How To Leverage Holiday Rewards As Year-Long Retention Tools

In today’s job market, top talent is in high demand and employee retention has become more important than ever. Although we’re in the middle of pumpkin spice season, now is the time for employers to solidify their winter vacation rewards strategy. With the right implementation, these rewards can pay off long-term for employers well beyond the new year.

To help you plan ahead, I spoke to Marina Hodges, Senior Director and Head of Incentives Marketing at Blackhawk Network. As a global company working with thousands of Fortune 500 brands, private companies, nonprofits, and other organizations, Blackhawk has distributed billions of dollars in rewards and incentives to help employers increase engagement, loyalty, productivity, and retention to encourage employees.

Gary Drenik: Should employers prioritize giving holiday gifts and rewards to their employees this year (especially in a tough economy)? Do the employees really care about them?

Marina Hodges: Absolutely, on both counts. Employees are your most valuable asset and they are very much hoping to receive rewards and recognition from you this holiday season. Our Workplace Arrangements, Rewards, and Engagement Survey found that 57% of respondents would like to receive a reward from their employer at the end of the year. But while they want to receive those rewards, we found that only a third of the employees surveyed in our Blackhawk Network 2022 Holiday Branded Pay Study, conducted by Leger, expect to actually receive them.

Research from a recent Prosper Insights & Analytics survey found that more than half of employed respondents plan to spend the same or more on gifts this year compared to last year, despite the current economic challenges. If your employees prioritize giving gifts, you should too.

drenik: What type(s) of Christmas gifts do people want and how do preferences differ between generations? What specific considerations should be made to show sensitivity to diversity, equity and inclusion?

Hodges: Spoiler alert: people don’t want a Jelly of the Month Club subscription. And they don’t want anything ignominious like a newly gifted trophy with their boss’ name on it, or a fruitcake with a bottle of water to wash it down (that’s what they are indeed Examples we came across during our research2). According to a study by Prosper Insights & Analytics, people surveyed want to receive gift cards the most this year – and this number is consistently high across different generations.

And it makes sense! Gift cards can offer people almost unlimited flexibility to use as they please, and the freedom to do so will feel meaningful and be greatly appreciated. Prosper Insights & Analytics found that over the past year, professional respondents have consistently noticed price increases across the board for groceries, restaurants, clothing and accessories; Gift cards can help pay for these items or be used to save for larger purchases. People can also treat themselves and buy something they wouldn’t normally have spent money on (think shopping sprees and dinners with friends or family). People have needs and they have wants. Gift cards solve both by allowing people to buy what they prefer.

Holiday gift card rewards can actually be competitive advantages when it comes to retaining and attracting top talent – ​​especially for younger generations. Our 2022 Holiday Branded Pay Study found that if a new employer issued holiday gift cards, four in ten employed respondents would consider leaving their current position. Younger employees are twice as likely to consider going for holiday gift cards than older employees.

Unfortunately, employees report that most employers don’t give out the gifts they like best; Only two-thirds of employees state that they are satisfied with their employer’s holiday gift. This is a huge missed opportunity.

Another potential landmine is making sure you recognize employees’ different backgrounds, cultures, beliefs, etc. Some of your employees may not be celebrating winter holidays, and with several different religious observances towards the end of the year, templates or hyper-specific approaches are not the way to go. Try to create some pomp and circumstance throughout the season – focus on a celebration together to mark the end of a successful year, the prospect of a bright year and recognition for your hard-working teams.

drenik: As part of an increasingly global workforce, how can employers reach geographically dispersed employees?

Hodges: Rely on technology and don’t be afraid of digitization. Gone are the days of walking through an office handing out corporate gifts. Today, employers need to be forward-thinking when distributing employee gifts. As the world gets smaller — and people increasingly transition to hybrid working arrangements that allow them to work from pretty much anywhere — your employees likely won’t all be in the same place, and it will be up to you to find ways to reach them all where they are.

For example, you are planning a virtual Christmas party using video conferencing software. Blackhawk offers technology that allows you to send your employees a Christmas gift card right within this platform – all at once. With a little creativity, you can make that moment of surprise theatrical and fun – and this delivery, combined with the ability to personalize gift cards, will show employees that you’ve put thought, energy and care into recognizing them. Also, despite the physical distance between them, employees will have had a bonding, positive company experience that can help foster your culture.

drenik: Why does a relatively small gesture around the holidays have such a lasting effect?

Hodges: People want to be recognized and thanked for a job well done. Our research found that receiving a reward or recognition would increase productivity and loyalty to their organization for 83% of respondents. With an astronomical voluntary turnover rate in the US right now (think tens of millions) and rampant withdrawal (think “quiet quitting”), treating your employees like this has never been more important you want to be treated. The right rewards and recognition can pay serious dividends in terms of retention and engagement, saving you money in the long run despite the initial outlay. What costs more? Recruiting, hiring, onboarding and training a new employee? Or hand out some gift cards?

drenik: How can employers use vacation awards to engage and retain employees throughout the year?

Marina: Use the holidays as a starting point. Very few people want recognition once a year; Half of respondents to our most recent survey would like to receive monthly or quarterly recognition. Employers can regularly check in and reward employees to keep their business running smoothly and their employees happy.

Let’s go back to the example of the gift card. Many prepaid cards are reloadable, allowing employers to offer spot bonuses and top-up cards year-round after issuance during the holiday season to maintain recognition. Employees will love the bonuses and the regular ways to earn them.

drenik: Marina, thank you for sharing this information ahead of the Christmas season. It’s safe to say that employers should use the above insights as a guide on how and why to approach the holiday bonus season judiciously in order to generate a year-round return on their greatest investment: their employees.