Hiring Wisdom: Give New Employees A Raise Their First Day

Article main image
Jun 13, 2016

I just read an article about a car lube center that used a stamp program to encourage repeat business. At first, they gave all new customers a card with eight places to put a stamp for each service performed. Once eight stamps were collected, the ninth service would be free. After the trial period, they found that about 19% of their customers actually collected on the free service.

Then they changed to a card with 10 places for stamps and an 11th service free. While this would seem counterintuitive, the redemption rate actually went up to 35% because they gave each new customer two complimentary stamps on their first visit.

One way to apply this to your employee awards and recognition programs would be to give two prizes or a bigger prize to the first person who meets a goal. Another would be to give a new hire a small raise on their first day of work. (“Joe, I know we agreed to $9.50 an hour, but I’m so sure you’re going to be an outstanding team member that I’m going to start you at $9.75.”)