Financial Wellbeing Intervention
Empowering Walmart’s Workers
By Dustin DiTommaso, SVP Behavior Change Design at Mad*Pow, Edited by Lizzie Inglis
Financial wellbeing is a topic that’s been gaining momentum and attention in the U.S. 70% of U.S. workers report that financial stress is their most common source of stress, and 48% report feeling uneasy and financially insecure. When unexpected expenses occur or emergencies strike, few families have sufficient resources to fall back on, so helping employees build their capacity to effectively budget and manage their money is more than a novel benefit. These tools, benefits, services, and cultural changes represent a forward-thinking competitive advantage.
Our partnership with Walmart represents Mad*Pow’s continued pursuit of “doing good” by effectively serving the needs of our clients and the intended beneficiaries of the solutions we create together.
Mad*Pow partnered with Walmart to analyze the current state of employee financial wellbeing, design and implement targeted interventions to empower employees, and evaluate the impact of our solutions.
As with any change initiative, our teams needed to start with an understanding of the following: The impact we hoped to achieve; how we might measure that change; the individual, interpersonal, and environmental factors that might contribute positively or negatively to outcomes; and any resources currently in place to support change.
Our first step was to learn about the client’s specific needs in a collaborative workshop with corporate HR and associate wellbeing staff, as well as internal and external employee benefits providers. Together, we analyzed the benefits available to Walmart employees and the current organizational body of knowledge regarding employee wages. We also worked to shape our definition of financial wellbeing. Leaning heavily on work performed by the Consumer Financial Protection Bureau, we created our own definition of Financial Wellbeing (FWB) and how to measure it subjectively and objectively. Ultimately, we defined FWB as “a state of being where individuals can successfully manage their current and ongoing financial obligations, have the capacity to absorb an unexpected expense, and feel optimistic and in-control of their financial status.” We also settled on three broad categories of financial behaviors to focus on: everyday spending and savings, saving for the future (mid- to long-term), and managing significant negative financial events.
After the workshop, our team performed a literature review and interviewed subject matter experts. Then, we connected directly with the intended beneficiaries of our solution – hourly and salaried employees.
To gather rich data from employees, we conducted 150 brief employee interviews at multiple Walmart locations across the U.S. to gather employee perceptions and understand the realities of their financial behaviors and status. In addition, we implemented a survey across the organization in order to pinpoint themes and determinants uncovered during our other research efforts along the way.
Our thematic analysis suggested that while virtually every employee was striving for financial stability, not everyone had the capabilities and opportunities to achieve this goal. The factors that helped or hindered individual financial wellbeing varied, but common patterns emerged.
Financial stress and instability can occur regardless of income. Of course, it’s more common at lower income levels, but individual behavioral patterns, such as managing cash flow and debt, decreasing expenses, and increasing long- and short-term savings, affect financial stress levels across income levels. These behaviors significantly affect employees’ ability to make ends meet, feel secure, and avoid feeling overwhelmed by financial stressors.
People don’t know where to turn. Employees who were struggling didn’t have a good sense of what would most help their situations (e.g., paying down debt vs. building savings). They were also generally at a loss on where to turn in the face of an unexpected financial crisis.
People are better at saving for the long term. By and large, employees were planning well for retirement via enrollment in Walmart’s 401(k) plan, immediately available to associates on their first day of work, but they had serious concerns about meeting more immediate financial needs such as rent, debt, and other incoming bills.
Timing is everything. Financial decisions and allocation of money depends heavily on the timing of financial events. Paydays, bill due dates, holidays, milestone life events, and unexpected expenses can determine which needs or wants are prioritized over others, or whether a bill can be paid on time or at all.
Paycheck volatility is a major culprit. Our most important insight was that about one-third of our research participants face consistent but irregular swings (dips and peaks) in their take-home pay. This made it hard to predict what they would earn, and even harder to plan or budget effectively. The ups and downs of the income roller coaster also sent employees’ sense of financial security and wellbeing for a loop.
In addition to our thematic analysis, we coded our data, looking for motivational processes. These motivational processes had a strong impact on daily spending and short- and longterm savings, but would require high levels of engagement with an intervention over time in order to be effective. External opportunity factors had the biggest impact on financial behaviors and wellbeing. These factors included earned income and wages, available shift hours, and timing of incoming/outgoing cashflow, along with social factors such as caring for extended family members, spouse/household spending habits, and shared financial decision making. The volatility of these external factors made both incoming wages and outgoing expenses hard to predict and control, increasing difficulty for employees who wanted to improve their financial status. Upon concluding this analysis, we felt that targeting external opportunity factors would bring the biggest benefit to employees and their families.
Employee Benefits Audit
Our team performed an audit of employee benefits available to Walmart workers as the final step of our diagnosis. We mapped them to the financial behaviors and underlying determinants they address, then assessed their potential value in terms of employee uptake, usage, and outcomes compared to organizational cost. We looked for gaps, overlaps, and misses with the existing mix, seeking to shed those not fit for purpose, more prominently feature those with value, and add new benefits where gaps existed.
