeral service can range anywhere from $20,000 and up depending on the funeral home chosen, the amenities provided, and how attentive the funeral director is for your service, whereas a cremation service can range anywhere from $900 to $3,000.

It’s no secret that cremation services are the more budget-friendly option, but with the abrupt financial hardship endured by so many in the pandemic, and social distancing and community lockdowns preventing the family from gathering to mourn their loved one’s death, it has become the only option.

So, is the funeral industry growing? It’s a difficult prediction to make with the recent pandemic still affecting daily life, but one thing is for certain: it’s time for death to change.

A New Look on an Old Industry

Funeral homes have operated with the same set of services families can expect for generations, despite changes in technology and society alike.

Death is certain. That will never change.

What will change is the profitability of the funeral industry and how many funeral directors will be able to continue following their passion.

In the face of the world changing and the potentially grim predictions for the profitability of the funeral industry, a call to action is necessary.

Funeral directors need to look at the emerging trends in the world and determine if they can adjust their services to serve a younger generation that is beginning to look at death a little differently, whether by necessity, or by societal progression.

This new face of the industry is unconventional, breaking the trends of the past. Hopefully, with enough forward momentum, it will break the downtrend and begin a new, more positive financial projection for the funeral industry.

Several pioneering funeral directors already offer these services, many with great results, even in the face of the pandemic. This is promising news for those who are just barely keeping their heads above the waters of debt.

Advanced Funeral Planning

If you do not already offer advanced funeral planning, now is the time to start advertising your services for individuals age 65 and older. This is also known as “preneed” plans, or “preplanning,” and these funeral services are often arranged by the individual who the funeral would be for.

This is an excellent service to give baby boomers peace of mind that, in the event of their death, their family will not be as financially burdened. This also gives individuals control over their legacy. They finally have a say over their end-of-life care and any final wishes they have regarding the funeral.

In some cases, these funeral arrangements are made by family members of the individual the services would be for, such as a child or a spouse who is acting on behalf of the individual.

A Rise in Cremation Services

Since the early 2000s, the funeral service industry has experienced a rise in the number of cremations, as more families are opting for a simpler burial service that is less expensive and simpler. In 2015, the number of cremations exceeded the number of burials; through the pandemic, cremations surged due to the demand for funeral services, while new innovations began to take root.

Cremation services are expected to continue outpacing traditional burials and graveside funerals through 2030, while visitations and memorials may become more common place prior to the service. This has forced many funeral directors to change business models and start thinking about innovation in an industry as old as time itself.

When all the living wants to do is grieve and take their time to grieve their lost loved one, funeral planning can be a burden. As this trend has expanded, more and more families are learning that they don’t need the funeral home to provide them with expensive, lavish funeral services, when they can pay their respects in a more private and personalized way.

This has, unfortunately, been a problem for many funeral homes who primarily provide funeral services. While the family may choose to have a memorial or viewing with the cremated remains, the lost profit from casket sales, embalming, and graveside funeral services have taken its toll.

For a time, many funeral home directors avoided performing cremation services because the profitability was simply not there. Now, it is common to have cremation services provided as an alternative to a burial, which is carried out rather quietly, often within the same building.

Funeral directors who have yet to offer cremation services will miss out on the potential revenue generated by families who continue to be affected by the pandemic, who are unable to attend the funerals of their loved ones, or those who have simply realized the value of a more personal, inexpensive funeral service. Cremation services and an urn are provided to the family which they can display as they wish. Though the cremation itself does not bring in as much revenue for the funeral home as full funeral services do, the process is much shorter and incurs fewer expenses, allowing the funeral home to take in more clients as a result, expanding their scope of services and service area.

Eco-friendly and Sustainable Options

With each passing year, more people are aware of the burden we place on the environment. The toll of funeral services is astounding, and many funeral directors are beginning to answer hard questions from their potential clients about just how many chemicals they use in funeral services, or the amount of fuel burned in cremation services.

The innovative answer that many funeral directors are responding with are alternative, or non-traditional “green” burials, where loved ones may be buried in natural ways without embalming chemicals.

More families are opting into eco-friendly and sustainable options to help reduce their impact on the environment, even in death. These alternatives to traditional funeral practices include biodegradable caskets, green burials, body farm burials, and aquamation, which is the liquid alternative to cremation.

These options are opening up a new realm of possibilities for families who wish to remember their loved one in a peaceful, calm setting, knowing that their loved ones’ bodies aren’t contributing to harming the environment.  

