The Society for Human Resources definition of employee engagement relates to the level of an employee's commitment and connection to an organization. Generally speaking, companies consider it a measure of how likely the employee is to do more than just show up. Whether they’re invested in the goals of the organization, likely to go above and beyond, or even to stay working there.
In retail, some people think that if an employee is “doing their job,” you can’t expect much more from them. But that’s a huge mistake, especially for consumer brands that rely on retail to sell their products. Read on to learn why retail employee engagement matters.
1. Increased customer satisfaction
The statistics are stacking up. There is definitely a correlation between retail employee engagement and customer satisfaction. In 2019, Harvard Business Review reported “a strong statistical link between employee well-being reported on Glassdoor and customer satisfaction among a large sample of some of the largest companies today.” In a more recent employee engagement study from Emplify, "companies with engaged employees had 89% greater customer satisfaction and 50% higher customer loyalty than their disengaged counterparts."
The reverse is also true. Qualtrics XM Institute's 2020 Retail CX report highlights that customers who had a bad experience at a retailer (fortunately a low percentage) had a disproportionate likelihood of decreased or stopped spending at that retailer.
Since the final interactions between a brand and customer frequently take place in retail, and engaged employees correlate to better customer satisfaction, brands have a vested interest in building employee engagement strategies along with their retail partners.
2. Employee Retention
For retailers, the cost of employee turnover is very clear. 2020 statistics show that it costs about 16 percent of an hourly employee's annual salary to replace them, or $3,500, based on a $10/hour wage. For very large brands like a Home Depot or a Walmart, this can be almost a billion dollar problem. For brands, employee retention is often considered a matter for their own team, or for HR to worry about. But If your brand has invested in training retail employees on your products and services, and have built up some brand advocacy, you want those particular individuals to stay on (or return to) the job.
Prior to the COVID pandemic, retail, part-time turnover rates were over 80%. That’s not good if you want people to know about and promote your brand. Developing a good sales rep can take many hours to cover sales training, customer service training, and product knowledge, so when you’ve invested in those reps you want to keep them engaged with their employer and your brand: the first to be effective with that retailer, and the latter in case they DO leave and join another retailer.
3. Employee Productivity
While it may seem that customer satisfaction covers all a brand needs to make money selling through retail, productivity matters as well. Retail employee productivity is often measured in sales per employee, or in sales per hour. If each one of them is not only selling to more satisfied customers, but MORE product, or more of those satisfied customers, then your brand wins.
Increasing engagement through training, motivating them with gamification and rewards, asking for feedback from the retail employees, and keeping them apprised of your company's goals and values can help increase employee productivity for your retail partners.
In short, if there’s a way to get more engagement from the front line workers who sell your product, you’d be smart to try it. The investment in time creating content, your mobile engagement platform, and the road miles in front of them will pay off in customer satisfaction and higher sales.
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