We’ve beaten the recession issue to death. Economists have exhaustively analyzed every way it has impacted every industry, we’ve read about it on the front page of nearly every national news publication for years, and we continue to hear about its impact on middle-class America from both presidential hopefuls who offer promises of moving forward.
Still, as much as I’m ready to leave it in the past, I can’t deny its impact lingers on employees and the way we communicate benefits to them today. The recession brought on new challenges that changed what employees needed to hear about their benefits and what we could say about them—no longer were employers able to offer generous benefits, so what do we communicate now?
Employers of all sizes had to shift from simply telling employees about all of the benefits they had available, to communicating a message that they could still manage what they had left to achieve their goals.
I believe employers deserve recognition for adopting the lessons from the Great Recession: They took the knowledge and insight gained around what was not working in their communication strategies and three years after the recession has ended, the most successful companies are using it to achieve groundbreaking results in helping employees better achieve retirement preparedness and utilize their benefits.
They are focusing more on how to help employees improve their overall wellness instead of “readiness” in one particular area of their financial lives.
These employers have found ways to gather more insight around employees’ personal goals and reach them with more targeted education and information. What follows are three of the most important standards to come out of the recession for better benefits communication:
1) Collect as much data as possible before designing your strategy, from retirement plans, surveys and other forms of feedback to education services and tools you collect employee information from, in order to develop education and communication strategies that interconnect employees’ benefits to their most common financial goals.
Employers who are moving forward from the recession are first and foremost looking at the issues their employees care about most and are addressing those to help them apply their benefits to their personal goals. They are helping them pay down debt, stay within their budgets, pay for college costs, save for emergencies and save more for retirement because those are the things employees want to do using their benefits, some directly, some indirectly.
As a result, employers are seeing lasting change to employees’ financial behaviors, something that traditional methods of benefits communication were not able to do because they didn’t appeal to employees’ reasons for using their benefits to begin with. According to a recent study conducted by a Fortune 500 company implementing an ongoing, multi-platform program, employees who participate in five or more financial wellness services saved on average 11 percent of their income into their 401(k), versus 5.77 percent for those who had only participated in one service.
They also improved their overall financial wellness in every key area of financial planning, with over 90 percent of employees taking at least one step to improve their finances after participating in their employer’s program and 78 percent taking 2 or more.
One example of the type of data employers are using to design their benefits communications is an aggregated assessment of employees’ financial wellness. Below is a flow chart illustrating how employers are collecting data from employees to obtain personalized financial action plans, and using it to design their programs:
These types of assessments are providing employers with data on what issues are most important to employees, by demographic, so they can better design their communication programs to employees’ needs. To view a sample report, click here.
2) Market to employees’ needs, not the company’s. Technology advancements have made it the norm to personalize every marketing message we are hit with, from what ad we see on our social media accounts to what email promotions we receive. We expect everything to relate to our needs and our interests.
Employers realized after the recession that not only would employees respond better to more personalized benefits information, but that they needed it. The one-size-fits-all approach wasn’t going to work anymore; not for employees who were facing new, unique struggles. As a result, employers have become more creative in how they reach employees about their benefits and are adopting concepts that attract employees to participate in their benefits and education programs.
Below, the pyramid of marketing shows some of the top ways employers are successfully marketing their benefits and education programs to employees, based on their level of effectiveness:
When deployed with a strong marketing campaign, the majority of employees will go through the full program - and it's not uncommon in smaller workforces to exceed 90 percent utilization.
3) Grow your education program with your employees. Employers are no longer sitting back after passing out a text book of benefits information at open enrollment period. They are actively educating employees on their benefits options, on an ongoing basis.
They’re looking at where their employees are in their financial wellness at specific intervals within their program: annually, reviewing any large innovations to their programs that will improve the education to meet the changing needs of employees, and semi-annually to address and implement smaller scale improvements to the program, such as adding education topics or services. Without growth, employers ignore the opportunity to effect lasting behavior change in their employees’ financial habits—they will quickly outgrow the program and it will become stagnant.
The recession opened our eyes as an industry to the holes in how we were doing things before. Though we may be ready to move on from it, we should not forget the lessons it gave us for improving the way we help employees achieve their retirement and overall financial goals.
Liz Davidson is CEO and Founder of Financial Finesse, the leading unbiased financial education company in the US. She has recently authored a comprehensive guide on best practices in Financial Wellness programs which can be purchased by calling 424-218-7981. To learn more about the guide, download the abstract here.