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30.06.2025 13 min read

The ultimate guide to employee engagement in retail (with practical tips from well-known brands!)

Learn how effective employee engagement strategies and solutions boost motivation, reduce turnover, and drive business success – with tips from leading retail brands.

A smiling bakery employee in a yellow sweater and apron holds a loaf of bread behind the counter, with various baked goods displayed.

The retail sector hasn’t had it easy in recent years. Between the pandemic, supply shortages, and a shortage of skilled workers, retailers have been facing challenges on every front.

As a result, many retailers are asking themselves: How can we meet sales targets? How can we ensure that our shelves will continue to be reliably stocked? How can we deliver better customer service than our competitors?

The answer lies - at least to a large extent - in solutions for staff management that boost engagement, satisfaction, and productivity.

What is employee engagement and why does it benefit retailers?

Employee engagement refers to employees’ emotional connection and commitment to their roles and tasks. This includes – among other things – a willingness to work hard for one’s employer, contribute to the company's success, and provide a high level of customer service.

Research from Gallup (and many more!) shows that engaged employees are more likely to deliver great customer service, helping retail businesses achieve lasting business success in a competitive market. Other benefits include:

  • Reduced absenteeism

  • Reduced employee turnover

  • Higher worker productivity

  • Fewer accidents and incidents

  • Fewer quality defects

  • Lower rate of theft shrinkage

  • Better customer service, improved customer experience, and higher customer loyalty

  • Higher sales and profitability

With a list of benefits that long, any retailer looking to maintain a successful business would be very wise to promote high employee engagement in store teams and beyond.

21% higher profitability with employee engagement, Gallup study.

Common challenges to employee engagement in the retail industry

While high employee engagement is a valuable asset in any industry, that's all the more true for retailers.

The retail industry brings unique challenges for employers and employees alike which make work more arduous for the individual and operationally challenging for the business.

🛒 Challenges facing retail businesses

  • E-commerce models reducing foot traffic and challenging brick and mortar operating model

  • Inflation, increasing cost pressures, and squeezed margins

  • High staff turnover rates (the UK retail sector saw over 30% voluntary churn in 2020-2021, for example) threatening operational stability

  • Supply chain disruption as a result of economic, geopolitical, and environmental turbulence

  • Shoplifting, organised crime, and employee theft risk – increased with cost of living pressures

  • Decreasing brand loyalty and changing consumer demands

  • Pressure to reduce environmental impacts

👩🏻‍💼 Challenges facing retail workers

  • Low average wages and limited benefits compounded by increasing rents during a cost of living crisis

  • Lack of job security compared to knowledge workers or other industries

  • Long and unpredictable hours with limited flexibility

  • Work that is often physically demanding and often monotonous

  • Extensive customer interaction incurring high emotional labour demands and incurring risk of harassment

Retail employee engagement statistics

The challenges facing retail employees aren't just theoretical – they're having a measurable impact. In recent Flip research, we surveyed frontline workers across various industries to dig into their employee engagement levels. Of all industries surveyed, retail employees showed the worst performance on a variety of engagement factors including:

  • Happiness factors: Lowest average score for 4 factors, including flexibility and compensation.

  • Well-being: 44% report good or excellent well-being, the lowest score across industries.​

  • Stress and burnout: 20% say they feel burned out every day or multiple times a week.​

  • Motivation: Lowest willingness to go the extra mile (55%)
compared with other industries (average 62%). ​

Add the increased pressure to perform as retailers themselves face a difficult operating environment, and you have huge threats to employee engagement – and, by extension, to your customer experience, sales, and profitability.

Infographic on retail industry stats: lowest average score for flexibility, 44% well-being, 20% high stress, 55% low extra mile willingness, 45% job satisfaction.

Understanding the needs of retail teams

To drive effective employee engagement and build a motivated workforce in the retail sector, it's essential to understand this state of play and the challenges driving it. But more importantly, we need to know what it is that retail workers need in order to be highly engaged.

Key needs for retail employees include:

  • Opportunities for growth and development: Retail employees want clear paths for career advancement and access to ongoing training. When retail companies invest in professional development, employees feel empowered and more committed to their roles.

  • A positive work environment: A supportive environment where employees feel respected and included is essential. Retail businesses that foster teamwork and open communication help employees feel valued and engaged.

