Mystery Shopping– the Miracle Tool in Business Research
VOLUME NO. 3 (2013), ISSUE N O. 01 (J ANUARY) ISSN 2231-5756 A Monthly Double-Blind Peer Reviewed (Refereed/Juried) Open Access International e-Journal – Included in the International Serial Directories Indexed & Listed at: Ulrich’s Periodicals Directory ©, ProQuest, U.
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HIERARCHY PROCESS MOJGAN RIAZI, DR. YOUNOS VAKIL ALROAIA & DR. ALI AKBAR AMIN BIDOKHTI ASSOCIATION OF TRAINING PRACTICES WITH JOB SATISFACTION IN PUBLIC SECTOR ORGANIZATIONS RIZWAN BASHIR & FARZANA BASHIR STUDYING THE RELATIONSHIP BETWEEN SOCIAL CAPITAL AND TALENT MANAGEMENT IN IRAN STATE MANAGEMENT TRAINING CENTER (SMTC) SAYED ALI AKBAR AHMADI, MOHAMMAD ALI SARLAK, MUSA MAHDAVI, MOHAMMAD REZA DARAEI & SAMIRA GHANIABADI CONTEMPLATIVE SCRUTINY OF THE ADEQUACY OF HERZBERG’S MOTIVATION-HYGIENE
THEORY: A VERDICT OF JOB SATISFACTION IN THE MID LEVEL MANAGER IN TELECOMMUNICATION INDUSTRY ABU ZAFAR AHMED MUKUL, SHAH JOHIR RAYHAN & MD. SHAKIB HOSSAIN PLANNING AND MANAGING A SCHEDULED SERVICE DR. IGNATIUS A. NWOKORO REAL INCOME, INFLATION, AND INDUSTRIAL PRODUCTIVITY IN NIGERIA (1970-2005) Dr. OWOLABI A. USMAN & ADEGBITE TAJUDEEN ADEJARE DEVELOPMENT OF SMALL AND MEDIUM ENTERPRISES IN NIGERIA: A PARADIGM SHIFT ADEYEMI, A.
ADEKUNLE THE EVALUATION OF KNOWLEDGE MANAGEMENT’S EFFECTIVENESS ON E-LEARNING: A CASE STUDY ON PAYAME NOOR UNIVERSITY OF IRAN BAHAREH SHAHRIARI & KIARASH JAHANPOUR THE RELATIONSHIP BETWEEN ORGANIZATIONAL CULTURE AND JOB SATISFACTION AMONG PROFESSIONAL STAFF IN VIETNAMESE CONSTRUCTION COMPANIES NGUYEN PHI TAN ANALYSIS OF LIQUIDITY OF SELECTED PRIVATE SECTOR INDIAN BANKS SULTAN SINGH, SAHILA CHOUDHRY & MOHINA PRODUCTIVITY MEASUREMENT OF PUBLIC SECTORS BANKS IN INDIA DR. BHAVET, PRIYA JINDAL & DR. SAMBHAV GARG IMBIBE ETHICAL EDUCATION DR. T.
SREE LATHA & SAVANAM CHANDRA SEKHAR MODELING INDIAN MONSOON (RAINFALL) VOLATILITY AS AN INDEX BASED RISK TRANSFER PRODUCT D P. SHIVKUMAR, M PRABHU & DR. G. KOTRESHWAR THE DEVELOPMENT OF SMALL SCALE INDUSTRIES IN MEGHALAYA MUSHTAQ MOHMAD SOFI & DR. HARSH VARDHAN JHAMB REGRESSION MODELS M. VENKATARAMANAIAH & M. SUDARSANA RAO EFFECTIVENESS OF EMPLOYEE RETENTION TECHNIQUES ADOPTED BY BPO COMPANIES WITH REFERENCE TO CHENNAI DR. RANJITHAM. D ROLE OF FOREIGN DIRECT INVESTMENT IN EDUCATION INSTITUTIONS IN INDIA SHABANA, SONIKA CHOUDHARY & DR. M. L.
GUPTA AN EXAMINATION OF LONG-RUN AND SHORT-RUN RELATIONSHIP BETWEEN CRUDE OIL PRICE, GOLD PRICE, EXCHANGE RATE AND INDIAN STOCK MARKET R. KANAKARAJAMMAL, S. PAULRAJ & M. V. ARULALAN MYSTERY SHOPPING– THE MIRACLE TOOL IN BUSINESS RESEARCH SHAKEEL-UL-REHMAN & A. VELSAMY THE EMPIRICAL INVESTIGATION BETWEEN EMOTIONAL COMPETENCE AND WORK PERFORMANCE OF INDIAN SALES PEOPLE DR. RITIKA SHARMA MARKETING OF BRANDED PRODUCT IN RURAL AREA: A CONCEPTUAL BASED STUDY ON RURAL MARKET PANKAJ ARORA & AJITHA PRASHANT A STUDY ON EMPLOYEES JOB SATISFACTION WITH SPECIAL REFERENCE TO COACH FACTORY P.
