Do Staff Discount Schemes Work?

Posted in Employee Benefits and Wellbeing, Employee Gift Cards, Vouchers and E-codes, Employee Discounts

by Iain Thomson on Aug 25, 2017 12:00:00 AM

Everyone loves a discount! Don't they?

Staff discounts are one of the most popular employee benefits out there, and the impacts are obvious. People save money – and everyone loves saving money! 

In fact, staff discount schemes can provide savings of up to 15% at a huge range of retailers - which can save your employees a really substantial amount over the course of a year. But it's not just great for employees – there's plenty of benefits for employers, too.

Benefits for employers

Discount schemes aren't just a nice little treat to pass onto your employees – although they definitely are that! There's also an incredibly strong business case for offering them.

With belts being tightened across the UK over the past few years, pay rises have been off the cards for many employees. But the savings from employee discounts can actually work out at far more than someone would receive from a typical pay increase – particularly one in rise with inflation.

This can go a long way to improving staff retention – employee discounts create an organisational culture that really cares about the people who are a part of it, making them feel more values, and more likely to stay. Your employees will also come to rely on your discounts as part of their monthly budget, too, making them less likely to leave you for someone who isn't offering the same.

Are they still relevant?

A recent survey from Glassdoor found that discounts were firmly in the top ten benefits and perks that people want at work, with 17% saying they value them more than a pay rise. When you consider that the humble discount is competing with essentials such as paid annual leave (37%) and paid sick days (32%) for a spot in the top 10, it's even more impressive.

They're used much more widely than you might think. From SMEs to corporates, organisations of all shapes and sizes have tapped into the power of discounts, and found that they've quickly become an indispensable part of their organisation's culture.

So, the simple answer is, yes, they do work – people want them, and people use them. Let's take a look at the how and why.

How staff discounts work

There are a few ways staff discounts can be delivered. Some companies will create their own discount card to give out to employees and organise deals with venues, retailers and so on that give money off when their employees show their card. This can be a nice gesture, but it does take a lot of effort – organisations will have to source these deals and discounts themselves, and it may mean giving something in return.

More commonly, companies will use an employee discount provider – someone who's already worked out these arrangements with the UK's biggest brands. It suits the brands, because it puts them in front of a much wider audience, and it suits the companies getting the discounts because they don't have to do the legwork to build and maintain these relationships.

One way discounts can then be accessed is through a dedicated discount platform. Another is in the form of gift cards, vouchers and e-vouchers that employees can purchase, receiving more in voucher value than they paid in cash. This can be done on an ad-hoc basis, or employees can choose to automatically deduct money from their salary every month to put towards vouchers.

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Benefits for employees

The biggest benefit for employees? Savings! For smart shoppers, it can add up to hundreds, or even thousands per year. Transport and utilities in particular can see people save a lot of money.

With over a third of the population of the UK experiencing financial stress, and the cost of living only set to rise, these savings can really make a difference to people's lives.

Here's a quick breakdown of the average amount people can save annually using the discounts available in our portfolio, for example, based on the Office of National Statistics Living Costs and Food Survey:

  • Transport - £1,507.97
  • Housing, fuel and power - £697.92
  • Recreation and culture - £891.65
  • Food and non-alcoholic drinks - £169.34
  • Restaurants and hotels - £550.80
  • Household goods and services - £152.93
  • Clothing and footwear - £113.76

Top tips to maximise your discount scheme

Reach out to local businesses

As well as providing discounts for the heavy-hitters – your supermarkets, your B&Qs and your IKEAs, a great employee discount scheme also gives staff the option to save at their favourite local places too. Whether it's the café or coffee shop closest to the office, or everyone's favourite bar for post-work drinks, making these connections really shows that you're in tune with how and where your employees want to spend their money. It's much easier than building links with national chains, but any good discount provider will be able to help you. It's great for local PR, too.

Go digital

It's not just about the traditional voucher or discount card – going online can bring your discount scheme into the 21st century. Whether you're providing an online portal for people to select discount vouchers, issuing digital e-codes, or focusing on getting big discounts for online retailers such as Amazon, giving people the ability to go digital is essential. After all, online sales account for about 16% of all retail spending, and it's growing by 2% every single month.

Give people choice

Making sure discounts are actually relevant to your employees is absolutely essential to ensuring they get used, and that they have the impact on people's wallets and wellbeing that you hope they do. Rather than trying to guess what people are going to want, it's often easiest to just cast as broad a net as possible. One-stop-shops such as Supermarkets and Amazon will always be popular, and the bigger your network of more niche partners you have, the better. Any good discount provider will have at least a few dozen of the UK's best-known brands on their books.

Communication is key

It's not good to just provide discounts and leave them at that – you've actually got to engage with your employees to get them excited about their new discounts scheme, and ensure they're actually signing up. It's not enough to just email everyone, either – call meetings, give presentations, put up posters and print brochures. And keep reminding people, too – include it in induction materials, send out a monthly roundup of great deals, and do everything you can to keep it in the forefront of people's lives.

Discounts in action: National Grid


When great, relevant discounts are offered to employees, and they're communicated well enough that people don't forget that they're there, they can really make an impact.

As part of a full range of employee benefits, we set up an employee discounts platform for National Grid, and ran a full communications strategy that included roadshows and brochures to spread the word. It's resulted in a take-up of about 77%, with employees spending approximately £114,000 and seeing savings of £8,500 per month.

Savings like this are a fantastic thing to be able to give to employees – and you'd better believe that people appreciate it. Savings on everything from everyday essentials to luxuries and holidays can really make a difference in peoples' lives, and that's all tied back to you – the employer that made it happen.

Maximising Employee Rewards

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