Customer Service
A better retail customer experience starts with a better employee experience
By addressing team members’ core concerns retailers can lay the groundwork for an in-store experience that keeps customers returning.
November 5, 2024 by Assad Lazarus — Chief Commercial Officer, Purchasing Power
Retailers have experienced several years of turmoil. In 2020, the pandemic caused more than 15,500 stores to close their doors permanently, leading to an exodus of frontline workers during the Great Resignation. A recent study found that even today, 59% of retail frontline workers have considered quitting sometime in the last year, a 22% increase compared to last year. This marks a clear opportunity for retail businesses and HR leaders to take swift action to support and retain their workforce.
During the first quarter of 2024, consumers spent $1.71 trillion on retail items, with only 15.6% accounting for e-commerce purchases. With U.S. consumers still relying on brick-and-mortar retail locations to make a purchase, securing a solid frontline workforce is critical.
Simultaneously, retailers shouldn't rely on job numbers to indicate whether employees are content with their work environment and benefits. Although 87% of retail employees enjoy their jobs, one-third are keeping their options open to other industries, according to Purchasing Power's latest research.
Potential attrition can be attributed to several factors, including on-the-job stressors like working additional hours or negative customer interactions. But off-the-job factors like the rising cost of goods, unplanned expenses or a health emergency may lead this workforce to seek higher pay or better benefits.
If retailers want to minimize the risks of losing talented associates and increase customer satisfaction, they must reevaluate how they address employees' needs.
Purchasing Power's survey identified several areas where retailers can elevate the employee experience in order to improve the customer experience:
A schedule to better fit employees' lives
Retailers must address frontline workers' most difficult realities to minimize employee turnover. Due to labor shortages, many employees are being asked to dedicate more time to their roles. Yet, the benefits don't always match the additional effort.
The survey found that 40% are asked to handle multiple jobs simultaneously, and 41% of employees are asked to work overtime hours with no additional pay. In addition, 39% are asked to do more work in less time.
With the holiday shopping season around the corner, retail employees will soon face heightened consumer demand and more responsibilities to support overall sales, such as inventory organization and management.
Without the proper headcount available to keep stores afloat during the active shopping season, the chance of operational inefficiencies increases, leading to overwhelmed employees and negative customer experiences. For example, as employees attempt to juggle multiple tasks, the chance of inventory issues rise, leading to potential stockouts or missed sales.
To prevent this, employers must take a new approach to schedule management. Fifty-four percent of employees said they want more reasonable hours, and 49% want better control of their schedules.
A benefits program built for today's realities
Purchasing Power's research found that key incentives to keeping retail employees in their industry include better salary (72%), more or better benefits (55%), and better control over their schedule (49%). These findings indicate a clear concern among the workforce about personal and financial challenges they may be facing at home.
Because unplanned expenses such as medical bills, home appliances and car repairs can cause life-altering disruptions, employees are especially looking for financial wellness-related benefits. Based on Purchasing Power's research, 43% said their employer already offers resources to help improve credit scores, while 42% said they have access to yearly tax assistance tools through their employer. However, 31% said they'd also like access to financial counseling, and 29% wanted medical deductible financing.
In addition, respondents said they'd like help managing the costs of large item purchases. Nearly 30% cited auto repair and maintenance as their most common unexpected expense, while just under 20% said major appliance repair and replacement is a concern.
Nearly 90% of retail employees say benefits are just as important as salary. Offerings such as an employee purchase program can mitigate the impact of these significant expenses. Purchase programs allow employees to obtain items such as major appliances, electronics, furniture and car tires via a flexible and convenient payment plan, taken directly from their paycheck. Thirty-nine percent of respondents said they'd be more likely to stay with their retailer if they had access to an employee purchase program.
A rising tide lifts all boats
Retailers have a bright future ahead as consumers look for more personalized attention and experiences that only brick-and-mortar locations can offer. Ultimately, the human touch will support this resurgence. Retailers must provide an employee experience that ensures workers' dedication and commitment to a positive customer experience.
By addressing team members' core concerns — including financial challenges, medical needs, and lack of control over their schedules — retailers can lay the groundwork for an in-store experience that keeps customers returning.
About Assad Lazarus
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