MANONMANI & V. UMA E-CRM APPLICATION IN INSURANCE SECTOR AND RETENTION OF CUSTOMERS DASH BISWAMOHAN. & MISHRA RADHAKRISHNA THE USAGE OF SIX SIGMA TOOLS IN BRINGING DOWN THE DEFECTS IN THE HR PROCESSES SREEJA K & MINTU THANKACHAN WOMEN EMERGING GLOBALLY AS THE POTENTIAL MARKET: REASONS, IMPLICATIONS AND ISSUES DR. JAYA PALIWAL URBAN RESIDENTIAL WATER SUPPLY IN GADAG TOWN IN KARNATAKA STATE DR. H H BHARADI TECHNICAL ANALYSIS: A TOOL TO MEASURE MARKET VOLATILITY G. B. SABARI RAJAN CO-BRANDED CREDIT CARD – A TAILOR-MADE PRODUCT NICHE FOR CONSUMERS DR.
A. JESU KULANDAIRAJ A COMPARATIVE STUDY ON CUSTOMER SATISFACTION WITH SERVICE QUALITY IN PUBLIC AND PRIVATE SECTOR BANKS DR. SAMBHAV GARG, PRIYA JINDAL & DR. BHAVET EMOTIONAL INTELLIGENCE (EI): AN IMPERATIVE SKILL FOR MANAGERS IN THE GLOBAL WORKPLACE SMARTY MUKUNDAN Page No. 1. THE EXTENT OF THE IMPORTANCE OF PERSONALITY INDICATORS OF INDEPENDENT ENTREPRENEUR THROUGH USING GROUP ANALYTICAL 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 8 14 21 29 34 40 45 49 54 57 63 66 72 83 86 91 94 101 104 111 120 123 128 136 140 144 150 153 157 160 REQUEST FOR FEEDBACK INTERNATIONAL JOURNAL OF RESEARCH IN COMMERCE, IT & MANAGEMENT A Monthly Double-Blind Peer Reviewed (Refereed/Juried) Open Access International e-Journal – Included in the International Serial Directories ii http://ijrcm. org. in/ VOLUME NO. 3 (2013), ISSUE N O. 01 (J ANUARY) ISSN 2231-5756 CHIEF PATRON PROF. K. K. AGGARWAL Chancellor, Lingaya’s University, Delhi Founder Vice-Chancellor, Guru Gobind Singh Indraprastha University, Delhi Ex.
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INTERNATIONAL JOURNAL OF RESEARCH IN COMMERCE, IT & MANAGEMENT A Monthly Double-Blind Peer Reviewed (Refereed/Juried) Open Access International e-Journal – Included in the International Serial Directories vi http://ijrcm. org. in/ VOLUME NO. 3 (2013), ISSUE N O. 01 (J ANUARY) ISSN 2231-5756 MYSTERY SHOPPING– THE MIRACLE TOOL IN BUSINESS RESEARCH SHAKEEL-UL-REHMAN RESEARCH SCHOLAR ANNA UNIVERSITY OF TECHNOLOGY CHENNAI A. VELSAMY ASSOCIATE PROFESSOR DEPARTMENT OF MANAGEMENT STUDIES SONA COLLEGE OF TECHNOLOGY SALEM ABSTRACT Satisfied customers are an important advantage for almost every company. Every company tries its level best to deliver better services to make the customers satisfied.
A customer must be satisfied up to the highest possible level. Mystery shopping is a type of research tool to measure the level of satisfaction, a customer experiences through impartial way. The present paper tries to bring out the conceptual understanding of mystery shopping – tries to explain the openness of mystery shopping to various arenas whether public or private and how it creates attention for improving performance of the company. KEYWORDS Mystery Shopping, Mystery Shopper, Customer Services, Customer Satisfaction, Employee Appraisal, Competitive Advantage. INTRODUCTION nowing the customer satisfaction is always the top prerogative in any business.
Getting to know the level of satisfaction and (or) the changing expectations of customers’ is a continuous process. Though there are various methods and tools available for this, mystery shopping is considered as unique and undeniable tool in any organisation. As defined by Wilson (2001), mystery shopping is “a form of participant observation that uses researchers to deceive customer-service personnel into believing that they are serving real customers or potential customers”. Mystery shopping is a technique that involves looking at your business from outside and measure the efficiency of your own key processes from the view point of customers. Mystery Shopping can be carried out in person, by telephone, or less commonly by email.
