by Judith Ann Hess

An element of almost every retailer’s marketing strategy today is devoted to convincing potential customers that their stores offer more friendly, efficient and personalized service than its competitors. But do your customer contact personnel really live up to this image? Or might they be inadvertently undermining every advertising dollar you spend?

Clearly, your marketing dollars are ill spent if you fail to upgrade the capabilities of your customer contact personnel. Advertising promotes interested prospects, but these do not become or remain customers if your store provides inadequate service.

Since management has neither the luxury nor the anonymity to regularly observe the actual performance of customer service personnel, how can you be sure they are routinely conveying the appropriate image to their customers? After all, your marketing strategy is only as good as your personnel are!

Many retailers attempt to upgrade quality service via training programs but fail to include a system of information feedback. If an investment in employee performance is crucial to your success, only a continuous, systematic evaluation of your training efforts will protect that investment.

Objective measurement of the quality of your service delivery, as well as your training efforts, is as difficult as it is vital. Although sales statistics are useful, there are too many variables to isolate quality of service. Customer surveys are also informative, but they can be both costly and time consuming. The alternative - “shopping” - is a unique and relatively objective tool of measurement that is remarkably free of these constraints.

In “shopping”, (sometime called “mystery shopping”), trained and supervised “shoppers” actually engage in typical transactions with customer contact personnel and then rate specific attributes from a customer’s perspective. These include such traits as:

• Friendliness
• Attitude
• Courtesy
• Product knowledge
• Appearance
• Sales ability

The ratings are done in a manner that allows easy comparisons between employees, shifts, locations, and periods of time. This provides important data about the effectiveness of your employee selection and training, thus giving you a built-in, objective and systematic feedback loop.
Comprehensive shopping audits can help you determine the effectiveness of your internal marketing strategies so that you may upgrade them, thereby enhancing your image, your service, and your market share. You will, in effect, be minimizing human “turn¬offs” and thereby keeping the promises of satisfaction implicit in your service offering.

Judith Ann Hess is the owner of Customer Perspectives^TM; 213 West River Road, Hooksett, NH 03106, Tel: (603) 647-1300 / 800-277-4677.

by Karen Gomes Moore, Customer Perspectives^TM

Mystery shopping - getting a customer’s eye view of your business - is widely recognized as a valuable marketing and customer service tool. What is often not recognized is the many ways a mystery shopping program can be utilized. Here are some ideas to consider.

PREPARING FOR NEW COMPETITION
If you get advance notice of impending competition, you are wise if you do all you can to be ready for it. This includes knowing the current state of your employees’ customer service skills.

A long-time client of our firm is a mid-sized department store with seven locations in two states. When it was learned that two national chains were locating in or near the same mall as its flagship store, the client ordered an intensive two-month mystery shopping program designed to do two things. The first was to take a “snapshot” of how employees were treating customers on a day-to-day basis. Our client wanted to know if customers were routinely being greeted, helped and thanked by every employee who had any customer contact. We, therefore, targeted the employees on the sales floor and at the cashier lines.

In addition, our client was interested in learning if the stress level of the December holiday season was being communicated by employees to the customers - something he did NOT want to happen! This obviously called for some subjective judgment on the part of the mystery shoppers, but we directed the shoppers to support their opinion in the narrative section of their report. This “snapshot” evaluation was designed to identify strengths and weaknesses which could be addressed either by management or further training.

MONITORING COMPETITORS
Keeping an eye on the current competition is another valuable use of mystery shopping. Many of our clients evaluate not only their own locations but those of their closest competitors. Using the same evaluation form and the same shopper at each establishment, the client learns how the competition is doing, judged by the client’s own criteria. This method has been used quite successfully by several of our banking clients, as well as supermarkets and clothing retailers.

EMPLOYEE RECOGNITION/INCENTIVE PROGRAMS
Recognition programs are an excellent use of mystery shopping programs. “Catching the employee doing something right” is a positive reinforcement of your company training program and builds employee loyalty and morale.

To institute an effective employee recognition program, you must first decide what it is you want to recognize. Is it the basic service amenities (such as a warm greeting or a thank you to every customer) or are you trying to promote a new product/service and want to make sure it is being mentioned to customers? Perhaps you just want to keep employees “on their toes” with the thought that ANY shopper MIGHT be a mystery shopper. If the employee who gets the best report from the mystery shopper is recognized in some way, those goals will be met. Recognition can take the form of cash, gift certificates, a plaque or trophy, mention in the company newsletter, a preferred parking space, or anything else that seems appropriate.

