Best Practices

How to Motivate Retail Employees

by Martha Pierson   May 27, 2021

First-line employees in the retail industry are the first to communicate with customers. The responsibility of leaving a good first impression is usually on their shoulders, and as the famous saying goes: you never get a second chance to make a first impression. Politeness and readiness help your customers leave your store with a smile on their faces. Yet, behind the kindness of employees, there lies a mix of tiresome shifts, entire days spent on feet, and a not-so-competitive wage. First-line employees need constant motivation to stay interested and put genuine effort into what they're doing.

Employee motivation is a combination of factors that drives employees to be enthusiastic, committed, and creative while doing their day-to-day tasks. An environment where employees are valued for doing their jobs impacts their productivity, which improves the quality of the provided service. Read on to find out some practical ways for motivating employees in the retail sphere. 

1. Set Up an Employee Recognition System

Supervisors recognizing lower-level employees.

Establishing an employee recognition system is a pretty good way to start. Whether it is through verbal or written praise, employee recognition is about pointing out remarkable achievements and efforts during work. A study shows that 63% of employees are unlikely to look for another job if they are appropriately recognized at their workplace. Retailers can use employee recognition platforms to accomplish this goal. These are some of the most popular ones used by major companies around the world.

  • Fond. Fond is an easy-to-use and multi-faceted rewards and recognition program that transcends international teams all over the world. Employees can receive praise from their supervisors and send and collect points to each other for hard work. They can later use these points to access a myriad of rewards and discounts. It also involves a data analytics feature that allows managers to track employee performance and better support them. One of the main benefits of Fond is that it's available in multiple languages, breaking the language barrier between diverse personnel.
  • Bonusly. Bonusly allows organizations to preach their company mission by connecting and recognizing everyone with the help of eye-catching and exciting visuals. Employees receive monthly allowances that they can spend on giving bonuses to their peers. Recognitions are visible to everybody in the team so that all team members can see significant work happening in the company. Managers can view their employee's strengths and praise their incredible performance.
  • Kudos. Apart from peer-to-peer recognition and customizable rewards, Kudos also offers the opportunity to record video recognitions and upload them on the platform so that everyone can see them. Kudos also prioritizes birthdays and anniversaries of employees by publishing congratulatory messages and fostering everyone's participation in the celebration.

2. Reward Employees for Good Performance

Manager rewarding employee with a cash bonus.

One of the main reasons why some retail employees do not stay in the same position for a long time is the comparatively low salary. According to the U.S. Bureau of Labor Statistics, the mean average annual salary of a retail salesperson is $30,940, which is less than an average American earns. Motivating and managing store employees by praising them is pleasant, but at the end of the day, most salespeople work because they've got bills to pay. And a little extra money from time to time would always cheer them up. A brand new employee will automatically feel motivated when she knows about available bonuses ahead and what she needs to do to earn them. Here are some types of rewards and occasions:

  • Salary Reviews. Having established periods of salary reviews will incentivize newly hired employees to do their best to qualify for a wage increase when the time comes. The retailer may organize quarterly or semi-annual salary review procedures based on performance. And if there is an employee recognition system in use, managers may make fair decisions based on the real data they have accumulated.
  • Year-End Bonuses. This one is more like a Christmas gift and is not solely based on performance. It's a nice way to congratulate everyone on the beginning of a new year. Even those who lag on performance will still feel like a part of the team and step up the game for the coming year.
  • Employee of the Month. Choosing an employee of the month is just like the Oscars of the workplace. The retailer can have monthly bonuses prepared for the employee of the month, and the recognition program may help supervisors pick the right candidate each month.
  • Birthdays and Anniversaries. It's very probable that some store employees will be working from 9 to 5 on their birthdays and to thank them for dedicating their time to work, give them a present in the form of remuneration or a gift card. Workplace anniversaries are also good occasions to acknowledge your staff member for staying with you and give them a raise.

3. Encourage Open Communication

Business professional jogging up outdoor steps.

Open communication plays a massive role in every company's prosperity and viability. Poor communication can cost a business about $420,000 per year. A culture of open communication improves employee engagement and productivity when everybody clearly understands their roles and responsibilities. When the top management conveys the company's main goals and objectives to the employees, they know exactly what the company aims to achieve and will play their part with precision.

One of the most effective ways to establish clear communication with employees is to organize frequent one-on-one meetings. In the course of these meetings, managers can evaluate how lined up their performance is with the company's mission and provide feedback. Managers need to keep in mind that giving feedback has to be both ways and is crucial for building trustworthy relationships at work. Listen to what your employees have to say about the management and work towards improving their experience too. 

4. Establish Flexible Schedules in Advance

Retail employees need to maintain a consistent work-life balance to be productive. Some retail stores are open until late at night, and spending all their evenings stuck at work is not going to keep them satisfied with their job. To help store employees organize their time in and outside of work, make their monthly schedule available in advance. This way, they'll know exactly when their shifts are and will have more time to plan their tasks accordingly. The schedule should be flexible. Don't be surprised if salespeople sometimes approach asking to change their shifts with somebody else. Emergencies happen, and supervisors need to have compassion towards their team members. Allow them to take their day off if they really need to in return for covering for somebody else another time.

5. Stimulate Career Development

It's highly likely that retail employees will not stay with the company for a long time if they are stuck in the same position with the same salary. However, it may be a good starting point for launching careers. Having a clear career path in the workplace is a reliable answer to how to motivate retail employees. Demonstrate and explain how front-like employees can work their way to becoming supervisors and managers one day. Many middle-level and upper managers probably also started as salespeople first, and many employees would want to be in their place.

Delineating the entire career trajectory with a clear description of tasks and timelines will spark the interest of most employees and give them an opportunity to climb the career ladder to senior positions.

How to motivate retail employees is a task that every business should take seriously. At the end of the day, they are the face of your store and bear the responsibility of interacting with customers face-to-face. The presented strategies will make sure your employees are on the same page with the store's mission and feel like valuable members of your team.

Martha Pierson, author at OpenLoans
Editor-in-Chief
Martha provides financial and business management analysis for retailers and service providers.