It can recognize strengths and weaknesses and aid to show exactly where service delivery can be improved. In instances where excellent service is provided, the service may be considered an example of best practice and specific staff members can be singled out for recognition and reward. Initially set up in retail and private sector service industries, now mystery shopping is used increasingly in the private as well as public sector to gain a better understanding of how service users are taken care of when they approach front line offices. Research is the foundation stone of effective marketing planning and is vital for implementing successful marketing strategies.
Mystery shopping is a research to know about company in customer point of view. It is the use of individuals, skilled to measure any customer service process, by acting as potential customers and in some way reporting back on their experiences in a detailed and objective way. It is also an act of purchasing goods and services for collecting information for market research. K REVIEW OF LITERATURE Although the concept of mystery shopping is old, there are very less literature available in its field. Since the use mystery shopping as a tool of research has got much concern in the present business competition, investigating through the literature becomes imperative.
As the use of mystery shopping is gaining much importance in the present chase of competition. The literature obtained by the investigator, in the form of various reports and research studies is briefly reviewed in this part. Banks and Murphy (1985) have noted that organizations prolong to articulate discontent in performance assessment systems even though advances in appraisal technology. Appraisal reliability and validity still remain a major problem in most assessment systems. Mystery shopping is the collection of facts, not perceptions. The mystery customer questionnaire or checklist should emphasize objective questions with a view to collecting factual data, again negating another weakness of customer surveys, i. e. hat customers only remember their overall impression of a service and not the individual elements or transactions (Wilson, 1998). Finn & Kayande, 1999 found that the process mystery shopping uses a form of member observation to observe the behavior of employees, usually in the process of providing services; the resulting data are then used for evaluation purposes. The process usually includes a structured interaction between the representative and the service provider; an employee whose behavior is being assessed. It is followed by an evaluation interview in which the manager gives the employee feedback about the data collected during the interaction. This procedure is intended to increase the accuracy of the service provider.
Bromage, (2000) found it as an integral training tool in that it can be used to identify training needs. Wilson, (2001) defined mystery shopping as a form of participant observation that uses researchers to deceive customer-service personnel into believing that they are serving real customers or potential customers. Shing and Spence (2002) argue that their use to gather competitive intelligence is parallel to industrial espionage and conclude that in such cases mystery shopping is difficult to defend ethically. Karia, 2005 stated that mystery shopping in India is of not a much scope but some of the big corporate have started to do mystery shopping for increasing their service delivery. Brender-Ilan, B. nd Shultz, T. (2005) found that the procedure of mystery shopping research is intended to increase the accuracy of the service provider valuation, as this type of jobs is considered rigid to appraise impartially. Obviously, the process is used differently in different organizations, and for different purposes. CONCEPTUAL UNDERSTANDING Mystery shopping is necessary for companies to get an objective opinion on how their business is doing. If they used their own employees to evaluate their service and operations, it would be biased. So mystery shoppers, who don’t already have a connection with the company, are used to provide honest and unbiased feedback.
In the UK mystery, shopping is increasingly used to provide feedback on customer services provided by local authorities, and other non-profit organizations such as housing associations and churches. Mystery shopping is a term that describes a field based research technique of using independent auditors posing as customers to gather information about product quality and service delivery by a retail firm. The mystery shopper poses as a customer in order to objectively gather information on the business being INTERNATIONAL JOURNAL OF RESEARCH IN COMMERCE, IT & MANAGEMENT A Monthly Double-Blind Peer Reviewed (Refereed/Juried) Open Access International e-Journal – Included in the International Serial Directories 01 http://ijrcm. org. in/ VOLUME NO. 3 (2013), ISSUE N O. 01 (J ANUARY) ISSN 2231-5756 studied. Getting a customer’s view of one’s business is a widely recognized tool in both the marketing and customer service arenas. When mystery shoppers are dispatched to visit a business, they use criteria developed by the client to evaluate the business and focus primarily on service delivery and the sales skills of employees. Their reports, usually written, are forwarded to the client and can be used in a number of ways. Mystery shoppers can also objectively evaluate competitors and their service delivery and product mix for comparisons and benchmarking.
Mystery Shopping is also known as Ghost Shopping where industry serves to evaluate the customer service for any company that deals with customer satisfaction. By sending an anonymous ghost shopper, that forms the base on their visits to client locations. Ghost shopping helps in evaluating the service provided by the company’s’ channel members to its customers. From this information companies can understand whether it is meeting, or failing to meet, it’s customer’s needs. Ghost shoppers are everyday people who are visiting stores as anonymous customers, and in the process helping these stores to better understand how they can meet customers’ needs. METHODS OF IMPLEMENTATION
Mystery shopping can be done by two methods a) A company uses its own employees to perform the mystery shopping, in which company trains its own employees to collect the customer related enquires from the market and b) Some companies can engage marketing research companies to evaluate the superiority of service in their stores; these companies use mystery shoppers to get the information in disguise. They disperse a mystery shopper to make a particular purchase in a shop or store, for example, and then report on the experience and understanding. Typically, the shopper is compensated, and can keep the product or service. Mystery shopping can be used in any industry, with the most common venue being retail stores, hotels, movie theaters, restaurants, fast food chains, banks, gas stations, automobile dealerships, apartments, health clubs and health care services Mystery shopping can allow a firm to create a competitive edge. It can also assist retailers in developing and evaluating strategies to retain current customers.