Closely tied to recognition programs are incentive programs. Customer service evaluations are often a part of the formula that determines an employee’s bonus. Sometimes they are part of contests in which individual stores or regions compete to determine who can achieve the best scores for customer service.

We are often asked how big a role mystery shopping reports should play in individual performance reviews. It is our feeling that while they can certainly be taken into account and are sometimes helpful in documenting a pattern of behavior, they should never be used as the sole basis of a performance review.

MEASURING TRAINING
The most common use of mystery shopping is to measure training. Such measurement can be done to evaluate the existing level of customer service prior to implementing a training program, to develop a training program, to evaluate recently completed training, or all three.

By evaluating the existing level of customer service prior to beginning a training program, a benchmark is established. The trainer can then more accurately assess what areas need to be addressed, as well as what is currently succeeding and should be reinforced.

Training programs can be implemented either company-wide or as a test in a targeted location or region. In either case, the most successful training programs are those that have clearly defined goals and seek measurable results. They should take into account company standards, previous training, and the employees who will be participating.

Evaluating customer service after training is also very valuable. By doing so, the effectiveness of the training program can be measured, using a custom designed evaluation form developed to highlight the areas in which training took place. Mystery shopping scheduled for shortly after the conclusion of a formal training program will highlight areas of success and continuing weakness. Trainers can determine what techniques and teaching methods worked well in getting the message across to employees, and which didn’t. Follow-up training can then be designed. Over a period of several months, or longer, continued improvement in specific areas can be documented, as can areas of persistent weakness.

A well thought out, properly managed mystery shopping program provides valuable feedback about the effectiveness of a company’s employee selection and training. The knowledge that the next customer might be a mystery shopper can heighten service awareness and thereby upgrade performance. In addition, establishing and monitoring standards is almost always well received by employees if it is presented in a positive manner. This is because such directives tend to eliminate confusion on the part of employees and increase motivation.

Ongoing training and assessment is vital to achieving the type of high-level customer service that commands customer loyalty - and repeat business. Mystery shopping is one of the best ways to determine the customer service your employees are giving - and what they’re capable of once the proper training is provided.

A menu for survival

In its fourth-quarter 2008 earnings report, McDonald’s reported that same-store sales increased by an impressive 5 percent in the U.S. and 7.2 percent globally. Those figures stood in stark contrast to the rest of the news coming from the restaurant industry, which for months has been a bleak litany of location closings, plummeting earnings and declining traffic.

With no end in sight to the bad tidings, we spoke to three researchers who specialize in the restaurant industry to get their insights on how marketing research - from online research with recent diners to comment cards and IVR-based surveys and mystery shopping - can help dining establishments weather the current storm.

Beyond discussions on the role of research, one main piece of advice for restaurateurs emerged from our conversations: stay the course. In other words, whatever your outlets do well, keep doing it. If you’re known for offering cheap food made fast, keep it coming. If customers come to your chain expecting a fun, festive atmosphere, make sure that’s what you deliver. Now is no time to cut back or scrimp on the things that make your brand what it is. “Stick to your marketing message but also make sure you deliver on your marketing message. Say it and live it,” says Rick Garlick, senior director of strategic consulting at St. Louis-based Maritz Research.

In addition to delivering on core brand promises and upholding quality, restaurants of all stripes can use research to make sure employees are adhering to corporate service standards and practices and, perhaps more importantly, that they are excelling as brand ambassadors. “Every restaurant has policies and philosophies and guidelines and a set of standards they want their teams to execute, and it can be something as simple as a guest being greeted within 30 seconds of being seated, the timing of entrees, checking back to make sure every guest is thanked on the way out. Without any measurement device, it’s hard to determine if those things are being done and how well they’re being done,” says David Agius, owner, The Sentry Marketing Group, Dallas.

Agius argues that that’s where mystery shopping can be of value, as it can note the quality of the greetings or goodbyes, rather than just the fact that they were uttered, and get at some of the satisfaction-enhancing nuances of service. “At a full-service restaurant, let’s say the standard is that every guest is said goodbye to. That may be the standard but what was the tone of the goodbye? How personal was it? How sincere does somebody appear? Feedback on service doesn’t cost anything to correct but it can be the difference between somebody coming back or not coming back,” he says.

