Breathing new life into the death business

Technology opens up many new possibilities, but traditional attitudes will take a long time to change

An aging population doesn't just spawn opportunities for companies offering care services for older people. It also means business for startups that focus on what follows next - death.

And you may even want to add what follows death - customs like those observed on Tomb Sweeping Day.

Some Chinese enterprises see death and the afterlife as areas that require some planning and professional expertise, with a dash of new technology. The goal of the latest generation of service providers is to ensure those who depart do so with dignity.

Students in Zhuji, Zhejiang province, take part in an online Tomb Sweeping Day ceremony for soldiers. Luo Shanxin / For China Daily

Such startups don't hog the media limelight like their contemporaries who produce high-tech apps for this or that.

The rationale for such seemingly somber businesses might be found in estimates from the Ministry of Civil Affairs, which show that funeral-related products and services in China will likely top 100 billion yuan ($14.5 billion; 13.6 billion euros; 11.6 billion) in sales this year.

A Beijing resident, it would appear, needs 80,000 yuan to die and be buried in the capital. To put that in perspective, an average Beijing resident's annual disposable income is 52,000 yuan. In other words, he or she needs to plan at least a couple of years in advance for death with dignity.

"The profit for a traditional funeral service business can reach 100 to 200 percent," says Wang Dan, CEO of Bi An, a pioneering funeral service company that closed recently. "A decent funeral could cost tens of thousands of yuan, and 50 percent of the cost may go into the pockets of hospital workers."

Death is a market all right, but one without regulation or easily available information.

Hence, funeral services remain a largely exclusive business. The departed go in dignity, the living pay the price. Pain on top of grief.

"This business segment is falling behind modern society," says Xu Yi, Bi An's co-founder.

With almost two decades of experience in the internet industry behind them, Xu and Wang came up with the idea of combining a brick-and-mortar business with e-commerce to allow people to simply click and pick coffins or caskets. That would mean transparency via an easily accessible shopping catalog and much lower prices.

It is a market with huge potential.

"In China, about 10 million people die annually. The number is growing at 0.7 percent annually," says Wang Qin, a consultant at Sansheng Consulting. "The annual revenue of funeral services is likely to reach 600 billion yuan by 2020."

Small wonder that even the big boys of e-commerce, such as Alibaba and JD.com, have been lured to the sector.

Their users can now buy funeral products online. Digital marketplaces such as Taobao, Xianyu and Jingdong Mall also offer a wide variety.

Statistics from Alibaba's online flea market Xianyu show the number of products and services related to Tomb Sweeping Day surged in March, double the total for January and February.

A search for "cinerary casket" on Jingdong Mall produces 898 results for a wide range of products made of different materials. No physical store can match this range or the prices offered - from about 100 to thousands of yuan.

"The same products in stores are twice as expensive. The quality is quite good and the quick delivery is an advantage," says a consumer surnamed Zhao.

Besides goods, there are related services offered online. For those unable visit the graves of loved ones on Tomb Sweeping Day, Xianyu offers help. Service providers listed online will sweep the tomb concerned for a price ranging from 100 to 600 yuan.

An online user identified as Guo Gaoduan, a resident of Xi'an, Shaanxi province, offers such tomb-sweeping services on Xianyu. The tasks he will carry out include tidying the site, wiping the tombstone, laying wreaths and flowers and conveying greetings to the departed. All for 600 yuan.

"Online services for funerals and Tomb Sweeping Day are still in their early days. Their share of the overall market is still tiny. They exist only in big cities where people are more open to new ideas. It's possible they will grow in the future but they won't change the game in the short run," says Wang Qin.

That may be because most of the goods and services associated with cemeteries and funerals, including tea and firecracker supplies, are largely handled by state-owned mortuaries. So, e-commerce could help by introducing transparency and service quality to this sector. But total transformation of the trade may take some time, say market observers.

"Funerals have a long cultural history, which makes it hard to change people's minds," says Wang. "Also, for most households, funeral is a rare occasion. When required, especially on short notice, online services may not be as quick as popping into the neighborhood shop."

So, the business of death and its aftermath may not be ready to ditch its brick-and-mortar incarnation just yet.

"The online shop can attract traffic, and the offline or physical shop can provide the service efficiently," Wang says. "The online service can only function as a consultancy."

According to Wang, running a funeral services business is cost-intensive, which is likely to slow its expansion online.

"Currently, the target customers for online shops are the younger people living in the big cities. The idea is not popular among rural folk, limiting the market size. There isn't an efficient way to promote this business model and change people's mindset in the suburbs."

Earlier this year, Bi An had to close its online business because the experiment did not get enough traction with middle-aged customers. There may still be a long way to go before e-commerce proves to be a game-changer.

Contact the writers at renxiaojin@chinadaily.com.cn