“Prejudice always obscures the truth” 0

12 Angry Men

We were recently brought up to speed with goings on at the NAFD. At a regional meeting last week, a gentleman explained to the audience that he didn’t feel that NAFD members should be paying money to comparison websites like Beyond for marketing services. He explained that to rectify this situation, the NAFD would be launching…a comparison website for funeral directors, to be announced at the National Conference in Durham on 18 May, and concluded with the admission that they would likely end up charging funeral directors fees for this marketing service. Hmm, interesting logic.

This one has disaster written all over it. The NAFD, for a brief period last year, enjoyed an Indian summer where their CEO Mandie Lavin whipped the angry old men in their backroom committees into shape and drove them in the right direction. They built bridges with SAIF and looked like they were becoming a credible force, working with the Scottish Government, formulating a joint code of conduct and generally doing what you expect industry associations to do. Since Mandie’s departure, they have been busy dragging themselves back to the dark ages.

They now appear to be operating under the shadow of fear, which is never a good place to make decisions from. Fear of change, fear of transparency, fear that their shadowy committees and gossiped corridors will lose their backroom grip on the industry. This latest decision – to enter a fiercely competed marketplace – with no experience or competency in the area, is an example of that fear breeding bad decisions. At the meeting, they admitted that their decision is purely reactive – they have seen Golden Charter launch a similar service and felt they had to respond. Lemmings and cliffs come to mind at this point.

You can’t be poacher and gamekeeper at the same time

The thing is, you can’t try to be a regulatory body or industry standard, which is where they were going, if you’re at the same time a commercial entity. It’s such a glaring juxtaposition that you must wonder what they’ve been smoking at NAFD HQ. Let’s have a think about how many trade associations in other markets there are. Do you see the Association of British Insurers taking on CompareTheMarket? Do you see the British Hospitality Association competing with Just Eat? I think not.

There are some obvious reasons why it doesn’t happen. Firstly, it means that the trade association loses all credibility and pretence of independence. You can’t go around claiming to be representative of the industry when you’ve got skin in the commercial game. And that works both ways – in this case the stated objectives of the NAFD are to protect members, so how can they expect families to turn to them at a time of need?

Secondly, as an organisation you’re entirely reliant on membership fees for your revenue, and those members include lots of suppliers. In the NAFD’s case, if they are going to start a comparison service, then what’s to stop them deciding to launch a direct disposal service or start wholesaling coffins – where do the boundaries of their commercial ambitions end? It’s not long ago that they sold off Perfect Choice, their own funeral plan, and in May members will be eagerly awaiting answers to the questions raised at last year’s conference about that decision. Long-paying suppliers will be thinking – are they going to come for me next? It would be interesting to see what Albins and Lymns think, because they have just invested another £1.5m in Funeral Zone, and this new site – with an apparent strong focus on reviews – will be directly competing with them.

The main reason that industry associations don’t start commercial offspring, however, is that they are not likely to be especially competent at running commercial ventures or structured well enough to do so. In the few cases where industry bodies give it a go, they generally end up splashing significant amounts of their members’ money hiring outside marketing and development agencies, before an inevitable collapse and retreat. Trade bodies aren’t well stocked with the kind of people who you need to be able to compete in fast moving markets.

How much will it cost their members?

To that end, let’s look at the market landscape. There are already three zombie ‘comparison’ companies out there, who despite credible backers, have failed to get any traction. There’s ‘AboutTheFuneral’, set up by Kim Bird, an industry veteran, which had ex-NAFD CEO Alan Slater on the board. Then there’s ‘DeadRight’, which had the backing of famous ad-executive John Hegarty, and finally ‘YourFuneralChoice’, which I believe originated from funeral director beginnings. They are all effectively on last legs, their advertising largely silent and traffic moribund. The moral of the story is that funeral comparison is not an easy arena to make a viable offering in.

But, I hear you thinking, the NAFD has significant resources from its funeral director members. Indeed, at the meeting, the nice man indicated that his plan for those resources was to outspend everyone to get their new website to the top of the PPC rankings (pay-per-click rankings on Google). Well, I wonder if the NAFD has any idea how much it costs to perform PPC in this market? Bidding on the keywords necessary to compete in this space costs a minimum of £500K per annum, while Co-op are (based on their presence) spending as much as £3.5m. So it’s not going to be cheap – are NAFD members really going to be happy with that volume of their funds being spent?