What value means

First and foremost, the consumers who are still dining out are looking for the most bang for their buck when it comes to spending their precious discretionary income, so eateries would be smart to consider emphasizing value. “Whether you’re a fast-food player or a fine-dining establishment the last thing you want to do is alienate customers by lowering quality,” says David Morris, senior food and restaurant analyst at Chicago research company Mintel. “Really, offering quality food at a fair price is the minimum requirement for success for restaurants as the environment becomes more competitive in the downturn. Consumers are in the driver’s seat in being able to seek out quality dining experiences that deliver more on value.”

But of course, different dining segments define value differently, Morris says, and research can help by showing a restaurant what value means to its specific consumer segments. “For a fine-dining establishment value is important but you’re looking at a very different [customer] rationale for choosing a fine-dining establishment. These operations need to be a lot more artful in how they communicate value, more subtle. They need to weave elements of value into those that enhance the spirit of indulgence and celebration that comes with the fine-dining experience, extras that may further pamper the diner, rather than something like a three-for-one special.”

While they attempt to deliver value to their customers, restaurants can also create value for themselves, Agius and Morris both suggest, by making better use of ingredients that might already be on-hand. Restaurants may want to try to “thin down the number of SKUs that they bring in - you’ll see a lot of them focusing on in that right now,” Agius says. “They have a few items that are used in a multitude of ways and the focus is on executing the menu really well and making sure that the food and the guest experience live up to expectations.”

Diners’ emotions

While the standards of quality food, good service and fair prices are givens, there is also some room for restaurants to appeal to diners’ emotions. Not specifically of the “come enjoy a great meal to forget about your troubles” ilk but rather reminding consumers of the reasons they dine out in the first place: to mark special occasions, spend quality time with family and friends or to establish and nurture relationships. “You can’t give them money to spend, but what you can do is remind consumers how important dining out has been to them and the emotional positives it has provided and can continue to provide,” Morris says. “If you look at some of the most prevalent reasons for dining out, they involve celebration, treating oneself, doing something special for other people - these are all things that I think will still be important to consumers in this environment. Will they be able to spend as much? In all likelihood, no, but strong and savvy marketing strategies that connect to those need-states can insure that consumers still look to restaurants to help satisfy those needs.”

Earn loyalty

Learning about diners’ motivations and how they make their choices is one part of a three-phase research approach, Garlick says. The other two parts involve examining how effectively restaurants deliver on the dining experience promised by their marketing campaigns and how restaurants can earn and keep diners’ loyalty. “We believe that the whole key to success in restaurants and the hospitality industry in general is creating a differentiating experience for the customer,” Garlick says. “Once we understand what customer motivations are through choice research, then customer experience research or customer satisfaction research can take the next step to look at how well the restaurant is delivering on the value proposition that brought people in in the first place.

“So with a brand like Chili’s for example, which is all about a fun dining experience, beyond asking if the food was hot, the server friendly, and did you get your food in a timely manner, you want to see if it was a fun experience. Of all of the things the brand is trying to accomplish, did it deliver? Did it resonate with the consumer?”

Plan to cut back

A December 2008 Maritz survey of frequent diners found that 34 percent of people said that they plan to cut back on the number of times they dine out in the next six months and 20 percent said they planned to downgrade the class of restaurants that they frequent. Thus fine-diners will be moving toward the Red Lobsters and Olive Gardens of the world and fans of those restaurants will be trending toward the fast-food outlets.

In other words, Garlick says, “The higher up you are, the more likely you are to suffer in these next six months. These tough times are, no pun intended, a golden opportunity for McDonald’s and similar restaurants because they have the opportunity to appeal to that segment who are trading down. A good way for those kinds of restaurants to use research is to look at the needs of these people who might be using them more now than in the past. What are they looking for? What kinds of products and services might represent some new opportunities to capture their business going forward?”

“In an economic downturn I think it’s more important than ever for restaurants to really understand their consumers - what they’re looking for and how the pressure of the recession is affecting their spending patterns, to be able to develop strategies to help maintain guest traffic, which is really what it’s all about right now,” Morris says. “The restaurant industry is really bleeding guest traffic and feeling a lot of pressure because of the migration on the part of the consumer to either trade down to cheaper restaurants or trade out of restaurants and back to food at home. Ultimately, it’s important to know customers as well as possible in order to target the practical, emotional and lifestyle rationales consumers have in choosing to dine out.”

