Segmentation: the key to benefit engagement?

Last year I had the extended family around on Easter Sunday for a roast when I realised the guests came from five different generational groups with an age difference as much as 60 years separating them.

The cooking was a huge challenge with everyone seemingly wanting something different so there was a lot of grumbling on the day as I was unable to keep everyone happy (clearly three different roast meats was not enough for some!)

So this year as I prepare for the next round of Easter family get-togethers I am asking myself ‘how will I go about making sure I provide the right kind of music; cater for everyone’s different tastes; and create an environment where everyone feels comfortable and they don’t leave early’? (unless of course they misbehave!)

A planning nightmare

This is not simply a planning nightmare for inter-generational family Easters. Benefit and reward managers who are having to provide technology to a workforce more diverse than any in history are facing a similar conundrum.

Historically, employers have adopted a ‘one-size-fits-all’ approach with a single platform providing access to a large range of benefits.

Employees then selected those they felt were appropriate. Although on the surface this approach appears to provide an easy self-managed solution, we often find that faced with a large number of options and untargeted communications employees simply don’t engage at all.

The key to getting a workforce engaged in any benefits offering is segmentation. Nowhere is this more apparent than when helping employees save for retirement. Financial benefits provision is a diverse area with employee priorities differing depending on which demographic is being targeted.

Take the example of those in the workforce over the age of 55 who will be actively planning for retirement and learning about which products and services might be relevant. This cohort needs advice and support on how to ensure they have enough in their savings pot to provide the lifestyle they want.

Different priorities

Compare this with someone fresh out of university with a mountain of debt and living month-to-month. Priorities here might be ensuring they are not overpaying on their credit card, basic budgeting and saving for their first home. The two will respond very differently to the type of communication style used however, they often receive very similar information from their benefits team.

Luckily this is where improvements in benefits technology can provide extremely valuable MI for employers enabling managers to target benefit provision more precisely. Advances in the delivery of digital financial advice enables employers to see for example what percentage of their workforce is struggling with high interest debt; those who might need help building up essential cash buffers or where employees are not maximising their employer contributions on their pension schemes.

Armed with this type of information allows employers to segment communications to the most appropriate recipients.

We are increasingly seeing a trend in a number of benefits which use big data to provide insights to the employer to aid them in jumping the inter-generational communication gap.

So just like the food selection for this year’s Easter get together, if you try to be all things to all people, you won’t be anything to anybody. So maybe just stick to chocolate.

Phil Blows is director at Wealth Wizards.

This article was provided by Wealth Wizards.