Individuals concerned with eco-friendly burials often opt for something called green burials, where the body is laid to rest in a bio-degradable casket or shroud. No chemicals or preservatives can be used on the body, and the family can choose from a variety of live grasses or flowers to plant over the burial site. The grave is often dug by hand and the body can decompose naturally; these burials may also be performed outside of cemeteries with the oversight of a funeral director.

While these options are all relatively new to the funeral service industry, they are being welcomed with open arms by clients, providing a promising step forward in the first of many funeral innovations in a changing world.

As the industry shifts, the families of the deceased will be able to better articulate what they’re looking for, no longer held to the standards of tradition, and better able to consider what their loved one would have wanted to be remembered by how they lived their life.  

Personalized and Meaningful Services

Funeral homes have changed little in the recent decades. Still, many franchises and small homes alike offer the same somber funeral service that everyone has come to associate with death. The viewing, which may or may not be open casket, is followed by a quiet, somber memorial service. People cry, emotions run high, and everyone shuffles outside to watch the burial.

This has a retro, familiar feel for many people, and many people might still prefer this atmosphere to alternative or new funeral services, as it brings some normalcy back to their lives. Over the past few years, however, demand begun to increase for funerals that celebrated the deceased’s life, rather than remembered them in a way that emphasizes the feelings of grief and loneliness for the living.

Funeral directors who wish to move ahead of the curve can begin offering more personalized and meaningful services to their clients. For many, the funeral itself invokes depression when they would prefer to celebrate their loved ones’ life with laughter, good company, and many stories.

Asking the family about how they would prefer to celebrate their loved ones’ life is an important and unconventional question that many don’t expect but readily consider.

As a funeral director, it’s your job to ensure the funeral service caters to the wishes of the deceased as well as the living, which is why many directors are preparing their funeral homes for offering more celebration-style funerals in addition to traditional, somber services. Be ready to provide a structure or a couple of potential ideas of how they can celebrate their loved ones’ life, as many families won’t think about this ahead of time. This simple question will give your funeral home a fighting chance in a sea of competitors.

Meeting Consumer Needs with Technology

In the modern world, many wonder why funeral directors have not yet begun using technology as readily as other industries. Perhaps it is the fact that things have always been done a certain way, and funeral directors are unwilling to consider – or haven’t considered – diving into the technological world, with the exception of email and telephone communication.

Unfortunately, email and telephone communication alone will not suffice as the world moves further into a digital age. In 2020, funeral homes began considering alternative avenues as many attendees were unable to host funeral services for loved ones affected by the pandemic.

This began the bulk of the digital innovation within the funeral industry, and continues to inspire funeral directors to look for new ways of coping with such events in the future.

Online obituaries are the most recent technological addition to many funeral home services, which seems like a permanent addition to the funeral service status quo with how well it has been received in previous years. These online obituaries are held temporarily as a part of the funeral service, or attendees can donate to the funeral home to keep the memorial page up for a longer timeframe.

These pages make it easy for the living to remember and leave writings for the deceased and continue to celebrate their life throughout the years, which can help aid in the grieving process, especially for individuals who cannot visit the graveside as frequently as they’d like.

More adventurous funeral directors have begun livestreaming the funeral or memorial services so family members and friends who cannot be physically present can still mourn and celebrate their loved one. Especially as many family members are unable to gather due to the pandemic, this has been received with open arms.

There is a strong likelihood that this will also persist after the pandemic, as more businesses are moving towards online platforms and digitizing their businesses to withstand such events in the future. Overall, the costs of livestreaming the service are low, and recording the service provides families with the option of purchasing the video to review and help them through the grieving process.

Online Grief Support

Grief is an intense experience, and no one knows how to handle it. There is no right way to go through grief, but often, if a spouse, child, or other close family member passes away, it can be even harder on the ones left to grieve. The worst feeling in the world is to feel like you are alone, and to be alone in an empty house that was previously filled to the brim with life.

Friends may tip-toe around a subject, but interactions can seem shallow. There is no roadmap to grief, and few talk openly about it, making it a taboo subject which only harms the ability of those grieving to come to terms with their new life and begin healing.

Online grief counseling can help those the deceased left behind adjust to life without them, and give them an opportunity to connect with others who are grieving and show them that they are not alone in the experience, no matter how isolating it can feel. This is a service that extends throughout the funeral process and beyond, for as long as the individual needs the support.