Designing the Intervention
With research done and findings drawn, we were ready to tackle the design phase. To address the modifiable factors and insights that we had uncovered, our team settled on a mix of layered intervention components.
Gravy: At the top level, we created a financial wellbeing hub, called “Gravy,” that presented all employee financial benefits in one easy-tonavigate place. Benefits were organized into three buckets: Everyday spending and savings, future savings, and significant events. “Gravy” also included custom content such as short educational articles and tips, and recommended actions for employees to try in order to improve their financial literacy and skills. Employees could access the content via a mobile website or through email digests.
Call center: For more urgent needs, we worked with Walmart to implement a call center to counsel employees and direct them to resources and third-party partners in times of financial need. We developed a series of branched-logic call-center scripts and FAQs to provide emotional as well as practical support. The Walmart team procured partners that could more effectively navigate and assist with dramatic financial events. These services were offered at a discounted, subsidized, or limited pro-bono rate for employees.
Payroll services: The final piece of the intervention was aimed at paycheck volatility and involved partnering directly with existing services rather than building new solutions. Walmart integrated their payroll service with Even and PayActiv, and made these benefits available to all employees. These two services combined to “even out” income over time by establishing the average earnings between paychecks and automatically advancing or withholding earnings to stabilize pay. The resulting predictability made financial planning and budgeting easier. Additionally, employees could access earned but unpaid wages between paydays to reduce the risk of costly overdrafts, bounced or missed payments, or payday loans. The services also provided goal-setting, planning, and feedback techniques.
Implementation and Evaluation
Our intervention design was set; now we had to implement it. Rolling out and scaling interventions across 4,500 locations required careful logistical planning, and we relied upon a range of methods to evaluate the following aspects of the intervention. Fit: Desirability, acceptance, usability, and usefulness of the intervention as determined by the people who interact with it. Feasibility: Projected resource costs, or the people and funds needed for full-scale implementation and maintenance. Effects: Does the intervention result in behavior change? Does it deliver desired outcomes as intended? Are there any unintended consequences?
At Mad*Pow, we believe in testing, testing, and testing some more. We began our initial concept evaluation by translating the intervention strategy into multiple visualized concept approaches describing our intended outcomes (creating value for employees). We designed variations on how the intervention as a whole might work to achieve those outcomes, and we identified different functional, aesthetic, and tonal directions we might take. We performed concept testing with 12 employees through moderated testing, and with 80 employees through unmoderated testing.
From Concept to Pilot Trial
Our goal as a design partner is to deliver meaningful impact through the interventions we help deploy. In order to iterate, refine, and scale our financial wellbeing intervention in a relatively nimble fashion, we designed a stepped wedge trial. In our stepped wedge design, we made the intervention available to different company locations over time. Each “step” of the wedge represented a three-month period wherein the intervention was rolled out to a cluster of pre-selected locations. We then rapidly adapted the intervention based on findings before the next step in the wedge occurred. In total, we completed three trial steps across 16 locations before completing our engagement. Afterwards, Walmart continued the process of experimentation and scaling throughout the organization. This approach allowed us to expand reach over time, while evaluating program efficacy and optimizing the components associated with uptake and engagement.
The primary outcomes for program efficacy were employees’ perceived financial wellbeing as measured by self-report questionnaire, satisfaction with employer and available benefits as measured by self-report questionnaire, and activation of benefits measured through the FWB hub.
We used key findings to refine our intervention. Environmental restructuring is critical to uptake and engagement. Physical and social elements together had bigger effects than digital promotion (intranet banner ads, email campaigns) alone. On-location environmental graphics (posters, table-tents, flyers) were more effective than digital-only promotions. Social influences such as supportive shift-managers (who announced the new benefits) and early adopters (employee champions) on location had the largest effects on uptake and engagement. One size-fits-all messaging, while efficient and affordable to produce, is not likely to be as effective as tailoring graphics, messaging and tone to specific location characteristics. For example, follow-up feedback suggested that perceived relevance, trust-worthiness, and value to associates differed between urban and suburban areas, and between surrounding Walmart locations where employees live. Engagement with educational content was low. Repeat engagement with educational material (articles and tips) was low and dropped off significantly once individuals activated mobile apps for paycheck volatility.
At the time of the writing of this case study, the intervention has been accessed by over 300,000 Walmart associates. About 200,000 of those people have enabled the income smoothing feature through Even. Additionally, nearly half of participants now access their earned but unpaid wages through PayActiv on a monthly basis. Together, these tools have produced a reduction in employee payday loans and overdraft and late fees, and they enable associates to turn around harmful habits and begin to gain traction in savings. It is clear that the negative consequences of poor financial wellbeing affect the fully employed in addition to underemployed and unemployed individuals and families. Organizations seeking to provide benefits to support financial wellbeing of their employees should begin by truly understanding the root of the obstacles their employees are facing. We believe that by combining methods and tools from behavioral science and design, we can better pinpoint those obstacles to design meaningful solutions and prevent or limit the burden on people’s lives. In addition, behavioral research methods allow us to set benchmarks on the behaviors and outcomes that matter most, and systematically improve our impact over time.