In times of Great Reshuffle, when people are laid off due to economic headwinds and technology disruptions, and companies scramble to find talent subsequently, employee retention and engagement no longer depend on routine appraisals and measly pay hikes. Instead, a robust reward and recognition culture has become critical to propel today’s workforce to new heights as they seek value and relevance in all they do.
Research by Gallup shows employees who receive recognition are 20 times as likely to be engaged as employees who receive poor recognition. This not only transforms work and workplace cultures but significantly boosts productivity and profitability.
Although employee rewards and retention models have undergone a tectonic shift in recent years, an Indian couple working at Microsoft in the US realised its criticality nearly a decade ago. When Sourabh Deorah was a software engineer at MS, he noticed a remarkably low attrition rate across the company’s U.S. offices. The reason: Employees there felt valued and supported, which was not always the case with other tech giants. Sourabh and his wife, Smiti Bhatt Deorah (also a software engineer at MS), were further impressed by the perks and privileges offered by the company.
“Replacement of a single employee costs six to 11 months of the person’s CTC,” Sourabh said, emphasising on the importance of retaining employees. Hence, to introduce a similar corporate culture in India, they launched Advantage Club in 2016.
The B2B startup specialising in employee rewards and retention is headquartered in San Francisco, but its founders initially targeted small and medium businesses in India.
“We started with the Indian market as we believed that employees in India were equally smart and arguably worked even harder than their counterparts in other geographies,” said Sourabh. “So, we wanted to ensure that businesses back home would recognise, acknowledge and reward employees for their achievements and milestones.”
Using AI, Advantage Club has adopted a differentiated approach towards reward and recognition, simplifying processes and automating several functions. It currently offers a host of critical solutions to help incentivise employees. These include instant recognition of employee achievements, perks and rewards (also features NFT gifts) from renowned brands, access to wellness & fitness programmes, personalised health benefits (FlexBen), tax advisory and more. In addition, it has introduced a smooth onboarding system for new hires, connects employees through communities and helps companies create and manage fun zones and hobby clubs to foster camaraderie and collaboration.
Any organisation looking for a cost effective employee engagement solution can partner with Advantage Club to run and manage its rewards-and-recognition initiatives and drive employee engagement digitally. The platform has 1K+ corporate customers across 100 countries and a wide range of industries such as finance, hospitality, pharma, manufacturing and automobile.
Advantage Club has also tied up with more than 10K brands to provide easy access to great benefits, meaningful rewards and special deals and discounts.
Globally, the employee engagement platform claims to have earned $6.6 Mn in revenue in FY23 and eyes 2x revenue growth in the current financial year. It also raised $7 Mn from a clutch of investors such as Y Combinator, Axilor Ventures and GrowX Ventures.
How Advantage Club Scripted A Tech-Powered Growth Narrative Despite Covid Chaos
As Sourabh mentioned, Advantage Club initially collaborated with Indian SMEs to set up reward and recognition programmes aligned with global standards. It provided corporate discounts on consumer brands and exclusive offers on wellness memberships on a par with what was offered in the West. Its initial success fuelled the founders’ ambition, and soon, they set their sights on larger companies with 200-500 employees. But at the time, the platform needed the scale and technical capabilities required to meet the complex demands of large enterprises.
The Deorahs took the technology leap to enable ‘smart’ operations and unbiased reward and recognition decisions. Moreover, the investment required for Advantage Club is nearly one-fifth of the cost compared to direct cash incentives, claimed Sourabh. Yet it delivers a comparable impact of employee morale and retention.
Now, the platform’s tech stack leverages AI/ML to generate algorithms that help companies track high-performing teams and individuals, guide them on whom to recognise and zero in on the most suitable rewards and benefits.
