Let's address the elephant in the room straight away. No point sugar-coating it: these are not the easiest times for retailers. In the US, giants like Nordstrom, Macys, Kohls and JC Penneys are at an all-time low. Barney's has already gone belly-up.
However, the likes of Walmart and Target are flying. Amazon has made the move to bricks-and-mortar stores too. A number of luxury brands are also going from strength to strength. So why are some companies barely surviving while others are thriving?
While online-offline strategy and positioning in the market have a vital role to play, the retailers that are continuing to perform have another thing in common: they're invested in their employees. When times are tough, the standard knee-jerk reaction is to cut costs. That reaction is the wrong one – just ask Barney's.
There are four key points that all retailers should bear in mind. If you work in retail and don't have any tattoos yet, it might be worth heading to your local parlour and having them sketch these on your arm. They're that important.
- Retailers are struggling to retain employees. Annual employee turnover in retail lies at 54% and, if you consider that it costs a minimum of $1,000 to replace entry-level non-desk employees without even accounting for losses in productivity and performance, so high turnover takes a chunk out of the bottom line.
- Retail employees are amongst the least engaged. Engagement used to be seen as a touchy-feely HR "nice to have" but, since Gallup proved that companies with highly engaged workforces outperform their peers by 147% in earnings per share, engagement has been appearing high on the C-suite list of priorities.
- Retailers overlook training. A third of retail employees get no training whatsoever, while only 35% receive "very effective" training.
- Engaged employees who receive a good onboarding and training stay in the business longer, put in more discretionary effort in service of the company and deliver better customer experiences.Those companies who are thriving? All providing amazing customer experiences, all invested in employees.
If you've recovered from those bombshells, and possibly your new tattoo, then it's time for a couple more important considerations. You can just note these down tho – no need for body art this time.
The need to provide a great experience for employees now goes beyond satisfying customers and impacting the bottom line. Employee experience is now essential if you want to attract any employees at all. High employment rates mean there are currently more jobs than there are employees in many developed countries. If someone doesn't feel engaged or connected to their employer, they can jump ship for another role which pays more, has friendlier shift patterns or is simply closer to home. This is intensified by a generational shift. Speakap's own research reveals that millennial and Gen Z employees demand engagement and experience from their employers. Oh, and frontline customer-facing industries like retail now comprise 67% millennials and Gen Zers!
The case for investing in employees and the employee experience is clear. If you want to improve that experience within your organization, just where do you start?
Start at the beginning: onboarding
If you want to create a high quality workforce of engaged employees who stay with your company, begin with their very first interactions with you as an employer: onboarding.
Employees who receive a good onboarding are 30% more likely to feel well integrated into their new place of work, 30 times more likely to experience high job satisfaction and 18 times more likely to feel committed to their company. Well-onboarded employee become highly-engaged employees who stay with companies longer.
It's important to have a well-oiled process for all new-hires as good onboarding can't be deferred. After just one week in a new company, 33% of new hires know whether they want to stay long-term; almost two-thirds know whether their new role is a keeper after the first month.
The three phases of a great retail employee onboarding experience
Preboarding: from the moment an offer of employment is made until the first day of work
- Once an employee has accepted your job offer, send them an email or, better still, a message on the company's enterprise social network (ESN), employee app, or intranet. Welcome them to the team and invite them to tell the rest of the team a little about themselves, so that they feel known and recognized when they enter on their first day. Chances are they'll have already struck up some conversation or relationship with colleagues before they even start on day one.
- Provide access to the relevant documents and guidelines, like your employee handbook, which should include details about uniform for the shop floor. Add an organizational chart, so they know who's who straight away.
- Send explicit instruction about where they should be, at what time and who they should ask for on their first day.
"What I love about MorSay is the longevity that it gives us. We're now using it as part of our recruitment, so as we know someone new is coming into the business, we give them access to MorSay immediately. They're somewhat trained and assimilated before they even start working officially." — Liz McGowan, HR and Retail Director, Morley's
Orientation: the first day, week and month on the job
- New employees should be welcomed by their immediate manager. Nothing says "you're not important" like outsourcing onboarding to a more junior team member.