  • Fair compensation and benefits: Competitive pay and comprehensive benefits are crucial for employee satisfaction and retention. When retail employees feel they are fairly compensated, they are more likely to stay with the company and deliver great customer service.

  • Work-life balance: Flexible scheduling and respect for personal time help employees manage the demands of retail jobs. Retail companies that prioritize work life balance see lower employee turnover and higher engagement.

Building a positive work environment: How to boost employee engagement in retail

The poor engagement statistics across retail workers demonstrate that for many retail teams, their needs simply aren't being met.

When analysing the reasons behind retail's last place position in our industry engagement rankings, some key themes emerged. Poor well-being, for example, was driven by understaffing, low pay, and a lack of recognition. Those with better well-being, by contrast, credited strong relationships with colleagues and excellent communication.

Identifying and addressing these needs enables retail businesses to implement employee engagement strategies that not only improve employee satisfaction and build a committed workforce but also drive the business performance needed to achieve long-term success in the retail sector.

Key strategies to improve employee engagement in retail

Improving the employee experience and building a positive work environment is multi-factorial – it takes multiple levers to build a workplace where employees feel supported, recognised, and motivated.

To give you some inspiration, here are some research-backed tactics that lay the groundwork for high job satisfaction and strong team dynamics.

Prioritise employee recognition and appreciation

Retail employees who feel recognised for their contributions and appreciated for who they are show considerably higher employee engagement markers than their disengaged peers:

Frontline employees feel more appreciated, leading to higher job satisfaction and retention.

Regular recognition boosts employee morale and motivates retail workers to excel. As such, making employees feel valued is a key driver of employee engagement and business success in the retail industry.

For a breakdown of how to achieve this, check out this article where we took a deep dive into employee recognition and appreciation.

Provide feedback and opportunities for career growth

When our engagement survey asked participants about career growth, just 45% of retail employees reported that there are opportunities to progress in their career at their current company. Only 37% reported that their employer gives them professional development opportunities.

Other Flip research into the generational skills gap revealed key issues with onboarding and upskilling, with one Gen Z retail worker quipping 'I feel like they just threw me to the wolves without proper training.'

When employees see opportunities for personal and professional development, their engagement and loyalty increase. McKinsey research into frontline employees' needs stressed the importance of job growth and learning opportunities in particular.

To increase employee engagement among retail workers, offer training programmes, coaching, and clear paths for career advancement.

Provide safe and comfortable working conditions

When we quizzed employees on their working conditions, we found a stark correlation with their job satisfaction. Among satisfied employees, 78% agreed their working conditions were safe and comfortable. By comparison, only 12% of dissatisfied employees agreed.

Exactly what 'safe and comfortable' looks like will vary with individual workplaces but are likely to include stringent health and safety standards, adequate breaks and comfort facilities, and clear policies around customer harassment.

Support work-life balance and employee well-being

While there are limits to the flexibility of an in-person shift job, efforts to give retail workers a better work-life balance pays dividends in terms of increasing satisfaction, improving motivation, and decreasing the risk of burnout.

Tactics here include respecting employee's off-hours and holiday days with a 'right to switch off', offering flexible scheduling and easy access to rotas, and making annual leave quick and easy to book.

Enable open communication

Poor communication harms engagement – not to mention worker efficiency, store operations, and customer satisfaction. Yet frontline workers who say their company's communication is effective are in the minority.

As such, it's little surprise that facilitating better internal communication emerged as a key engagement differentiator in our research. Employees who reported effective communication at their company were 8.2x more likely to be satisfied with their job and a whopping 12.9x more likely to report good or excellent well-being.

But one word to the wise when it comes to tactics here: Look beyond top-down channels when improving your communications strategy or selecting communications tools for retail teams.

Effective frontline internal communication strategies and solutions will enable both bottom-up employee feedback and peer-to-peer networking alongside top-down tactics.

Graph showing the correlation between effective communication and willingness to go the extra mile

Retail employee engagement solutions

With employee engagement such a high priority in the retail sector, many businesses consider technology solutions to facilitate their efforts.

These solutions offer retailers the opportunity to optimise store operations and deliver improvements to the employee experience reliably and at scale by...

  • Facilitating peer-to-peer communication both within stores and between branches (better still: on secure, company owned channels!)