Furthermore, NAFD’s proposed PPC advertising will compete with their own members’ PPC advertising. How will those member funeral directors feel when their subscription fees are being spent to drive their own advertising costs up, and then the NAFD gives them a call to demand a further monthly membership fee to keep doing it? Overjoyed, I imagine.

Then there are the geographical variations to consider. In Portsmouth, it costs over £17 per click to rank at the top of Google, while in Southall it is a mere £3.25. So, how will funeral director members in Southall feel about their subscriptions being used to subsidise funeral directors in Portsmouth five times over?

Beware the White Walkers

There is one notable offshoot of a trade body that has been successful and it’s very close to home: Golden Charter, the offspring of SAIFCharter, and their funeral plans. Why did it work? It worked because it managed to unify the interests of the independent sector and give them a platform to compete against Co-op and Dignity.

But Golden Charter have recently provided us with a cautionary tale of what may lie ahead for the NAFD. While being brutally savaged by his own audience at the SAIF AGM in Brighton a few weeks ago, Julian Walker similarly called out Beyond as competition and launched his localfuneral website, declaring that they were spending £500k on it and that it would bring funeral directors lots of customers, save them paying marketing fees to comparison sites and…oh yes, similarly they might have to pay them fees for this new comparison service in the future. Can you see a theme here?

So, what happened? Well, they launched their website and it appears that it didn’t work very well. So, after user-testing the Beyond website, they copied a few bits of it almost word for word and tried to play at the top of the Google rankings for a few weeks. They spent a fortune, drove PPC costs for the industry up for a few weeks and then beat a hasty retreat back down the Google positions, white flag waving furiously. The latest issue of SAIF insight says they’ve had a handful of funerals from it, coincidentally for high-ranking SAIFCharter members, having spent many £1,000s. Just a few months since launch, localfuneral is already looking like a white elephant.

The NAFD has failed the public; it’s about to fail its members too

Back to NAFD. Since we entered the market, they have fought us at every step of the way. Instead of looking to work with us, they have tried to ignore us, then to stymie us and then to exclude us. Meanwhile, we’ve done the job that they should have been doing for years – we’ve made the market better for families, we’ve helped expose the greed of corporates, we’ve fought for the little guys and we’ve helped hundreds of funeral directors who had little or no web presence bring themselves into the 21st century. Our customer service scores from consumers are outstanding and the feedback from our partner funeral directors is, almost without exception, positive.

So it’s not as if there’s a yawning gap needing to be filled. Personally, if I were the NAFD, I would be spending my time and money working out how to open up its inner workings to scrutiny by members, to build trust that membership fees are being spent wisely and decisions are being made in the best interest of the members. The lack of transparency in the organisation is remarkable; no minutes or agenda of meetings are ever published, appointments are made by friends selecting friends.

Otherwise, they risk giving the impression that the leadership has deliberately avoided such transparency. The president and vice president haven’t yet managed to implement the governance reforms that were agreed with a 92% yes vote from members at last year’s conference; indeed, the Transitional Board that was agreed has only met once since. Coincidentally, the only person who spoke against those governance reforms was Graham Lymn, the new interim CEO.

Anyhow, my advice to the NAFD is: focus on helping your members. You screwed up once by closing your doors to online entrants and resisting change. You screwed up twice by not leading the move for transparency when there was clear opportunity and public clamour. You screwed up a third time by losing Mandie Lavin, who was taking you in the best direction for your members, giving you public credibility. Don’t make it four in a row by wasting a load of your members’ money bumping up everyone’s costs in the industry for a sure-fire failure of a project.

If the NAFD really want to enter the comparison market, all power to them. However, on behalf of the significant portion of their members whom we share, I would urge them to spend their members’ contributions a little more wisely. If they don’t, the Competition and Markets Authority may finally decide to come and pay a visit.

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Government Probate Fee Hikes to Hit Bereaved Families Hard 0

Family holds up piggy bank spilling out coins

In a controversial move, the government will be changing their official probate fees from £215 to as much as £6,000 for some bereaved families.

At the moment, families who need a grant of representation to settle the estate of someone who has died pay £215 in government probate fees, or £155 if they have professional help. Estates worth less than £5,000 are exempt.

Under the new fee structure, families settling an estate worth more than £50,000 will pay between £250 and £6,000, depending on the size of the estate.

