The funeral market: state of play in 2022

“The important role of the funeral director in society is something that really goes under the radar. Death isn’t something we talk about in this country, and it’s one of these areas where it was very much a conversation of taboo,” says Suzanne Grahame, CEO of funeral plan provider Golden Charter. Having joined Golden Charter and the funeral industry itself at the end of 2017, Grahame affirms that the past four years has been a time of “seismic change” in the funeral sector.

This follows HM Treasury issuing a consultation on the regulation of funeral plans in her first year in the role and the additional FCA consultation of the regulation of pre-paid funeral plans in 2019. With the Funeral Planning Authority putting forward the regulatory proposal in 2020 as well as updating its own rules in relation to funeral clients, Grahame notes “it’s been an interesting start to my career in the funeral sector”. Transitioning her career from the law sector, Grahame joined Golden Charter from Addleshaw Goddard. Throughout her legal career, she was the executive director for Scotland at Addleshaw Goddard, chief executive at law firm HBJ Gateley, as well as group finance director for UA Group plc, and finance manager for Standard Life.

Grahame explains she switched to the funeral industry in a bid to bring her experience of “successfully embedding the right culture to support regulated activity with the client or customer at the heart”, including elements which are “traditionally associated” with a regulated sector like law. “I could see that was where the funeral planning sector was going and the likelihood of the regulatory investigation was already on the cards at that point,” she highlights.

Grahame affirms that funeral directors are far more than the organiser of a funeral – their understanding of the grief journey, their willingness to flex to the variations of grief, family dynamics and funeral wishes is “underrepresented in the general narrative of the UK”. She explains that she was motivated to join the sector as society “fails” to talk about death in the process, along with people’s experience of funerals. “I think that’s changing now but for me, that was a real eye opener. The beneficial impact of a good funeral experience wasn’t hard for me to get my head around at all,” Grahame says.

With four years under her belt as CEO, the majority of which was during a time of upheaval due to Covid-19, Grahame imparts that one of her most notable achievements with Golden Charter is the practical support the company offered to funeral directors throughout the pandemic. This includes assisting funeral directors with funeral planning queries, answering calls for them, and nurturing relationships with customers until the funeral director had time to pick up with the customer themselves. She explains: “During the pandemic, funeral directors were on the front line and working against some unprecedented, difficult circumstances. That was about creating space for them where they could rest assured that we were looking after their customers for them.”

Other practical support provided by Golden Charter includes improving the speed of payments to funeral directors: “We understood that it was a time of additional expenditure for them as they were stocking up on PPE and other things,” Grahame shares. Therefore, the company ensured that funeral directors were paid down to an average of just two days once a funeral was carried out under Golden Charters’ plans, something which the company has maintained since to support funeral directors’ cash flow.

Moreover, Golden Charter prides itself on prioritising the wellbeing of the funeral directors themselves. Grahame asserts: “We were well aware that as a small business, funeral directors were looking after families, the community and their staff. But there weren’t many people reaching out to the funeral director themselves to make sure they were feeling well looked after and supported.” This was facilitated through business manager calls as well as peer-to-peer calls, allowing funeral directors to talk to each other regarding how they were coping, where they were getting PPE, their procedures around meeting families face to face etc.

Looking at the current market, the industry is in a position of “extreme flux” as “the customer has more choice now than they’ve ever had before and they’re far better informed”, reveals Grahame. According to Golden Charter’s consumer research, the pandemic has increasingly encouraged more people online compared to two years ago, particularly those in mature age groups. Prior to the onset of the pandemic, individuals over the age of 75 “weren’t represented as much online”; however, Golden Charter’s research identified that 83% of those aged 75 years plus regularly or occasionally use a smartphone or tablet, a statistic that has increased as they have had to turn to their own resources during lockdown.

Ultimately Grahame believes this has “opened up the market for new players” and has created greater access to information in the digital sphere. “We are at the cusp of even more significant change driven almost entirely by the heightened level of consumer awareness and interaction, making the funeral market a far more open place,” she imparts.

Historically, the funeral industry has been dominated by faith-based funerals, but Grahame highlights a paradigm shift towards traditional funeral offerings which she adds is “one of the most prevalent funeral offerings at the moment”. Additionally, the number of customers selecting a direct cremation offering has “significantly increased over the last 12 months”. National crematoria operators are reporting direct cremations, those with no service or family in attendance, have risen from under 4% to 18% of all cremations in the space of the last year alone.

But why this sudden change? Grahame explains there has been sector-wide increased investment in direct cremation operations with “new money from venture capitalists and private equity finance, which provides a huge amount of capital to spend on infrastructure as well as advertising to consumers and local media”, ultimately inviting customers to think about their funeral from a “different perspective”. Moreover, Covid has meant that customers have been required to have smaller funerals and, at many points, an unattended funeral, which Grahame says has “further encouraged” the change in consumer perception, meaning small funerals might be here to stay. “The pandemic introduced some new thoughts around funerals and some families really enjoy the smaller, more personal funerals, and I see that trend still continuing this year,” she states.

On the other hand, a challenge Golden Charter’s research identified is a “disconnect” between the industry’s definition of a direct cremation from the customers’ understanding of the terminology. Only 33% of respondents fully understand what a direct cremation consists of, while 44% are familiar with the phrase but are unsure of what it entails. “There’s a huge amount of assumption about what consumers mean by direct cremation. For most, it means just a simple funeral – meaning they don’t want extras such as wanting doves released or horses at the funeral,” says Grahame. “There’s a lot to be done to ensure we present the options available to customers more transparently, and for independent funeral directors to ensure customers are aware they have available the full range of services, from an unattended to the full funeral, with whatever additions the family might choose,” she adds.

To tackle this hurdle, Golden Charter has unveiled its ‘SimplyCremation’ campaign, inviting customers who are thinking about a direct cremation to come and speak to their local funeral director. “It opens the door to customers who might not think direct cremation applies to their local funeral director. It provides the option to directly speak to a funeral director rather than hearing it from the end of a telephone line or advert,” Grahame shares.

Another big hurdle in the industry Grahame identifies is encouraging small businesses to be more visible online as “many funeral directors are less sophisticated in their online presence than some new entrants.”. Thereby, Golden Charter launched its free-to-use online service for independent funeral directors, localfuneral.co.uk, at the onset of the pandemic. “It captures online enquiries for independent funeral directors, recognising that few of them can do that for themselves in competition with state of the art digital competitors. It’s now connecting more than 5,000 potential customers a year with their local independent funeral director,” reveals Grahame. Acknowledging that the digital sphere was predominantly influenced by corporates and newcomers to the market who were looking to top slice funeral plan prices, Grahame remarks that this made it “more difficult” for funeral directors to have a “real conversation” with customers about what they want.

With the upcoming FCA date of regulation of funeral planning on 29 July 2022, Grahame says there are steps to embark on to becoming fully regulated on that route. She explains: “We have already invited our partners’ funeral directors to come on board to be an appointed representative. But there are many steps that you need to go through; we’ve got more than a thousand funeral directors to go through that process with. There’s still plenty of time but one which we need to keep the pace up on if we’re going to help all thousand plus of our funeral directors be ready by 29 July.”

Nevertheless, she says Golden Charter will maintain its aspiration for ensuring the 3,000 branches of independent funeral directors which the company works with will “have a journey that suits them”. “It’s hugely important that we help all of these businesses who are all very different, from large businesses to small businesses, from first generation to sixth or seventh generation, to continue to have the good quality conversations they have always had with their local communities,” Grahame concludes.