  • Increasing identification with the business through reliably-delivered top-down communications

  • Offering opportunities to make worker voices heard with surveys, polls, and specific feedback channels

  • Embedding digital recognition and appreciation processes into company culture

  • Providing easy access to existing company resources, perks, and HR tools (such as a company wiki, annual leave tool, or digital discount cards)

Retail employee engagement solutions are no replacement for an effective employee engagement strategy. But when deployed effectively, they encourage employees to participate more fully and frequently, supercharging your engagement initiatives.

What the best retailers do for employee engagement

While you might want to build your own strategy from scratch, you don't have to reinvent the wheel to improve employee engagement in retail teams.

To give you some inspiration as to which solutions work and what concrete implementation looks like, here are some examples from some of the strongest brands in the industry.

Apple, REWE, and toom have all implemented practical retail employee engagement ideas to address common challenges. From training programmes and reward systems to innovative communication solutions and work-life balance initiatives, these companies define best practices in employee engagement and offer valuable insights for other companies looking to improve their own engagement strategies and building a motivated and engaged workforce.

How motivated Apple employees drive customer satisfaction

Often imitated, never matched; Companies across industries mimic Apple's strategies – and its success.

Beyond (or perhaps related to!) its roaring sales numbers, the visionary technology company is also a front-runner in employee engagement. Apple's retail stores are known for their extraordinary atmosphere, good-humored 'geniuses,' and expert advice.

Like any forward-thinking company, Apple Retail combines a variety of engagement solutions. These include:

  • Training and education: Apple is known for its extensive training programmes. The company provides ongoing learning opportunities that help employees better understand and develop the Apple brand and products, supporting employee growth and enhancing the overall employee experience.

  • Good salaries: Apple stores pay better than many other retail companies, recognising that financial compensation is essential to employee engagement and satisfactio – and as such, salary satisfaction is significantly higher than the retail industry average.

  • Rewarding success: Apple’s employee reward systems include competitive pay and stock options, ensuring that employees feel recognised for their contributions. help employees feel motivated and recognised.

  • Unique corporate culture: Apple - unlike almost all other companies of its size - is organised functionally rather than by business unit. As a result, employees from different disciplines work more closely together. This unique culture fosters communication, keeps employees motivated, and contributes to a positive employee experience. And according to reports from former employees, Apple stores have an exceptional atmosphere (involving quite a lot of clapping!)

Two employees smiling at a phone in a grocery store aisle.

How German retailer REWE fosters work-life balance

REWE Group, one of the leading food retailers in Germany, has developed a diverse range of initiatives to improve employee engagement.

For REWE, the primary focus is on work-life balance. These initiatives help increase overall employee engagement and avoid significant costs associated with high employee turnover.

  • Flexible working models and work/life balance: REWE relies on flexible working models tailored to its employees’ individual needs. The chance to start with part-time training and the possibility of a secure part-time work during parental leave both make REWE an attractive employer. And even more flexible: Those who need a more extended break can take up to six months off for a sabbatical - without giving any reason.

  • Good pay: Complementing its flexible working policies with fair remuneration for employees, REWE pays according to the collective wage agreement, and offers additional payments and a company pension scheme to give its employees a secure financial future.

  • Health and wellness offers: To further protect employee well-being, REWE offers a range of health and wellness offers. These include financial support for gym memberships as well as a dedicated REWE fitness programme.

  • Frontline-first employee experience platform: With Flip, REWE has introduced an employee app specifically designed with frontline workers – retailers in particular – in mind. With one-on-one and group chats it strengthens internal communication between colleagues, while dedicated Channels provide easy access to colleagues in other stores and HQ. Even better, the app empowers employees to give feedback and suggestions directly to REWE head office through surveys and digital forms, giving them a real opportunity to shape the business they work for.

Find out more
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Store employee in red shirt showing a smartphone in a paint aisle.

How DIY store toom has built a repeatable employee engagement engine

Leading German DIY chain toom embraces a wide variety of measures to promote employee engagement across its retail stores, recognising that a demanding retail environment with aggressive sales targets can be a source of significant stress and demotivation for employees.

  • Flexible working models and individual support: toom supports employees through various phases of their lives with daycare facilities, sabbaticals, time off to care for family members, and a tutoring programme for employees' children. As such, it was the first DIY store to be awarded the 'Work and family' audit certificate in Germany, recognising its efforts to support staff's work-life balance.

