How to Set Up a Mystery Shopping Program

How to Set Up a Mystery Shopping Program


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Every customer evaluates his or her experience buying a product or service. A tool used to measure the quality of that experience is mystery shopping. Hired as independent contractors, mystery shoppers are “posers” operating in stealth-like fashion to assess your business operations. They are charged with specific tasks such as taking photographs, purchasing a product or service, returning a product, registering complaints, asking questions of sales reps, and behaving in other ways.

Mystery shopping can be applied in any industry, although the more common venues are retail stores, restaurants, banks, hotels, car dealerships, and healthcare facilities. “But any company that has a customer can benefit from having a mystery shopping program,” says Christopher Warzynski, vice president of Beyond Hello, a mystery shopping company in Madison, Wisconsin with a database of over 400,000 shoppers in North America and Europe.

How to Set Up a Mystery Shopping Program: Why Hire a Mystery Shopper?

Mystery shoppers provide objective quantitative and qualitative feedback about their customer experience and conditions. This feedback can help business owners find out if their products, stock, pricing, and placement are appealing to customers; measure the training and performance of frontline employees; learn if competitors do a better job at sales, service, marketing, and operations; identify if employees are following company procedures or compliance practices; and, increase focus on service and selling to help convert browsers to buyers, Warzynski explains.

In this economic environment, you can’t afford to lose even one customer. “A lot of businesses are not able to grow by expanding. So they have to grow by building market share. You do that through winning customers,” says Elaine Buxton, president of Raleigh, North Carolina-based Confero, a mystery shopping and customer satisfaction service provider for automotive, banking, restaurant and real estate businesses. “You can’t compete on price forever,” adds Buxton, whose database exceeds 140,000 shoppers in North America and Japan.

A mystery shopping program can be set up within two months with cost ranging from $50 to $500 per shopper visit. One source for finding a certified company is the Mystery Shopping Providers Association MSPA, which has 275 members worldwide. MSPA estimates about 1.5 million mystery shoppers operate in the US. It is not uncommon for a mystery shopper to work for five or more providers at a time in any given month.

“A mystery shopping program in and of itself does not change behaviors,” says Warzynski. “It is how you apply the findings and data, which should transfer from the provider to top management down to the employees who interface directly with customers day-to-day.”

He points out that a mystery shopping program shouldn’t be a one-shot deal. Unless your primary goal is to measure a particular sales promotion. Whether it is monthly, quarterly, or annually, says Warzynski, consider making mystery shopping an ongoing part of your overall company initiatives to develop real awareness of customer service, reinforce your frontline sales, and improve company profits.

Don’t confuse mystery shopping with customer satisfaction services. “A mystery shopping program measures are we doing things right according to company standards and customer satisfaction measures, and are we doing things right according to customer expectations,” Warzynski explains.

Customer satisfaction is after the fact; a customer who visited your location is given a survey and asked to recall details. “They are telling you their feelings about a particular experience,” says Buxton. “A mystery shopper is told in advance I need you to look for these 25 things and to report back on these conditions.”

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How to Set Up a Mystery Shopping Program: Evaluating the Program Provider

You want to select a mystery shopping provider that will develop a program that satisfies your company’s needs. Identify and interview a minimum of three providers. Ask for references for current and past clients. Your selection of a mystery shopping company should be based on pricing, quality, capabilities, and commitment.

In general, you want a company with experience in conducting mystery shopping in your industry and your type of business. Ask questions that will determine the company’s capacity to handle administrative details, says Beyond Hello President Gary Godding. What is the size and profile of the shopper databases? Can they cover your region? Do they have enough shoppers so they aren’t sending the same people over and over again?

Make sure shopper profiles match your target demographic and various requirements. For example, with banking you want to send into the branch someone who already has an account with that institution, says Buxton. “That requires a specific shopper versus sending someone into a restaurant to order a meal.”

Beyond Hello’s secret shopper profiles consist of relevant demographic information, everything from clothing sizes to bilingual abilities. Godding suggests inquiring about how the provider screens its mystery shoppers. Also, how are shoppers to be educated on your products and services?

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How to Set Up a Mystery Shopping Program: Designing the Program

Before rolling out a mystery shopping program, you need to set some clear expectations. What are you looking for? “It usually starts off with some kind of challenge your company is facing,” says Ron Welty, owner of ItelliShop, a market research and mystery shopping company in Perrysburg, Ohio, with a database of 400,000 shoppers.
For example, there might be a rash of customer complaints or a drop in companywide sales, says Welty. He cautions, “the purpose of this tool is not be used as a gotcha. It is effective as a positive employee recognition and training tool.”

“You have to identify every single touch point with your customer and what that experience is supposed to look like,” says Welty. You may want to find out when a customer approaches the front door is the store clean and tidy? Are they greeted quickly in a friendly and sincere way? Are they automatically offered assistance or do they have to ask for help? Are they made to feel welcomed?

Once you know what you are looking for, a mystery shopping company will design an evaluation for the correct wording, objectivity, and the appropriate weighting of scores.

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How to Set Up a Mystery Shopping Program: Launching the Program

The first step is to determine what is to be measured and the second step is to determine what type of evaluation method is to be used, such as onsite visits, hidden video, audio recording, and online interactions. “It is typical for clients to use multiple types of programs,” says Welty. “Most businesses have interaction with their customers at three touch points: onsite, over the telephone, and through the Web.”

The provider will script common scenarios and create a checklist of procedures for mystery shoppers to use. “We establish the format. Will it be strictly objective, yes or no? Or will it be more of a narrative. We help determine frequency,” says Godding. Typically, to set a benchmark for performance, mystery shoppers will shop two to four times to provide a fair picture, so no employee can say “I was having a bad day.”

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How to Set Up a Mystery Shopping Program: Appraising the Program

A mystery shopper will make inquiries and observations according to the specifications of each project, noting specific details and measurements about the location and level of customer service provided. The shopper then submits a report; most providers have an online service where clients can review the findings. The million dollar question is what to do with the data and findings.

The most important thing is to follow through with actionable steps. “What do you expect the mystery shopping program to fix, change, or improve,” says Paige Hall, CEO of the Atlanta-based mystery shopping company AboutFace. “We have a consulting arm that helps to round out the story of what’s going on in a client’s organization and what are the three to five action steps to focus on so that strategic decisions can be made.”

For instance, the final report may reveal that your business needs to establish or improve sales and training modules, says Lynn Saladini, vice president at ath Power Consulting, based in Boston and Washington, DC, which works with banks and credit unions. “Maybe you need to develop a set of customer services standards or to update what currently exists,” she adds.

Essentially, you want to make sure that the training that your employees receive is reflected in the service that your customers get. A mystery shopping program can be used as a means to offer employee rewards, incentives and promotions, says Hall. It can be used for suggestive sales. “An increase in sales leads to an increase in revenues.”

Not all mystery shopping companies will give recommendations. Choose a company that provides consultation on what to do with the end-results and research. “Every mystery shopping provider has reporting capabilities,” Saladini says. “But you want a company that can be a partner with your business to help move it forward in meeting your goals and expectations.”

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