At the PLANADVISER National Conference, Connie Weaver, executive vice president of TIAA-CREF, began her keynote talk by explaining that despite the many decisions plan sponsors face in programs, regulatory responsibility, plan menu and other areas, advisers cannot forget the many decisions participants face when thinking about retirement. Employee engagement is key in getting participants to face these choices and take action. “They should be making decisions, becoming a lot more aware of where they are, what they know, what they don’t know, who they can trust, how to get advice, and we’ve seen a lot of evidence that shows that if these steps are taken early on … the outcomes will be fundamentally different,” said Weaver.
Weaver said that providers, advisers and sponsors need to work together to keep participants their main focus. “It’s really a cooperative view,” she said. ””It’s an ecosystem, where if you think about the goals of the plan sponsor, the goals of people like me who are the provider, the goals of folks like you—both in a consultant capacity and an advisory capacity—[are] all revolving around that end user.”
When creating and implementing an employee engagement program, you must take five steps:
- Understand the customer’s needs;
- Segment the customer base into groups based on behavioral characteristics;
- Draw on analytics and data;
- Use that data to create an engagement program; and
- Measure your results.
Weaver stressed that advisers need to understand their customers before they can tailor an engagement plan for participants. “Spend a lot of time matching the data of what people are doing with behavioral capabilities,” Weaver said. Look at both qualitative and quantitative information because understanding those needs will help when segmenting the customer base. Weaver added, “The words we use, the approaches we have, it’s all about meeting people where they are in their lives, where they are in their circumstances and what their needs are, and then starting the journey from there.”
Weaver suggested breaking down the customer base into five groups of people: dollar stretchers, who live paycheck-to-paycheck; life builders, who are focused on basic life aspirations; accumulators, : those growing their assets; transitioners, those shifting from accumulation to distribution; and the established, who are living in retirement.
Knowing where a person is in his life will help to understand how he will engage with his retirement. Dollar stretchers are significantly more likely to focus on financing basic, current needs, unlike accumulators, who are in a position to be very proactive with retirement saving. This information will help advisers to formulate an employee engagement plan. “One size will never fit all, and that’s more true today than it’s ever been,” Weaver said.
The third and fourth steps—drawing on analytics and data then creating the engagement program—are very closely connected. Being aware of analytics and data in regards to individual segments—such as age and gender—enables advisers to tailor a unique program for those individuals. Weaver advised applying this specialized information to employee communications and linking that content to your firm’s website so clients can find action-based information that is very relevant to their experience and needs.
After creating and implementing an engagement program, it is important to review the real results, looking for any problems within the program and expanding on those aspects that work well. TIAA-CREF did so after a recent program conducted at Caltech. One part of the program involved a series of workshops tailored for women. “To come in and lecture and start with a bunch of [industry jargon] terms, they shut down,” Weaver said. She advised “making it real” and taking a problem-solving approach. She explained that 90% of workshop attendees recommended them to a friend. In addition to more women seeking out education, individual retirement accounts (IRAs) increased by 122%, and contributions to those accounts more than doubled. By understanding groups of individuals and tailoring engagement programs for them, Weaver said, real results are possible.