  • Further education and wellness schemes: Toom makes upskilling a high priority with accessible training schemes, while supporting employees' health and wellness with cycle-to-work programmes, cancer screenings, and free flu vaccines.

  • Frontline-first employee experience platform: The DIY giant has also rolled out Flip's frontline-first employee app to over 18,000 employees, empowering them with friction-free access to important information, streamlined store operations, networking amongst colleagues, and easy shift swaps for control over their schedules. Employees receive target group-specific information to ensure work-life balance – keeping them in the know without bombarding them with unnecessary updates.

Find out more

What does employee engagement look like at the DIY store toom?

toom, a leading DIY chain in Germany, also relies on a variety of measures to promote employee engagement.

  • Flexible working models and individual support: toom supports employees through various phases of their lives. It is the first DIY store awarded the 'work and family' berufundfamilie audit certificate. This includes daycare facilities, opportunities for time off to care for family members and sabbaticals, and a tutoring programme for employees' children.

  • Training and further education: the further education and training of employees is a high priority at toom. In addition, toom offers its employees participation in the cycle-to-work programme and implements health management measures. These include cancer screening, flu vaccinations, and the Fit.net programme.

  • Employee app: to promote internal networking and the exchange of information, toom has also introduced the Flip employee app, which can be accessed by all 18,000 employees on mobile devices or desktops. Employees receive target group-specific information, so they're always in the know without being overloaded with unnecessary updates. In the medium term, the app should simplify and handle various HR topics such as duty scheduling or time recording.

Checklist: Three steps for better employee engagement today

While improving employee engagement is a game-changer, a well-thought-out strategy and robust implementation don't happen overnight.

That said, it's never too late or too early to get started. Three steps you can take today include:

1. Run an employee engagement pulse poll

It's hard to increase employee engagement if you're not sure what baseline you're working from. A four question employee engagement pulse survey is quick and easy to build and provides an invaluable tool for assessing employees' morale, motivation, and net promoter score. Find our suggested questions here.

2. Address internal communication

It emerged as one of the key differentiators between engaged and disengaged employees in our research for good reason. Though you can't launch a strategy or solution today, you can familiarise yourself with our guide to improving internal communication and use it to identify areas for improvement. Do your updates reliably reach all employees? Does your peer-to-peer communication infrastructure need work? Can all employees contribute feedback?

3. Show recognition and appreciation

With employees who feel valued more likely to show commitment, there's no time like the present to make a worker feel that they are appreciated and their contributions are recognised. Thank a colleague or an employee for some great work they did for you recently – in a public channel if you can. Once you've hit send, we recommend developing a formal appreciation and recognition programme to shine a light on outstanding performance and ensure employees feel appreciated. For inspiration, check out Virgin Media O2's Shout programme here.

Conclusion: Retail employee engagement calls for active management and modern solutions

In a dynamic, challenging, and increasingly digitalised retail landscape, high employee engagement is a do-or-die, providing reliable boosts to customer satisfaction, sales, and growth.

While providing a safe working environment, recognition and appreciation, and better communication are all backed by the research, strategy inspiration can also be taken from industry leaders.

Whether it's training programmes, flexible work models, or monetary performance incentives, leaders like Apple, REWE, and toom use a variety of strategies to create an engaged workforce and enhance the overall employee experience.

While delivering these strategies is not impossible without technology, employee experience platforms and solutions provide the infrastructure required to improve employee engagement at scale – especially for enterprise retailers and franchise-model businesses.

Person using a smartphone app; logos of Bosch, GLS, McDonalds, Edeka, Porsche.

Flip for retail organisations: A one-stop-shop for the slickest store teams

By streamlining shift planning, speeding up information flow, and automating repetitive processes, Flip optimises operations and helps the face of your business put their best foot forward.

Get feedback from the floor, direct merchandising remotely from HQ, or reliably deliver top down comms – all while your store teams access real-time information, problem-solve in secure peer-to-peer chats, and access product and stock information on demand.

Whether they're on the floor, out the back, or at the warehouse, put everything your employees need at their fingertips – and watch customer satisfaction soar.

Explore Flip for retailers here, or book your personalised tour now.

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