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Mystery shopping and customer satisfaction – An integrated approach

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20th Oct 2006
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Sue Madeley, Director Financial Services Research and Angie Cowdery, Head of Operations, Maritz Research offer their insight into the complexities of mystery shopping. But while mystery shopping is appropriate and is of benefit for Financial Services companies, it also has limitations of use that specifiers must be aware of.

Most companies who are intent on improving standards of customer service have used mystery shopping as a form of measurement and evaluation at one time or another. But what is it and how is it conducted? Essentially, mystery shopping is a method of measuring the quality of a product or experience of a service. Researchers, posing as customers, purchase and use the product or experience the service. This could range from having a query dealt with person-to-person, purchasing a financial service product online or making a complaint through a call centre. The 'shoppers' record details of the experience and the behaviour of the employees or service they encounter, along with an overall opinion of the experience they had. Evaluations can be conducted in person, by telephone, by web or by email.

MSPA Europe (the Mystery Shopping Providers Association) has recently reported that the mystery shopping market in Europe is expected to grow by 75% by 2010, approximately an 11% increase annually. This is a much higher rate of growth than any other management information market sector.

Mystery shopping has been used for many years, so why it is suddenly growing in popularity? We believe that many companies are realising that mystery shopping is a proven way of gaining information that cannot be gleaned through more traditional methods, such as customer satisfaction surveys.

Mystery shopping offers Financial Services companies real benefits and insights into the perception of their products and is a good source for monitoring regulatory compliance for service delivery standards and specifications. Marketeers can assess the gap between promises made through advertising or promotions and the actual service delivery. It can also be a useful tool to monitor the impact that training and performance improvement initiatives have on compliance and customer experience. However, there are some limitations to mystery shopping that Financial Services companies must consider.

Complexity

Interactions between any customer or prospective customer and the organisation have a myriad of variations dependent on the nature of the enquiry and the specific financial details of the customer. This can provide challenges when trying to devise a programme to measure compliance, assess the process and the behavioural aspects of the interaction.

Market Driven

Apart from face to face retail and call centre mystery shopping programmes, there is often a need for Finance Services companies to gain insight into issues that arise quickly. In these instances, short and fast fieldwork with speedy and concise reporting is typically required to provide valuable insight while the news is still current.

The Experience versus process and compliance

In an environment where the critical aspects of the customer experience relates to the manner in which financial information is delivered within the framework of the legal requirement to be FSA compliant, it is often unwise to add further to an evaluation by asking mystery customers to measure additional unrelated areas. Some clients are keen to combine the measurement of the customer experience with that of processes and compliance. This can work well in short evaluations, but when used in longer interactions there is a risk of information provided by the mystery customer being diluted, making the findings less accurate.

Real Customers or Recruited Evaluators?

There is an argument for recruiting genuine customers either in addition to or instead of professional evaluators. The real customer can go further in an evaluation as they use their own personal details, making the interaction more natural and potentially more valuable. However, various factors can influence the evaluation skill of real customers, such as a positive or negative past experience with the company, inexperience completing detailed questionnaires and the presence or lack of core skills, essential to mystery customers, such as reliability, honesty, attention to detail and a good memory!

In contrast, whilst the core skills of a trained mystery customer will ensure quality feedback on the experience, unless they are an actual customer, there are limitations on how far they can take their enquiry.

Segmentation/Demographics

One of the biggest challenges of Financial Services mystery shopping is recruiting the right person for the job, with a limited number of individuals capable of market-driven mystery shopping projects that provide the most valuable results for finance companies. We frequently find that, whether real customers or professional mystery customers, these people must fit the profile of a high-value customer to ensure the interaction is credible.

Mystery shopping is in widespread use throughout the Financial Services industry, from retail banking and insurance to investment banking. Examples include:

 

  • Regulatory compliance, including employee knowledge and integrity
  • Product and service experience from a multi channel perspective
  • Retail outlets such as branch networks
  • On and off shore call centres
  • Web and email transactions
  • Market conditions and competitive positioning
  • Distribution Channels
  • IFA’s, partners

Programmes run the gamut from conducting a simple transaction, such as cashing a cheque, to inquiring about specific bank products, to more complex transactions such as working with a financial adviser to assessing whether or not they’re offering products to meet the customer’s needs.

Today’s consumers have many choices available to them, and their expectations of customer service are ever-increasing. Coupled with the decline in standards of customer service in many industries, it is easy to see why more and more companies are interested in discovering whether the service they deliver is in sync with their customers’ needs.

Take the following example for instance. Maritz designed a programme for a large retail bank, which included collection of customer satisfaction data at branch level in addition to a recruitment project to recruit shoppers to become genuine customers. We then tracked their experiences throughout a typical customer life cycle. Over several months, shoppers visited the banks to conduct cashier and ATM transactions and make product inquiries. They tracked direct marketing materials and statements received at home, and logged how long it took to receive cheques or ATM cards.

This activity gave the bank valuable feedback for branches and service centres, showing how they measured up against corporate standards and the criteria for each type of interaction.

Key criteria

There are several ground rules that a Financial Services company should consider when looking to design a mystery shopping programme with the intention of capturing service experience.

Firstly, it’s extremely important to establish service standards that are based on actual customer data. In other words, make sure that you’re measuring those areas that will have a direct impact on customer satisfaction and loyalty.

Initial planning should consider the following:

 

  • What it is you want to measure, based on the voice of the customer
  • Which channels you want to measure and how often
  • How to communicate the programme to the organisation
  • How to disseminate results
  • How do you plan to take corrective action and provide training to ensure continuous improvement

Secondly, the programme should be driven by what your customers are telling you they want. It should also measure what your brand communications are telling your customers to ensure the programme delivers real, positive business results. It is also very important to gain buy-in from key areas within your company as people are much more likely to support a programme that they helped create.

Finally, companies benefit from building an integrated approach for capturing and utilising the voice of the customer, with mystery shopping forming one of those components. We believe this is best done by using multiple and complementary methods of listening, which is why we often recommend both mystery shopping and Customer Satisfaction Surveys to our clients. For example Maritz Call Centre Monitor (MCCM) is designed to help customer service managers understand the customer experience, right down to advisor level.

As part of MCCM, customer satisfaction research provides critical design input to Mystery Shopping research. Ongoing tracking studies provide robust data to help understand customer needs. Sophisticated analysis tools can also be used to identify the importance of individual attributes and underlying factors, which drive overall satisfaction and loyalty.

Mystery shopping research provides evaluations tailored to each experience at the appropriate brand/segment/outlet level. Survey scenarios are therefore based on key visit or channel experiences and evaluators are selected specifically to reflect those key customer segments and reflect customer priorities.

The chart below shows the optimum return on call handling improvements.

Using both complementary methodologies allows strategic insight and direction at an overall level, as well as tactical diagnostics at the individual outlet or call centre level.

Getting started

Mystery shopping is a critical component of any customer experience measurement programme and a valuable complement to any customer satisfaction or loyalty programme.

Maritz works with many companies new to this type of analysis as well as those that may have tried similar, but unsuccessful, programs in the past. The voice and expectations of the customer are assessed and this information used throughout the organisation when creating and communicating measurements throughout the company. We then provide the necessary training and the actual execution.

Mystery shopping, traditionally, is a tool used in a very objective way to assess critical behaviours and standards by which you can measure your front-line employees’ behaviour. By setting specific objectives and providing relevant training, individuals can develop their skills and improve overall service levels and customer satisfaction.

If you would like to learn more about the Maritz Research approach, visit www.maritzresearch.com or contact +44 (0)1628 495 600.

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