Trimmable expense

Just as consumers these days may regard dining out as a luxury, restaurant firms may see market research as a trimmable expense, rather than as a necessary tool to help market their brands and maintain guest traffic. Not surprisingly, all three researchers argued that now is not the time to cut back on marketing research. Rather, it’s time to use it to ensure that the dollars being spent, on everything from marketing to everyday operations, are working their hardest. “If I have fewer marketing dollars to spend, and fewer ad dollars and promotional dollars, and with all of the strategic decisions I need to make to compete in a very tight market, I need to make my choices wisely,” Garlick says.

“So much of restaurant research has devolved into immediate feedback. Clients want to buy surveys about was the food hot, the service timely, would I come back here, etc. But what they don’t do is link their brand research and their choice research into their experience research. You have to go beyond just measuring quality. You need to create the experience that will make similarly-minded customers spread the word to other customers. We know the importance of word of mouth in a lot of industries but it is especially important in the restaurant industry. Restaurants need to connect to people at a real emotional level, to the point where they really like a restaurant and it becomes part of their daily experience and becomes a hard habit to break rather than something that can be tossed overboard in tough times.”

Agius says some clients are asking why they should spend money on a marketing research program right now. “Our answer back is, ‘Why wouldn’t you?’ Don’t you want to know if the people who are coming into your restaurant every day are being taken care of in a manner that is consistent with your operating processes, philosophies and procedures?”

More selectively

While a certain segment of the population will have to stop dining out, the vast majority will keep doing so, just more selectively. “Over the past 15 to 20 years, especially when you look at younger consumers, their lifestyles have been tailored around going out to eat. It’s a $500-billion industry, so it’s those consumers who might find it more difficult to pull back from behaviors that are such a part of their lifestyle,” Morris says.

Though short-term issues like customer traffic are certainly paramount, Morris argues that keeping an eye on long-term trends during a recession can help poise a restaurant for even greater success in a more spend-friendly economic environment. “It’s very important not to lose sight of the bigger picture. I think looking at food quality and playing to one of the longer-term trends, like healthfulness or convenience, is going to be very important. These trends don’t evaporate in a recession - they’re still there and need to be addressed. Healthfulness is something that is going to gain momentum. Whether restaurants like it or not, I think the government has already begun taking a closer a look at the caloric and content issues on restaurant menus and that’s only going to pick up. The issues the U.S. has with consumers being overweight and health care costs is something that’s going to be here now and three years from now and five years from now. Those are instances where I think restaurants can continue to prepare themselves for, really, the inevitable change that will come with requiring healthier fare in more transparent ways.”

Source: https://www.quirks.com/articles/2009/20090307.aspx?searchID=25814526&sort=4&msg=3, Joseph Rydholm, Quirk’s Editor and Emily Goon, Quirk’s Content Editor.

By Judi Hess

Here at Customer Perspectives^TM, we know a successful mystery shopping program doesn’t just “happen”. After over two decades in the business, we’ve got some ideas about what can make a program work best for you. Consider the following:

• Know what your objectives are. It’s important that goals be defined in specific and measurable terms.

• Keep it simple. It’s tempting to develop lengthy questionnaires in an attempt to cover all possible behaviors, but in our experience, the simpler, the better. Confusion and frustration are avoided and the information obtained is more reliable.

• Corollary: Allow your mystery shopping provider adequate time to pre-test the questionnaire before rolling out the full program. Weak spots will be detected and modifications can be made more easily and less expensively.

• Identify the mystery shopping company that best suits your company’s needs. Some companies specialize in particular industries; others limit themselves to defined geographic areas. Some companies offer mystery shopping as an adjunct to other services such as customer surveys, concept and design testing, brand image research, and focus group moderation. Others, like Customer Perspectives^TM, specialize in mystery shopping only.

• Get your front line on board. It’s vital that the people responsible for the results of the mystery shopping program - front line employees, supervisors, store managers and regional managers - understand and are supportive of the program. This is especially true if incentives are tied to the mystery shopping program. Before the program is finalized, management MUST make sure key players are fully informed about how the program will work and how the results will be used.

• Assign adequate supervision on your end. A well run mystery shopping program will require administrative time on your end. Make sure the person assigned to handle the program has the authority to make decisions and the time to act on the results (e.g. coach, provide recognition).

• Review periodically. This is important to keep the program fresh and relevant.

If you’d like to talk about ideas for your mystery shopping program, contact us at 1-800-277-4677 or email judi@customerperspectives.com.

Source: Judi Hess, the founder and sole owner of Customer Perspectives, LLC, one of America’s first mystery shopping firms.

Judi is currently President of the North America Chapter of MSPA, the worldwide trade association for mystery shopping providers.