Employee engagement is a powerful driver of both customer satisfaction and business performance, making it an absolutely essential KPI for retailers. To improve it, start by measuring current engagement levels within the organisation. You can use a combination of surveys, feedback sessions, performance reviews, and data from management tools to assess engagement.
Once you have insights, focus on addressing employee concerns, simplifying tasks, investing in training, and supporting their wellbeing. Then empower staff with the right tools to boost engagement further. In this article, we’ll explore more practical tips and strategies for success in this arena.
What is employee engagement in retail?
Employee engagement in retail refers to the level of commitment and enthusiasm employees have towards their work, the organisation, and its overall success. It reflects the motivation and dedication employees bring to their roles, their emotional connection to their responsibilities, their team, and the company’s mission, as well as their job satisfaction.
Engaged employees are more likely to go above and beyond their job description to help the company succeed. They believe in the company’s values and goals, work towards achieving them, and, in doing so, also fulfil their personal goals and find job satisfaction.
How to measure retail employee engagement?
Employee engagement is shaped by intangible factors such as commitment, dedication, motivation, happiness, and satisfaction, making it challenging to measure precisely. However, a well-rounded strategy and tools that extend beyond tracking deliverables and targets can help. Effective measurement factors in both quantitative metrics and holistic wellbeing, covering emotional, physical, and social aspects in relation to their work.
Here are some tools to measure employee engagement in the retail sector:
Surveys
Surveys offer an easy way to obtain structured feedback from employees on aspects like job satisfaction, workplace environment, challenges, and views on leadership and broader goals. Its standardised format allows organisations to compare responses across different departments and employees. This consistency helps in identifying trends, spotting recurring themes, and addressing priority areas more effectively.
Although surveys may seem labour-intensive, modern tools simplify the process. With just a click, surveys can be sent to all employees, making it easy for them to respond, while also streamlining data analysis and interpretation for the organisation.
Commonly employed employee surveys include:
1. Annual employee engagement survey
Held once a year, this survey aims to understand employee feelings about their roles, the work environment, growth opportunities, work-life balance, and team dynamics. The findings help pinpoint areas needing improvement and guide goals and strategies for the coming year.
2. Employee net promoter score (eNPS) survey
These surveys determine employee satisfaction through a 0-10 rating of their likelihood to endorse the company as a great workplace. The eNPS data is key in understanding employee loyalty and engagement, with positive ratings being a strategic asset for attracting and retaining employees.
3. Pulse engagement surveys
Employee pulse surveys are short and conducted regularly, providing immediate feedback and insights. Each survey can be customised to focus on a specific issue or theme. Their regularity allows organisations to address issues swiftly, implement adjustments, and track changes in employee sentiment over time, reinforcing a culture of continuous improvement.
Performance reviews and feedback
Regular performance reviews and feedback sessions offer a structured approach to discuss an employee’s work experience. They enable managers and employees to review performance, set and track goals, address job concerns, and identify growth areas. These sessions offer an opportunity to gauge employee engagement, recognise achievements, and collaboratively decide on strategies for improvement. To maintain consistent development, reviews should be held routinely and at pivotal times, such as the start or end of each quarter.
Regular one-on-one sessions
More informal than structured reviews, one-on-one meetings encourage open, genuine discussions. These should be held more frequently to provide employees with a space to share honest feedback, address challenges, and track short-term goals and progress. Such sessions also offer an opportunity for employees to discuss personal matters affecting their work, helping to foster a supportive environment. Insights from these meetings can be used to identify and resolve immediate concerns, as well as assess the impact of recent actions.
Peer reviews and 360-degree feedback
360-degree feedback gathers input from colleagues at all levels, offering insights from various perspectives within the organisation. Some employees may feel uncomfortable sharing certain opinions, whether openly or anonymously.
Additionally, negative feedback can be influenced by personal biases, which may affect its reliability. This approach provides a more holistic view, highlighting an individual’s strengths and areas for development, and offers context to either validate or challenge their feedback with insights from multiple sources.
