Written By: Rick Ramos
Do you remember back in 2004 when Oprah gave every member of her audience a brand-new car? "You get a car! You get a car!" instantly became a pop culture phenomenon. The excitement from her audience was palpable. Even today, it’s common to see that scene of Oprah screaming at her audience in blissful enjoyment made into a meme. The truth is, employers are doing the same thing for employees every year. Thanks to rising healthcare costs, employers are spending nearly $15,000 — roughly the price tag on an economy car — per employee per year.
A recent study by Willis Towers Watson revealed that healthcare costs as a percentage of employee pay have doubled from 2001 to 2015, starting at 5.7% and increasing to 11.5% of pay. This is a huge increase in companies' investment and commitment to employee benefits. With recruiting power and even retention on the line, it’s important that employees understand the value of their healthcare.
Perceived value is someone’s evaluation of a good’s or service’s merit and its ability to meet needs and expectations. When it comes to something as abstract as employee benefits, though, perception isn’t the same thing as reality. The perceived value of goods and services is fairly elastic. For physical products, countless studies prove that small changes to packaging, messaging, altruism and more can have a large impact on how people view a product. We can use the same marketing tactics to influence the perceived value of benefits and actually make employees appreciate them more.
Emphasize yearly company spend.
The thing is, your employees probably don’t have a clue about how much your company is spending on their benefits package each year. I’m not implying that you should be 100% transparent on your exact employee spend, but giving them an idea of the ballpark will go a long way toward them appreciating it more. Let them know you care about them and are making every effort to give them the best, most affordable benefits package you can provide.
Communicate the value every month.
When services are ongoing, you’ll need to focus on maintaining the perception of value month after month. That means planning communications for the entire year. Unlock the value in existing benefits by highlighting the ones that aren’t frequently used. While the typical employee benefits package has around 20 different vendors, we’ve had clients with over 100. With so many benefits, it’s easy for offerings to get lost in the shuffle and forgotten after open enrollment. I personally was surprised to know that my health plan had a fitness offering that, for a low fee, enabled me to work out at over 8,000 gyms. That provided a huge value to me. See what your employees care about, and use good communication to unlock the value of those benefits.
Improve the benefits experience.
As you might know, employees are confused about using health benefits. They don’t like the existing experience. According to a study by the International Foundation of Employee Benefit Plans, 80% of employees don’t open or read their benefits materials, and almost half don't understand what they are reading. Shockingly, 31% of employee participants don’t perceive value in their benefits. Much of this lack of perceived value can be attributed to a poor experience. Including a benefits experience platform as part of your package goes a long way to improving all your benefits. As a developer of these platforms, we’ve seen them become the first stop when an employee needs care, and they come with on-demand help when an employee has questions. They have the ability to increase overall benefits satisfaction, lower costs and make things easier for HR.
Improve branding and design aesthetics.
Does your benefits booklet or website look like it hasn’t had a redesign since the 1990s? I’ve seen many examples with subpar designs and a dated feel. They don’t present your employee benefits in the best light and can lower their perceived value. If you don’t have an in-house designer, it’s easy to find some incredibly well-designed templates for Word, PowerPoint, WordPress and more for a very low cost. Put effort into creating a cohesive, on-brand design. Pull in your marketing department, or if you’re in a small HR department and don’t have that resource, I recommend reading The Non-Designer's Design Book by Robin Williams. Within days, your design skills will improve.
The bottom line is that perception is not reality. The way your employees perceive the value of your benefits is as important as the true value. If you want to hire and retain the best employees in the marketplace, you’ll need to use all the communication tools at your disposal to drive value home to your employees.
Source: Forbes Communication Council https://www.forbes.com/sites/forbescommunicationscouncil/2020/04/03/how-to-boost-the-perceived-value-of-your-employee-benefits/#72c68f2f68a3