The Cost of Commoditization: Why Funeral Homes Must Return to a Service-First Mode.

By Jay Jacobson, LUTCF, CPC, CFSP – Business Consultant

The Price Trap: A Familiar and Dangerous Story

In a busy Midwestern town, a well-meaning funeral home owner had what seemed like a sure-fire growth strategy: offer the lowest prices in town. “If I can make it affordable,” they reasoned, “families will keep coming.” And they did—at first. But instead of prosperity, the business began to unravel. Profit margins evaporated. Staff morale sank under the weight of long hours and low pay. The once-proud standard of service began to crack. Soon, the owner faced a painful truth: in the death care profession, undervaluing your services can cost you everything—your reputation, your team, and your livelihood. Commoditization feels like the easy path. But it’s a path that leads to burnout, staff turnover, and the slow disappearance of everything that makes your work essential.

From Service to Commodity: How the Shift Happened

In today’s hyper-competitive market, too many funeral homes are caught in a race to the bottom—dropping prices to match online vendors and corporate chains. When that happens, funeral services are reduced to a transaction: "Just the body, please—at the lowest cost possible." When price becomes the only selling point, value disappears. The unique strengths of a family-owned funeral home—personal care, community connection, genuine compassion—fade into the background. Margins shrink. Service suffers.

The Cremation Factor

Cremation now accounts for over 60% of dispositions in the U.S., and with it comes a strong link to price sensitivity. Direct cremations—often arranged online—are simple, stripped-down, and far cheaper than traditional services. For budget-conscious families, these options are appealing. But they often bypass the funeral home entirely, cutting off revenue from embalming, viewings, premium caskets, and in-person memorial services.

Consumers Aren’t Asking for “Cheap”—They’re Asking for “Meaningful”

Families today aren’t necessarily chasing the lowest price—they’re seeking value that fits their lifestyle and beliefs: - Personalization over tradition - Simplicity over extravagance - Meaningful memorials over merchandise The real challenge isn’t to out-discount the competition—it’s to outserve them.

The Opportunity: Reinvent, Don’t Retreat

If you want to compete, don’t slash your prices—expand your relevance. Offer: - Green burials for the eco-conscious - Celebration-of-life events in unique venues - Livestreaming for out-of-town loved ones - Ongoing grief support that extends beyond the service These aren’t just “extras”—they’re proof that families are paying for care, not just convenience.

Winning Back Trust: Lead with Transparency

Today’s families research before they call. They expect clarity, fairness, and genuine guidance. Funeral homes that lean into transparency—open pricing, clear explanations, honest conversations—don’t just close a sale. They build loyalty. They earn referrals. They are remembered.

Bringing the Heart Back to Funeral Service

Commoditization may be the path of least resistance—but it erodes the very soul of this profession. Now is the time to turn back toward what matters most: - Storytelling that honors lives - Ceremonies that create lasting memories - Service that puts people, not prices, at the center Because in the end, families aren’t looking for the cheapest goodbye. They’re looking for a meaningful one.