Moreover, the platform has automated milestones, notifications and reward updates so that companies can celebrate employee success promptly. For instance, when an employee hits a milestone (birthday, work anniversary and more) or achieves professional goals (say, when one closes her 100th sales deal), the automated system swiftly sends customised messages, instantly notifies it on the company’s digital platform and enables access to available rewards. Employees can easily claim these rewards/deals by logging in and inputting their company credentials.
Its AI offerings can be leveraged further to personalise benefits and rewards based on employee interests, preferences and past usage. This will enhance the redemption experience every time. The platform also offers people analytics to optimise performance evaluation, strengthen employee engagement and reduce turnover. Besides, corporate houses can measure how the reward and recognition programme has impacted employee engagement and calculate their ROI on the initiative.
The AI adoption was rewarding, said Sourabh. It gained traction and grew the customer base while its YoY revenue increased fivefold between 2022 and 2024, he added.
According to the CEO, the upward trajectory signified the market demand for its solutions and helped the startup hit product-market fit in two years since its inception in 2016.
All went well until the Covid strike, the platform was primarily catering to Indian companies at the time, and the gloomy scenario at home affected its growth prospects.
That’s when it decided to make the leap from being an India-focussed platform to a global one. This was no easy feat and it had to counter many hurdles in a very compressed timeframe.
‘We had to serve a diverse, global customer base, adapt to different organisational cultures and meet varied engagement needs across the globe,” said Sourabh.
However, there was a silver lining amid the Covid-induced chaos. Globally, several governments came up with employee welfare schemes during the pandemic, and many overseas companies focussed on employees’ mental health and engagement in a primarily remote work environment. The founders saw a global growth opportunity there and decided to turn the Covid adversity on its head. Advantage Club entered many countries during this period, including the UAE (Dubai) and Singapore among others.
“As organisations with a depleted workforce [due to the health crisis and downsizing] had to engage with their existing workforce meaningfully to retain them, the search for holistic reward and recognition programmes intensified. The disruptive business climate has driven the demand for services like ours as companies looked for cost-effective ways to foster a positive work environment,” said Sourabh.
Aware that remote-only workplaces would require top-notch data security for corporate houses and their employees, Advantage Club pro-active obtained the GDPR compliance certification for EU enterprises.
Overall, cutting-edge techvantages played an enabling role as the reward and recognition platform went above and beyond to help organisations showcase their core organisational principles and reach their objectives through employee engagement at a time when their employees sought compelling value propositions beyond pay cheques.
Creating A Seamless Reward & Recognition Journey For Corporate Clientele
Designing and implementing an in-house reward and recognition programme from scratch could be difficult for companies of all sizes as these operations are complex and massive. For example, rewards and recognition metrics must be fair, transparent and inclusive to ensure company-wide coverage and maximum incentivisation. But more often than not, parameters are designed arbitrarily without employee feedback and management biases creep in the process. The solution is continuously improved with new use cases based on the changing needs of new and existing customers, claimed Sourabh.
Additionally, the three R’s of the ecosystem – real-time recognition (of employee milestones and achievements), revelation (notification) of the same and redemption (timely perks, rewards and benefits) – may lead to cumbersome spreadsheet struggles, sucking in valuable resources and working hours.
Of course, reward and recognition software programmes are available in the market to eliminate these pitfalls. But these are pretty expensive, lack significant impact and rarely provide the comprehensive coverage most companies look for, said Sourabh.
Advantage Club has addressed these pain points by incorporating an AI engine specifically designed to drive redemption rates, based on multiple factors such as their personal interests, past usage, as well as any preferences stipulated by the employer.
Besides, the platform’s solutions can seamlessly integrate with a corporate customer’s existing system and one can access those via a single sign-in. Popular communication tools such as Slack, WhatsApp, Microsoft Teams, Outlook, and Gmail can also be used for a cohesive experience.
The platform offers a while-label user interface (UI) that mirrors each company’s look and feel by incorporating logos, corporate colours and style elements. The unified look helps establish corporate consistency throughout the reward and recognition journey. It also keeps its clientele updated about new features and supplementary training sessions, explained step by step.
