How to Increase Sales by 20% with Employee Engagement

Have you ever walked into a store or business that treated your presence as a nuisance? Or perhaps, a sales associate helped you but gave the absolute minimum effort required.

How did that cold "give me your money and go" transaction make you feel? In one word: unimportant. And probably like you're not valued as a person, let alone as a customer.

Let me guess—you never gave this business your money again.

We don't blame you, it's a normal reaction.

When faced with a dizzying array of options for the same product, why would consumers give their hard-earned money to a business with aloof (or even grouchy) employees?

Modern consumers expect top-notch service

Consumers would rather give their business to companies that provide friendly and personalized service. Businesses that ultimately value them as people, not merely dollar signs walking through the door.

If you provide superior service, clients are usually willing to pay a couple of extra dollars for the same product. Think about why Starbucks can "get away" with charging 6$ for a regular cup of coffee.

What does this tell us? Happy employees drive long-term customer satisfaction and loyalty. And in extension, happy employees also drive sales and, ultimately, profits for businesses.

Happy Employees: Drive Sales

Now—this is not to say that employee happiness is the only factor that drives sales, but it is one of the most significant.

Employees are the engine of your business—the crew of your ship.

No matter how powerful or great your vessel is, it won't get very far unless a skilled and motivated team is actively driving it forward with focus, energy, and determination.

In short, it's a simple and intuitive notion; happy employees lead to happy and satisfied customers. And satisfied customers buy more products or services from your business. This is a fair assumption we can all make based on our own experiences.

Indeed, these claims are not only supported by a gut feeling or intuition—but also official research and data.

Evidence from highly successful companies, official HR reports, and studies unequivocally show that underlying all high-profit companies is one common denominator: happy and engaged employees.

Can the Return on Investment (ROI) be Quantified?—Yes!

Investing in employee engagement may seem like a gamble to some; data-driven executives might ask, "What will my return on investment be?" or "how much increase profitability can I expect?"

We can quickly answer this question with a few popular research studies and examples.

First, let's look to the gold-standard of customer loyalty and happiness—Starbucks, as a prime example of this phenomenon.

“21% Increase in Profitability”

Starbucks' front-line employees, otherwise known as baristas or "partners" in the "Starbuckese" language, are known to be some of the most loyal and satisfied employees in the food and beverage industry.

As you probably know, Starbucks boasts a cult-like following from its customers. In sum, happy employees play a pivotal role in the overall success of the Starbucks empire.

Second, we can look at the findings from hundreds of research studies, otherwise known as a meta-analysis, conducted by Gallup titled "How Employee Engagement Drives Growth."

This analysis of hundreds of studies showed organizations that scored the highest on employee engagement showed 21% higher levels of overall profitability.

Further validating these findings with a different type of research method, we can look at a fascinating longitudinal study by Harvard Business Professor James Heskett. Heskett dove deep into the topic of employee engagement by tracking 200 companies over the course of 11 years.

He observed the corporate culture at each company and examined its connection to long-term economic performance. AKA sales and profits. He (unsurprisingly) found that companies boasting a robust corporate culture that encouraged leadership initiatives and appreciation for their employees, customers, and partners grew 682% in revenue over the course of the 11-year study.

Lastly, an often-cited study of car rental sales reps by Yale University researchers revealed engaged employees successfully upsell to clients at a higher rate, resulting in happier and more satisfied customers. Also ultimately resulting in significantly higher sales and profits for engaged teams compared to disengaged teams.

Making Employee Engagement a Strategic Priority

There shouldn’t be any doubt at this point: Investing in your employees is no longer optional for modern businesses.

For long-term employee engagement to flourish, it must be made a strategic priority at every level of an organization.

Giving spontaneous praise and recognition is an excellent start. But building a vibrant and engaged culture cannot be done haphazardly or on short-term strategies. Cultivating long-term employee happiness—which yields tangible results—takes concrete planning and execution.

For example, if you are surveying employees on their happiness and satisfaction and conducting 1:1 meetings regularly, these efforts are a great start; but they are ultimately fruitless unless your organization is taking action with the insights gathered and building towards a long-term target or goal.

When an organization fails to translate employee feedback into tangible improvements, employees will be likely to develop a negative attitude towards surveys and 1:1 meetings and disengage from them altogether. So think about if these efforts are improving the organizational status quo in your company? Or are they just done as a formality?

Final Thoughts

Full-time workers are expected to dedicate a significant amount of time to their employers—at the very minimum, 40-hours per week.

On a high level, skilled and educated modern workers expect more than just a paycheck to be the ROI of that significant time investment. They want a place of work that is challenging, dynamic, social, and inspiring. Somewhere they can fit in and learn and grow both personally and professionally.

On a day-to-day level, modern workers also want to be appreciated and recognized for what they bring to the table. Not only in terms of their hard skills but their soft skills as well.

Only when employee engagement becomes a priority at all levels of a business can an engagement plan become truly instrumental in driving long-term sales and profits.