Opponents of the new probate fees have called them a “stealth tax” that will hit vulnerable bereaved families hard.

However, the government has said that due to the higher threshold for fee payment, an extra 25,000 families each year won’t pay anything at all. 80% of those who will need to pay will face fees of £750 or less, with a maximum of 0.5% taken from any estate.

“Fair and more progressive”

In a written announcement, Parliamentary Under-Secretary for the Ministry of Justice Lucy Frazer MP said: “This new banded fee model represents a fair and more progressive way to pay for probate services compared to the current flat fee and reflects our commitment to protecting access to justice by ensuring we have a properly funded and resourced courts system.”

She also claimed that there were “several options” for families to fund the new higher fees and those who struggle to pay may be able to apply to the Lord Chancellor to remit the cost under exceptional circumstances.

“£10 million” in charitable income lost

As well as families, the change in probate fees could also have a significant impact on charities, which often rely heavily on the ‘legacy’ money that people leave to them in wills. The Institute of Legacy Management estimates that the higher charges could cost charities as much as £10 million a year in lost income.

Matthew Lagden, chief executive of the ILM, said that “The government’s own impact assessment acknowledges that the current fees cover the average costs of making a grant of probate, so we are clear that this is a stealth tax, which will be borne in part by charities,”

“We are also very concerned that the government’s impact assessment dismisses the costs to the charity sector as ‘not expected to be substantial’, when the £10m lost to this tax would fund vital services across England and Wales.”

What are probate fees for?

When someone dies, the executor of their will (or if there’s no will, their next of kin) needs to sort out their legal and financial affairs. Their money, property, assets and belongings all need to be passed on to the right people.

To access things like bank accounts, change property deeds, or transfer shares belonging to the person who has died, a grant of representation may be needed. This is an official document that states that a person has the legal right to settle the estate.

To set the grant up, the HM Courts and Tribunals Service charges a probate fee – so called because the kind of grant of representation you get is called a grant of probate if there’s a will. It’s called a letter of administration if not.

On average, 51% of estates in England and Wales can only be settled with a grant of representation.

How are the fees changing?

The current probate fee is a flat rate of £215 charged to DIY applicants, or £155 for those using professional help. It’s the same for estates of all sizes.

The new probate fees will be based on how much the estate is worth in total:

  • <£50,000: no fee
  • £50,000 – £300,000: £250
  • £300,000 – £500,000: £750
  • £500,000 – £1 million: £2,500
  • £1 million – £1.6 million: £4,000
  • £1.6 million – £2 million: £5,000
  • £2 million or more: £6,000

When will the higher probate fees come in?

The new fee structure will apply from April 2019 on.

What Do Customers Want From Funerals? 0

What do bereaved families want from funerals? Beyond CEO and Founder Ian Strang shares his take on why price transparency is just the beginning …

In a few weeks’ time, the CMA will publish a report concerning its enquiry into the funeral industry. The focus of this enquiry – and indeed, the focus of much of the media coverage around the industry over the last few years – has been cost. Are funeral costs going up or down? Are prices transparent? What can we do to help consumers with the cost of funerals? And so on*.

*The answers, by the way, are: flat for independents, up for chains; transparent for around 20% of the industry; and encourage people to use comparison websites.

These are worthy questions, and (disregarding my own self-interest here) it would be difficult for anyone to dispute the fact that Beyond has made huge strides in addressing the issue of price hikes and transparency over the last few years.

Because of our efforts, Dignity have been reduced to calling in the management consultants, and Co-op have (laughably) begun claiming to have started a price war (without actually publishing any pricing, but that’s a blog post for another time). The move towards fair transparent pricing throughout the industry is gradual, but likely now inevitable.

“Is it enough to simply make traditional funerals more affordable? I’d argue that it isn’t.”

But is it enough to simply make traditional funerals more affordable? Is that all that we can do to make bereaved families feel that we, as an industry, are meeting their needs? I’d argue that it isn’t.

When we talk about cost, and the public’s dissatisfaction with the cost of funerals, what we should really be talking about is value. Sure, people aren’t happy paying £5,000 for a traditional funeral with hearse and limousines – but in many cases, they wouldn’t be happy paying £500 for it either. It’s just not the service they’re looking for.

As an industry, we aren’t offering families a lot of choice. Yes, there are options out there if you dig around – you can find suppliers for anything from rockets that shoot your ashes into the air, to flammable Viking longboats. But these suppliers don’t (yet?) have the budget to advertise nationally, and many funeral directors don’t exactly push them.