- Introduce new employees to the relevant colleagues and any other departments they're likely to work closely with before giving them a full tour of facilities, letting them know important things like policies, security, the location of bathrooms and when and where to take breaks.
- Managers should take new employees to lunch in the canteen or cafeteria on their first day. It's a great chance to talk about some of the next points in a less rushed and more informal setting.
- During the first week, new retail employees—no matter which department—should be informed about:
- Company purpose, brand, and tone of voice
- Common customer types, their needs, behaviors and how to serve them best
- Their individual and team goals and responsibilities
- During the first week, managers should make sure all retail employees have access to all relevant tools, including any company intranets or internal comms platforms that will be used as the primary communications vehicle between head office and front-of-house employees in particular.
"We actually make it mandatory for our employees to download the Speakap app (iOS or Android) onto their mobile devices when they accept a job with Rituals. More specifically, the store managers have their mobile devices (and Speakap app) on the shop floors all day/during their shifts, while store associates switch off their phones during the peak hours of 12 pm to 6 pm." — Penny Grivea, Managing Director of Rituals UK
Continued onboarding: until the employee reaches full productivity
- Make sure new employees know how to contact their direct manager, their colleagues, and their HR manager if they have any questions. A company ESN is perfect for this as communication is an accessible, real-time low barrier, so employees feel easier using ESNs than confronting busy managers face to face.
- Make sure new employees see the enthusiasm of the team and their managers during this period.
- Line managers should have regular check-ins with all employees, but these should be more regular for new starters. This is where managers can identify training opportunities as well as specific skills that employees might use within the organization.
"The lines are short with Speakap. If I have any questions, I can always directly ask a question to somebody at the Head Office or in our Buying Department." — Mystelle Wempe, Visual Specialist at Hudson’s Bay
Onboarding tips and tricks
Onboarding is not a quick, simple fix. Far from it. Successful onboarding requires a strategy, an agreed process, the right technology solutions to support the process, and buy-in from the entire organization, including senior leadership. Research from Sapling HR suggests that the average new-hire onboarding experience consists of 54 activities.
However, it's undoubtedly worthwhile. A good onboarding experience dramatically reduces the ramp up time it takes for an employee to become fully productive, while it can also improve employee retention by 82%.
For one Speakap customer, the global cosmetics giant Rituals, using Speakap – or Rituals Connect as their branded employee app is called – during the onboarding experience also gets new employees used to using Rituals Connect as their first port of call, whether that's for internal documents, their latest schedules or asking for advice from more seasoned Rituals employees.
“We serve the most demanding consumers in the world, so education and training of our employees is key. We use Speakap to share principles, instructions, feedback learnings and standards of performance. It drives the team productivity and enhances the overall customer service.” Stephanie Nickens, Senior Shop Manager, Rituals US
There are a few tips and tricks that can help retailers of all shapes and sizes to provide their new hires with exceptional onboarding experiences.
- Use a buddy system. Introduce new employees to their buddy on the company social network before they start and they have someone to pitch their questions ("do I need to bring my own lunch?") as well as a friendly face on their first day. The buddy system improves new hire proficiency by 87%.
- Implement a dedicated tool for team communications. Welcoming new employees, introducing them to team members, and providing them with access to relevant documents and handbooks then becomes almost effortless.
- Today's employees want to use technology in their jobs, and they love mobile. Sixty-four percent are happy to use personal devices for work-based tasks. (Bridging the internal)
- However, young employees hate communication clutter and app sprawl. Integrate all employee apps, like scheduling and training tools, into a single employee app for a unified and branded employee experience.
- Provide a platform for new employees to provide real-time feedback and suggestions based on their own onboarding experience, and they'll give you a roadmap for employee experience going forwards.
- Finally, this all sounds like a lot to remember, so make sure you have a great and up-to-date onboarding checklist available to all hiring managers.
Follow this advice, create an up-to-date and documented onboarding process and invest in your people, and you can we one of the retailers who thrive and not just survive during these tough retail times. Oh, and you'll also have some interesting body art!