KPIs and metrics
Data-driven insights provide a more objective basis for evaluating employee engagement. Metrics such as customer ratings, sales figures, task completion times, punctuality, and absenteeism can reveal individual engagement levels. At the organisational level, monitoring turnover rates, training participation, and internal communication metrics (e.g., email open rates and responses) offers a broader view of engagement trends.
Meeting KPIs can reflect an employee’s commitment to their work and goals. Additionally, contributions to team and project outcomes provide further evidence of engagement. Strong parallels often exist between performance metrics and engagement, as high performance frequently stems from engaged employees.
Exit interviews
Exit interviews are vital for understanding employee engagement, as they provide direct insights into why employees leave the organisation. These conversations highlight potential areas for improvement and can pinpoint the underlying causes of staff turnover. By analysing exit feedback, companies can develop more effective retention and engagement strategies. To gather even more candid input, a follow-up post-exit survey or interview can help capture honest feedback after the employee departs.
Performance management tools
Performance management software streamlines tasks related to measuring engagement, such as conducting surveys, providing feedback, managing rewards and recognition, and setting goals. In addition, these tools help track progress and drive engagement initiatives. Equipped to collect and analyse data, they offer actionable insights, delivering a clear picture of engagement levels across the organisation.
Employee engagement metrics to track in retail
Of the various metrics available, here are some key ones to track for a comprehensive evaluation of employee engagement:
1. eNPS
As we already touched upon, eNPS is a widely recognised indicator of employee engagement and loyalty, with scores of 9 or 10 showing highly satisfied employees likely to recommend the workplace.
2. Customer NPS and Customer Satisfaction (CSAT) Score
These metrics are especially important in retail, as they reflect the quality of customer service, which is directly influenced by employee engagement.
3. Employee turnover rate
This metric reflects the percentage of employees who left the organisation during a specific period, with higher turnover often linked to lower employee engagement.
4. Employee retention rate
Conversely, this measures the percentage of employees who chose to stay with the company over a given period, with higher retention rates suggesting higher engagement.
5. Absenteeism
This metric tracks the frequency and duration of employee absence. While some absence is normal, a significantly high rate could suggest disengagement and dissatisfaction with the work environment.
6. Employee Satisfaction Score (ESAT) and Employee Satisfaction Index (ESI)
These metrics directly assess how satisfied employees are with their work environment, compensation, and job experience. High satisfaction often correlates with higher engagement.
7. Training participation rate
This tracks the percentage of employees engaging in training and development programmes. High participation indicates that employees are invested in their roles and interested in growing within the company.
8. Performance metrics
Performance metrics cover a wide range of measures used to assess individual, team, and company performance. Common metrics include sales numbers, productivity, error rates, revenue generation, project completion, and profits. Strong performance often reflects high engagement.
Benefits of improving employee engagement in the retail sector
Gallup’s employee engagement meta-analysis shows a strong correlation between engagement and business success, with more engaged employees driving better outcomes. In retail, it directly impacts key areas such as customer experience and loyalty, sales, and overall profitability.
Given its significance, employee engagement should be a priority for employers, who must aim to maintain and improve it. The first step in achieving this is to understand current levels by measuring them.
Regularly measuring engagement is essential for understanding current levels, tracking changes, and monitoring the effectiveness of initiatives. High employee engagement brings benefits such as:
· Increased productivity
Engaged employees are more focused, proactive, and committed to improving their skills, making them more efficient. They tend to make fewer mistakes, work faster, and deliver excellent service.
· Better customer service and satisfaction
A positive workplace begins with happy employees, which is particularly essential for frontline staff interacting with customers. Their mood and attitude significantly shape customer interactions and experiences. When employees care about their work, they’re more inclined to go the extra mile to provide outstanding service.
· Lower absenteeism
High absenteeism can disrupt retail operations and reduce productivity, making its reduction essential for maintaining efficiency. An engaged workforce is more committed to showing up regularly, minimising absenteeism.
· Reduced staff turnover and higher retention rates
High staff turnover incurs significant costs for companies, involving constant hiring and training. Engaged employees tend to stay longer, helping businesses save on these expenses and maintain a more stable workforce.
· Better collaboration and company culture
Engaged employees are more proactive in working together, leading to smoother collaboration and a stronger, more cohesive company culture built on shared values.