“When you’re bereaved, feeling under pressure to organise a send-off – any send-off – and you know nothing about the industry, you’re not in any state to research different options. But families do want more choice.”

A lot of us in the business, intentionally or not, steer families towards a pretty standard format funeral. And when you’re bereaved, feeling under pressure to organise a send-off – any send-off – and you know nothing about the industry, you’re not in any state to research different options.

But families do want more choice, and we’re beginning to see some pushback.

Direct cremation is growing in popularity, for one. Often in a Sunday supplement or similar you’ll see articles about it: “Bury me in the garden”, “Stick me in a cardboard box”, etc. Many take a deliberately reactionary stance – rebelling against a status quo that dictates that a traditional funeral is the only “proper” option by shunning a funeral altogether.

That’s not surprising. It’s a lot like the dissatisfaction that many people feel with politics right now – “I don’t like any of the parties, so I won’t vote at all”. Direct cremation is also the least expensive of all the current options. But this recent increase in interest in direct cremation doesn’t mean that this is how the market will go or that it’s what people really want. Direct cremation is just the one of the few alternatives to a traditional funeral that’s easily available.

“No-one knows what bereaved families really want, because we haven’t been asking them. At least, not properly.”

So, what do bereaved families actually want, if not a traditional funeral?

Now, there’s no shortage of vocal factions promoting their own understanding of what families want, which generally correlates perfectly with something they are selling, whether that be service or a product.

But I’d argue that no-one knows what consumers want, because we, as an industry, haven’t been asking them. At least not properly, in a rigorous way.

To find out what the bereaved want, you need to ask them at the point of bereavement. You also need to offer them a wide variety of options, options which may not even exist yet. You also need to ask them in the exact same way each time, without the biases of different funeral directors, contexts or sales materials affecting their decision. And you need to ask a lot of people – at least 1,000 for any kind of statistical significance.

“It’s only now, at Beyond, that there are enough bereaved people going online and choosing funeral arrangements to create a data source set that’s robust enough to analyse. And analyse we do.”

It’s only now, at Beyond, that there are enough bereaved people going online and choosing funeral arrangements to create a data set that’s robust enough to analyse. And analyse we do. We constantly run tests across our website, much like any online business, to try and understand what users want.

Sometimes we invent a service and put it up online for a few weeks to see how much interest it gets. We might take it down again because no-one has clicked on it, but we still count that as a success, because the result is that we understand the consumer – bereaved people who need our help – better.

However, if people really like that service, we may look to develop it. This could be in tandem with our funeral director partners, or we might build an in-house offering, such as with estate administration. In that instance, our partners can then benefit by offering it to families themselves, increasing their service breadth.

“Over the next few years, the funeral industry is going to change more rapidly than anyone can imagine.”

Some of our partner funeral directors would rather we didn’t test. They see every new potential development on our website as a challenge to their business and post furiously about it on social media. This is short-sighted.

Over the next few years, the funeral industry is going to change more rapidly than anyone can imagine. It’s becoming ever-more-obvious that families are seeking different services, different ways to interact with funeral directors.

If individual funeral directors are not prepared to keep up with the pace of change, to invest in technology or partner with technology providers, to work in new ways, then they will stagnate. Because the chains certainly won’t sit still.

Dignity, despite previously being guilty of falling asleep at the golf buggy wheel, are now investing £50m in overhauling their business, introducing tablets, technology and home visits. The Co-op machine will likely respond in kind. And Dignity have the crematoria as an asset. You can see the benefit of that with their new “full-attended cremation service”, booked over the phone.

Will it be popular? I don’t know, but I’m impressed that they are testing new products for their customers. We’re interested to learn as well, so we’ve popped a similar product up on our website to find out whether this is the future or not.

“Funeral directors who embrace the testing, learning and development of new products to serve changing needs will flourish.”

For the first time in decades, we are starting to discover what consumers – bereaved families – really want. We need to be open to this journey of discovery and adaptable to the changes it will bring.

Those funeral directors that entrench solely around their traditional offerings and reliance on walk-ins for customer acquisition will slowly but surely die out. Those that embrace the testing, learning and development of new products to serve the changing needs of the bereaved will flourish.

Change is coming. Let’s embrace it, learn together and better serve the families who need our help.