Jake Johnson on the Acquisition market and Customer Experience



I recently saw a video where Johnson Consulting CEO Jake Johnson was interviewed by Disrupt Media’s Ryan Thogmartin.  It was fairly brief but in watching it I came away with a couple of insights from Jake Johnson that may be of value to those of you who operate funeral homes and/or are owners considering the sale of your funeral home.


First of all, Johnson talked about the acquisition market.  He put potential funeral home divestitures into two categories — the first category was what he called the “Premium Category” and the second category he called the “Common Category”.


I think we all know that what he meant by “Premium” is those funeral home with large numbers of calls located in highly desirable demographic areas. . . demographic areas that are large in population and growing.  Johnson mentioned that those types of funeral homes virtually always have multiple potential buyers and the sale prices are high and beneficial to the selling owner.


Jake Johnson
Johnson Consulting Group

He then talked about the “Common” category.  While no funeral home is really “common” it is meant more as a term for all the funeral homes that don’t fit into the “Premium” category.  These are probably funeral homes in smaller demographic areas or funeral homes that have a great amount of competition or possibly even funeral homes that are in declining population areas.  He also mentioned that the “Common” funeral home also has buyers  —  but the buyers are more “strategic” in nature than the “Premium” funeral home buyer.


By strategic, the thought process of the buyer I come to envision is a competitor that can add ancilary numbers to an already good local business or a neighboring community funeral home that can probably make the transaction work by sharing some personnel in replacing the work of the current owner.


Johnson mentioned the sale pricing of “Common” funeral homes tends to be different as to the differing potential buyers.  These funeral home will bring a different value to different buyers and knowing that going in to the sale offering is important.


Moving on to Customer Experience I found it interesting that Johnson, through his company Johnson Consulting, has access to hundreds of thousands of cliente feedback surveys over the years.  One of the things I noted in Johnson’s interview was that the more services a client family chooses for their loved one correlates to the greater amount of satisfaction they have following the services.  Which tells me that “there is value in the services that funeral homes offer”.


Tom Anderson
Funeral Director Daily

Funeral Director Daily take:  As we move into a greater number of Direct Cremation with No Service clientele we need to always remember that value point and not be afraid to point out services that clients may want to use, but may not even know about.  We have to understand funeral homes are not in a selfish motive when advocating for potentially more services to a family when the data points out that the family will, in general, be happier with the decision also.


It is a tough point to get to because more client families don’t see the value in our services until they have used them. . . .and, if they don’t use most of the services funeral homes can offer, they will never get a chance to use the services that reach that value point.


Sometimes you wonder if the process of funeral service and the values it brings to the consumer is a self-fulfilling decision and result by the consumer.  By that I mean that maybe some client families choose a low level of services paired with low prices simply because they believe that, because of a loss, they cannot see value in anything.  i.e. their own grief has them mired down and unable at the time to move forward in a positive fashion.


Compare that to those that choose more services with the knowledge that “going through the proper” grief steps with a competent funeral director and spiritual advisor will help them, in time, move forward and onward with their lives.


The “Customer Experience” and the “Customer Expectation” in funeral service is an interesting topic.  Again, from my point of view, they almost go hand-in-hand.  It’s very different to have that “Maserati” experience if all you know and are willing to purchase and drive is a “Chevy Volt”.


The age-old question to those in funeral service is not how we raise the “Customer Experience”.  It first must be “How do we raise the Customer Expectation?”


Related — You can see the Thogmartin/Johnson interview here.

Related — To learn more about the services that Jake Johnson and Johnson Consulting Group can offer click here.


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