· Better performance and profits
Dedicated employees drive better sales performance, operate more efficiently, and deliver higher quality work. Their proactive approach to work leads to greater overall productivity, making the company more profitable and successful.
· Improved employee well-being
Long hours and demanding customers heighten stress in retail, but increasing engagement can foster happier employees, reducing stress and burnout.
· Easier to attract top talent
Happy and satisfied employees become strong advocates, recommending it to others. Low employee turnover, strong retention, and an emphasis on employee wellbeing further help the company to attract new talent.
Gallup’s survey findings provide further evidence of the above benefits. Companies with high employee engagement report 10% higher customer loyalty and engagement, 78% less absenteeism, up to 51% lower staff turnover in low-turnover organisations, 18% increased productivity in sales, and 23% greater profitability. Furthermore, companies with an engaged workforce are linked to higher earnings per share.
6 ideas to improve retail employee engagement
Here’s how retailers can improve employee engagement:
1. Reward and recognise
It is vital to recognise and reward consistent performance, excellent customer service, innovative ideas, and those who go above and beyond the call of duty. Regular acknowledgment creates a positive work atmosphere where employees feel appreciated.
This recognition keeps them motivated and committed to performing at their best, while also encouraging others to strive for similar appreciation. Monetary rewards aren’t always necessary; gestures like public praise, shout-outs during team meetings, thank-you notes, or giving “Top Performer” awards can be equally impactful.
2. Give voice to your employees
Empowering employees to freely share ideas and concerns is necessary to create a culture where every person feels heard, valued, and equal. Promoting open communication builds trust and helps identify and resolve issues quickly, improving workplace efficiency and preventing frustration among staff from unresolved problems.
You can encourage open communication by actively seeking regular feedback through diverse channels, rather than relying solely on annual reviews. Additionally, an open-door policy, regular team meetings, idea hackathons, and Q&A sessions with leadership are effective ways to foster open dialogue in the workplace.
3. Encourage social relationships
Cultivating positive relationships at work leads to a friendly atmosphere where employees enjoy being part of the team and look forward to showing up. To promote social interaction, consider organising regular team bonding activities, like monthly lunch meetups where colleagues can connect over a meal, or occasional game nights. Other possibilities include team dinners or hosting office events. Starting a book club or a sports team can also offer employees chances to bond outside of work.
4. Invest in employee training and development
Retail employee training brings numerous benefits, with engagement being a key one. It improves performance, productivity, and job satisfaction. Ongoing learning opportunities, clear career paths, and advancement options help keep employees motivated and committed.
The LinkedIn Workplace Learning Report supports this, finding that 7 in 10 people say learning strengthens their connection to the organisation. Employees who see growth potential are more likely to stay engaged and committed, signalling that the company values their professional development.
5. Ensure work-life balance and employee wellness
Retail jobs are demanding, often requiring long hours, extended periods on one’s feet, and a consistently positive attitude. The strain of late nights, weekend shifts, and holiday hours can lead to burnout and dissatisfaction, which may drive employees to leave. Employers can counteract this by actively promoting work-life balance, offering flexible schedules, more control over responsibilities where possible, and adequate time off to prevent burnout.
Although challenging in retail, these measures are achievable with effective workforce management. Tools like Time & Attendance software streamline scheduling, absence management, and auto-rostering, enabling flexibility without sacrificing productivity.
To combat physical and mental fatigue, support employee wellness with benefits like counselling and annual health check-ups. Consider providing an in-house gym or gym memberships. Encourage wellness by organising activities such as cycling events or meditation sessions to foster a healthy, engaged workforce.
6. Empower employees with the right tools and autonomy
Outdated technology can create frustration and delay tasks. Adopting the latest technology helps simplify processes, boost efficiency, and improve employee engagement. Tools such as inventory management and automated checkout software allow retail employees to serve customers more efficiently, benefiting both the team and the business.
Apart from tools, equally important is empowering employees with the freedom to make decisions. Autonomy to prioritise tasks, take the lead, and drive initiatives boosts their confidence and sense of ownership. When employees feel trusted and recognised as capable, they are more motivated, engaged, and driven in their work.
