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Time to take the digital benefits approach seriously

1 February 2017

Many a comedian has quipped that they would rather check their Facebook than face their cheque book, but it doesn't have to be an either/or situation.

Employers who capitalise on the opportunities presented by social media to communicate pensions and other employee benefits could find themselves better placed to write out some seriously big cheques.

Generation Y - the Facebook generation - is becoming an increasingly key workforce segment and millions of people are now hell bent on organising their entire lives around their smartphones, including their finances. Employers who don't consider linking employee benefits platforms to hand-held devices are therefore seriously missing a trick, but unfortunately they still constitute the overwhelming majority.

Part of the problem is that many employers are completely out of date with what is now available in the market because technology is such a fast moving phenomenon. Indeed, some have probably never even seriously considered employee benefits platforms of any sort as they have been preoccupied with pension auto-enrolment. Even if they had given the subject so much as a passing thought the technology of only a few years ago could well have seemed prohibitively expensive.

But the auto-enrolment rush is now largely over and the costs of technology have been shrinking rapidly. Only five years ago it would have been hard for an employer to secure an employee benefits platform for under £10,000 a year. But we can now offer solutions for as little as £2,000 a year that can be accessed both by desktops and smartphones.

The smartphone link only started becoming available within the employee benefits space during the last two or three years and was originally dogged by security concerns. But things have progressed pretty quickly and it is fast becoming a standard feature in the market.

It is not only the cost and security barriers that have been reduced. Originally many employers also dismissed online benefits platforms as being too admin-intensive, but market developments have seen a marked fall in the degree of complexity involved.

The simple truth is that platforms with smartphone links are now well within the reach and understanding of even the smallest employers. Unfortunately, however, this message hasn't really managed to get out yet. We estimate that currently only around 5% of our clients utilise smartphone technology for employee benefits.

Indeed, even for desktop usage, the majority of smaller businesses probably limit the online presences of their benefits packages to no more than a few lines on their extranet. So it is high time for employers that offer employee benefits to consider or to revisit the issue of what part online and digital technology could play in driving engagement and return on investment. 

Research from Chase de Vere conducted in December 2016 showed that a staggering 27% of workplace pension members don't know how much their employer contributes to their pension scheme. Additionally, an even higher figure (29%) don't even know who their pension provider is!      

How can employee benefits act as an effective recruitment and retention tool if the majority of employees are largely apathetic or oblivious to what they've got? And what better way is there to engage Generation Y - which is only going to increase as a proportion of the workforce - than to offer access via their beloved smartphones?   

We see no reason why the proportion of our clients that use smartphone technology to link to employee benefits shouldn't increase to around 50% within the next couple of years, and the drive for engagement doesn't have to centre solely around Facebook.

We are, for example, seeing increasing use of YouTube videos for promoting employee benefits, and we find that videos of under two minutes are especially useful. For some people they can be much more effective than an hour long seminar.

If you would like to seek advice from Chase de Vere on how to use smartphones or online benefits platforms generally to boost employee engagement with pensions and other employee benefits then please to not hesitate to contact us on 0345 300 6256.        

The Financial Conduct Authority does not regulate some forms of auto-enrolment