Employees are any company’s greatest asset. Hiring and retaining the best employees is always a challenge, especially during periods of low unemployment.
Offering an array of benefits that go beyond healthcare and 401(k) plans is a great way to stand out from competing companies hiring from the same talent pool.
The number of companies offering employee financial wellness programs is growing as research shows the economic impact of financial stress.
- 80 percent of employees state they have stress related to personal finances1
- Financial stress costs U.S companies half a billion dollars annually2
In an era when consumer debt is rising along, healthcare premiums have risen 55 percent3, and salaries are not keeping up with the cost of living, many American’s bring-home-pay has 20 percent less purchasing power than it did 10 years ago.4
Helping employees by offering an employee discount program can be a great solution. A Harris poll conducted for Corporate Wellness indicated that 67 percent of employees state they would use such a benefit if offered.5
However, unless you carefully choose a quality employee discount program, such a benefit could actually hurt financial wellness rather than help it. Just imagine a cash-strapped employee who feels enticed to use a “coupon” on something they wouldn’t normally have purchased. Instead of saving 30 percent, this employee actually spent the other 70 percent that would have otherwise remained in their wallet.
Additionally, offering coupons for items not needed or wanted by your employees is a good way to waste money that could be spent helping them become more financially sound.
The challenge for HR professionals is to find an employee discount program that makes sense for the company while enhancing employee financial wellness.
What Brands Does the Discount Program Offer?
You want to be sure that the brands offered in the program are brands that your employees recognize, want and use.
Find programs with brands that are well-known. This can be national chain restaurants, grocery stores, merchandise, and services. Although your employees may not use the national brands daily, having some highly recognizable deals will give the program credibility.
Does the Program Offer Local Deals?
Even though online shopping has grown in recent years and 67 percent of millennials and 57 percent of Gen-Xers prefer doing so6, most purchases (90 percent) are made in local brick-and-mortar stores. These purchases include restaurants, auto repair, hair salons, retail stores, museums, golf courses, movie theatres and fitness centers.
It is important to find programs that offer local discounts near your place of business, as well as within the communities where your employees live. The point of an employee discount program is to help your employees save money on things they typically buy, experiences they have, and services they need. When you offer these types of discounts, they will perceive this benefit as worthwhile.
Are the Deals Exclusive?
An employee discount program is no good if your employees can find the same or better deal online. Imagine how an employee would feel if they used the discount program for 10 percent off the movies, only to discover that through an online app, they could have received 15 percent. The best programs offer private deals of great value.
Always look for programs with an average discount of 25 percent in addition to Buy-One-Get-One (BOGO) offers. Avoid programs that have a large number of merchants offering 10 percent or less. Remember, the goal is to offer great deals to your employees that they cannot get anywhere else.
Will My Employees Care About the Discounts?
Most programs offer great discounts on one-time-only or rarely-used products and services such as tax preparation or spraying for ants. Although it is great to have a discount when you need such services, these are not something an employee would use regularly.
To make a program relevant, the discounts should be for things your employees purchase on a regular basis. Although it is best to survey your employees about their spending, you can get a general idea by looking at how American’s spend their money based on the April 2019 Bureau of Labor Statistics report7:
- Transportation – 15.9 percent
- Food – 12.9 percent
- Health-related – 8.2 percent
- Entertainment – 5.3 percent
- Clothing – 3.1 percent
- Education – 2.5 percent
Additional Issues to Consider
In addition to the discounts offered by the program, there are other issues to consider, including:
- Are discounts easy to redeem?
- Are there many ways to redeem discounts such as mobile coupons, print coupons, online purchasing, and promotional codes?
- Can an employee use an offer more than once?
- Is customer service available to the employees for questions and problems? Is this dedicated support and what are the hours of operation?
- Does the program collect employee data? If so, how do they keep it safe and do they sell the data to other companies?
- How expensive is the program? Do they offer price-breaks for a larger volume of employees? Are there additional fees for setting up the program or requesting specific vendors to be included?
- Is there a contract? If so, how long does it last?
- How often can you update the contract to reflect an addition or subtraction of employees?
Finding the right employee discount program can certainly make a difference to the financial wellness of your employees. However, not any program will do. You can help your employees stretch their paycheck by offering a quality discount program, and then integrate this program with your overall financial wellness initiative to drive financial wellness engagement higher.
For more tips on increasing engagement in your financial wellness program, check out 5 Strategies to Help Increase Financial Wellness Program Participation.