Retail employee engagement examples
Boosting employee engagement is entirely achievable, and many organisations have successfully demonstrated this.
Here’s how some retail organisations improved employee engagement:
Marks & Spencer (M&S)
Marks & Spencer not only recognises the importance of employee engagement in business success but actively prioritises its improvement. Over the years, M&S has introduced various initiatives, including health and wellness challenges, a dedicated wellbeing website, and numerous benefits aimed at enhancing employees’ physical, mental, and financial wellbeing.
M&S also values giving employees a voice, as demonstrated by its “Suggest to Steve” programme, an internal platform where colleagues can propose ideas. Through this initiative, M&S has implemented numerous employee-driven ideas to improve its services.
Examples include offering more diverse and inclusive toy dolls for children, digitising parts of compliance to reduce paper use, and introducing a reuse scheme that enables customers to bring their own containers. Engagement with the programme has grown consistently year on year.
Wegmans
The American supermarket chain Wegmans truly exemplifies how investing in employee development pays off. They support employee growth through cross-training, mentorship, talent pipelines, and long-term career pathways.
They offer paid internships, externships, and trainee programmes to fresh graduates and students, building a steady talent pool. Their scholarship programme, established in 1984, has awarded over $145 million in tuition assistance, benefiting more than 46,500 employees.
Additionally, Wegmans invests over $55 million annually in training through a variety of formal and informal development programmes, remaining a highly successful and profitable business. As a result, they consistently rank on prestigious Best Workplaces lists, with 91% of employees rating it as a great place to work, well above the industry average of 57%.
Common challenges of keeping retail sector employees engaged
Employee engagement in retail is shaped by a variety of factors, and the reasons for disengagement can vary from person to person. It’s important to take a comprehensive approach in understanding these challenges. Some of the most common obstacles include:
· Burnout
Retail jobs are stressful, with demanding sales targets, long hours, physical strain, and challenging customers, all of this takes a toll on workers’ mental and physical well-being. In fact, a Retail Trust survey found that around 80% of retail workers report worsening mental health, often leading to burnout and reduced motivation.
· Unfavourable and irregular shifts
Retail workers are often required to work late evenings, weekends, and public holidays. Long, irregular hours and limited control over schedules make it challenging to maintain a healthy work-life balance. The lack of flexibility can prevent workers from taking time off when needed, leading to burnout and impacting personal relationships, ultimately lowering morale.
· Lack of recognition
Retail staff often feel undervalued, with their efforts frequently overlooked during busy periods. Encounters with disrespectful customers can worsen this feeling, resulting in disengagement.
· Limited growth prospects
Retail jobs are often considered low paying, with few benefits and limited paths for advancement. The repetitive nature of the work can lead to boredom, and without clear promotion opportunities, employees may become disengaged and seek other roles. Fair compensation and career progression are essential for maintaining employee satisfaction.
· Inadequate training
Without proper training, employees can feel unequipped for their roles, leading to delays, poor performance, and reduced morale.
· Communication gap
Retail jobs, being desk-free, often have communication gaps between staff and management. With limited access to emails, employees may not receive updates or news in a timely manner. Additionally, they may struggle to raise issues with managers, leading to feelings of frustration and neglect. When management fails to listen or address these concerns, it fosters a toxic, demotivating work environment.
Employee engagement software for retail
Employee engagement challenges can be effectively managed with the right workforce management systems. Start on your journey towards enhanced employee engagement with Performance & Talent software, which enables effective measurement through “My Mindspace” pulse surveys and custom surveys, allowing employees to share feedback confidentially.
This helps the HR team to stay on top of workforce sentiment, identify trends, uncover areas for improvement, and drive strategic decisions to foster a supportive environment. Performance & Talent also facilitates goal-setting and feedback loops, helping employees stay motivated and aligned with company goals.
Additionally, our Time & Attendance software, empowers employees to manage absences, view shifts, log sickness, and check holiday entitlements. With mobile accessibility, automatic rostering, and manager-enabled shift trading, staff can gain greater autonomy, improving work-life balance and overall employee engagement.
