The intense competition in virtually every industry and every market has companies searching for any strategy that gives them an advantage in the marketplace. The two most obvious differentiators, price and quality, have not provided the definitive edge. Price leadership is difficult to achieve because margins can only go so low and quality can be difficult to define.

What’s left? Service. The problem is, U.S. consumers don’t just appreciate good service, they expect it. They have many alternatives for products and services and will happily seek them out if one provider isn’t meeting their needs.

To make sure service standards meet customer expectations companies have established policies for employees throughout their operations. These rules of conduct are meant to foster a positive attitude toward the company and the products or services it offers. Making sure employees meet these standards is critical to success. Company management would like to believe customers are being treated according to these norms. How to make sure?

Mystery shopping. By deploying mystery shoppers on a regular, timely basis, companies get precise performance evaluations of employees and products.

Mystery shopping specialists got their start 50 years ago checking on employee and client integrity. Common early uses included determining employee honesty, price-checking to verify compliance with fair trade agreements, and finding out how retailers were presenting products and using signage and other point-of-purchase displays. Monitoring employee courtesy and interaction with customers was of secondary interest.

Since 1980 the situation has turned around. In industry after industry company management is evaluating how customers are treated when coming in contact with their employees. Qualitative reports have been expanded to include quantitative results and industry averages and norms have been developed. Local managers can use individual reports to measure their own situation while regional and company management can use summaries to determine trends, strengths and weaknesses.

For perspectives on where mystery shopping’s role in business today, and to pick up some tips for buyers of mystery shopping services, I contacted four individuals, who, along with their firms, have years of experience in mystery shopping: Bill Smith, president of Certified Marketing Services, Kinderhook, N.Y.; Peter Thorwarth, president of Better Marketing Associates, Oaks, Pa.; Carol Cherry, president of Shop’n Chek Inc., Atlanta; and Christian Doomanis, vice president operations for Commercial Services Co., Van Nuys, Calif. Although each company initially provided mystery shopping services to different industries or specialized in different services, they offered remarkably similar opinions.

  • The variety of industries using mystery shopping has increased dramatically during the 1980s and ’90s, leading to a proliferation of firms offering the service. Unfortunately, not all of them have the experienced personnel to provide top-level service. In addition, some unethical firms seriously damage the image of mystery shopping by selling "mystery shopping training kits to consumers, with the implied promise that the information provided is necessary for the individual to be considered as a mystery shopper.
  • Clients’ need for fast turnaround is increasing. In some cases local managers are receiving in-store interview results in a day. In that way clients can micromanage their business and correct problems quickly.
  • It is important for employees to be aware that the firm is conducting mystery shopping and that their performance is being monitored to improve service and satisfaction, not to spy on them for the purposes of punishment. Tying incentive programs for outstanding performance to mystery shopping efforts create a positive atmosphere. The incentives need not be monetary.
  • Clients should ask about industry experience when interviewing prospective service providers. Within the mystery shopping field companies tend to develop areas of expertise. Each client and each industry is unique - shopping banks is much different than going into fast food restaurants-so make sure to find out about the firm’s areas of expertise.
  • It is likely that mystery shopping firms will be asked to work for competing firms. The experts I spoke with see no problem with doing so as long as the firms involved are aware of the situation and give their approval. If it becomes necessary to competitively shop one of their clients they should notify the client of the situation.

    Most mystery shopping companies will shop their clients’ competition. While this may make some companies nervous, it’s a necessary situation and one that actually is beneficial because it allows clients and mystery shopping firms to develop industry norms.
  • Mystery shopping firms must have knowledge of legal guidelines for each state in which mystery shopping takes place and make the client aware of the ramifications, particularlyifreports might be used to evaluate employee performance.
  • Every client seems to have unique needs. While many questionnaires contain identical questions almost every client asks for specialized information not requested by other clients in the same field or industry. The same holds true for the reporting of results.
  • A key to the success of a mystery shopping program is selecting the correct shoppers. The profile of the mystery shopper should match that of the client’s customer. To meet this criteria the mystery shopping company should have developed a large database of thousands of potential shoppers, enough to eliminate those who might have biases due to present or previous employment or other impediment.
  • Shoppers must be properly trained and understand the objectives of the project. Proper training means that evaluations should not vary from one location to the next and will be similar regardless of the geographic area shopped. Having a large pool of mystery shoppers available ensures that they will not be recognized.

All of the folks I spoke with agreed that the future looks bright for mystery shopping. Continued growth is expected in the U.S. and rapid expansion will be occurring internationally because companies are seeking to establish global standards to provide consistency throughout the world. That way, fast food patrons can one day expect the same level of cleanliness in Moscow, Russia and Moscow, Idaho.