Its access to 10K+ local and global brands is another key feature that takes the pain out of procurement and adds value to all reward/benefit programmes. It offers a separate catalogue for international brands to ensure easy access and quick delivery. NFT-based rewards, especially recognition badges and digital memorabilia, have been available on the platform since 2023. Plus, there is FlexBen, wherein companies allow their employees to choose the benefits that suit them best rather than handing out generic offerings.
“With Advantage Club’s FlexBen, an employee can choose from various wellness programmes, not just a specific gym membership. This also helps the global corporate allocate their budgets smartly and meaningfully on employee benefits,” explained Sourabh.
Then there are Hobby Clubs enabling connections between individuals who share common interests. The Fun Zone is a gaming space with leaderboards to drive employee engagement further. Finally, the Classifieds section serves as an internal marketplace, allowing employees to buy, sell and rent products within an organisation.
The startup claims that it does not charge any ‘breakage’ or amount charged for unredeemed gift cards and its interests are focussed on ensuring high redemption rates for its customers. Instead, it earns revenue from subscription fees from corporate customers, while brands pay a commission on every reward claimed by an employee. Sourabh says brands have access to more than 4 Mn employees and large corporate budgets, making things profitworthy for all.
“This prudent approach steers us away from the ‘growth at all costs’ model, which has tripped up many startups. We believe in ‘good growth’, which has positioned us well during these challenging times, and we continue to see organisations recognizing the value we offer,” he said.
Will Reward & Recognition Align With The Future Of Work, Combat Workplace Challenges?
Ambitious to the core, Advantage Club aims to advance technologically, expand partnerships and broaden its geographical reach. It will double down on operations in India, the US, India, APAC and the MENA region. To achieve these goals, the founders have established physical teams in each market to maintain a strong on ground presence.
However, Advantage Club is not alone in this space. Among its Indian peers are the likes of HiFives, BI Worldwide, Gratifi and more, all looking for growth, as the market for recognising and rewarding employee contributions took a severe hit during Covid-19 and the subsequent economic downturn. In fact, rewards and recognition is a well-calculated corporate strategy to build an attractive workplace culture that keeps employees invested and ultimately boosts a company’s performance and profitability.
But would the digital-age corporate culture revive this trend, given the rise of smart industry automation and intuitive technology, which could rapidly deplete the human workforce? A recent study revealed that the percentage of employees witnessing work disruption due to automation rose from 44% to 71% in just two years. On the other hand, 77% of global employers found it challenging to fill new-age roles compared to 75% in 2022, per a Mercer survey.
Essentially, work is at a crossroads, and the traditional concept of rewards and recognition must evolve based on how work is defined and how value is perceived in an environment where nearly half of the skills are estimated to get obsolete in two years or so. Given these talent challenges and unemployment variations, about 75% of global companies and around 45% in Asia focus more on non-financial reward and recognition factors.
Sourabh, too, thinks navigating the culture of reinvention is imperative as the tech transformation continues to grow. “The current trend, where employees seek more than just financial compensation, is expected to intensify. Hence, companies will have to create a robust employee engagement strategy to attract top talent,” he said.
The CEO observed that coming generations will prioritise the overall job experience over salary, as they are open to leaving a job without a guaranteed replacement. Additionally, they will seek positions that offer substantial personal growth, a balanced work-life dynamic and a sense of purpose beyond monetary rewards. This shift reflects a growing emphasis on holistic job satisfaction and fulfilment among employees, transcending traditional remuneration-based motivations.
Meanwhile, the global market for employee recognition and reward systems is estimated to reach $65.3 Bn by 2032 from $15.8 Bn in 2022, growing at a CAGR of 15.6%. This data indicates a steady rise in tech-driven platforms ushering in inclusive products and services to help businesses recognise, value and reward their employees in a whole new way.
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