The first step in mystery shopping is to identify your firm’s important customer service characteristics and objectives often flowing from your strategy and overall goals and objectives. Next a firm uses these variables to develop a mystery shopping questionnaire, either alone or with the help or a consultant or mystery shopping firm. The survey can include a mix of description and check-off questions. WHY & WHERE MYSTERY SHOPPING? In this growing severely competitive environment, there is an ever-increasing need for companies to gather evidence on whether their policy initiatives have had the intended outcomes and whether retail firms treat their customers fairly.
In particular, the need is to measure and evaluate the impact of company policies, assess levels of firms’ compliance with rules and examine the experience consumers have of the market. Mystery shopping is regarded as a necessary means of gathering such information. This is because of the problems inherent to surveying those who have recently purchased products – consumers don’t always exactly recall all the particulars. Some of the benefits of mystery shopping are; Product Placement, Point of Selling, Visibility, Customer Demand, Repurchases, Brand Recall, Awareness. Mystery shopping is useful to know about the awareness of that brand, how many outlets are having this product? Through it one can get the information about the competitors like their new product launches, market share, new promotions, campaigns, etc.
Even you can check the placement of the product in the outlet, whether the product has got right place on shelf, visibility of product, how fast product is moving, impulse buying appeal of the product, etc. A “conformist” mystery shopper in-person visits more of business locations. The assessments are typically discrete questions along with the correlated point values, as well as some narratives for amplification. However, due to advances in technology as well as evolving customer service requirements, the ability to gather data and other materials relating to a customer’s experience has been significantly increased. Mystery shopping can allow a firm to create a competitive edge. It can also assist retailers in developing and evaluating strategies to retain current customers.
Typical areas of assessment are customer service, suggestive selling and up-selling techniques, teamwork, employee and management activities, head-count, store appearance and organization, merchandise displays and stock, cleanliness of the location, signage and advertising compliance, time in line and time elapsed for service, product quality, order accuracy, customer’s preferences, cash handling, and return policies. After pre-testing the questionnaire, mystery shoppers are hired to do an assessment. Assessments can be on-site or via the telephone or even the Internet. A sample size as well as a period of time for the mystery shopping program is determined and results are used for feedback.
BENEFITING RANGE OF BUSINESS Mystery shopping is more visible in developing countries and it is mostly prevailing in retail sector. But other sectors also use it as a tool to measure their customer satisfaction, competition, new technology advancements etc. some of the areas where mystery shopping is seen commonly are Banks, Restaurants, Hotels, Supermarkets, Automobile shops, Repair shops, Bars, Clubs, Theaters, Shopping malls, Retail chain operators. FMCG companies, Consumer durable companies, Apparel retailers. Mystery shoppers are professional in this field as he charges a reasonable amount from the companies for doing this service of conducting research.
A feedback is given by them to the client whether the services are being performed according to expectations or not and gives a chance for the further improvements that company thinks necessary for its survival. On the other hand they tries to offer a better delivery to the customers to make them satisfied and a company can attract more and more customers if it is efficient in the market USE AND EXECUTION OF MYSTERY SHOPPING Managers can use the reports from mystery shoppers to evaluate their position in the industry, and the results can be used to provide employee recognition and other positive reinforcements of loyalty and morale through incentive programs.
Many restaurants, banks, supermarkets, and clothing retailers have used the techniques, along with hotels, furniture stores, grocery stores, gas stations, movie theaters, automotive repair shops, bars, athletic clubs, bowling alleys, and almost any business where customer service is important. As the service sector of the economy has increased, so has the demand for mystery shoppers. Some retailers are large enough to have their own in-house program in place. Other smaller companies who do not have the resources to develop a quality mystery shopping program in-house use mystery shopping contractors. These contractors directly hire and train the mystery shoppers, who work as independent contractors.
The reports from mystery shoppers can measure training and levels of customer service pre- and post-training. Mystery shopping allows managers to determine if the services provided by employees are appropriate. Shopping reports can assess promotional campaigns and even verify employees’ honesty in handling cash and charges. Reports over time can give up a longitudinal database of averages. Some industries share findings so that managers can know regional or national averages of the industry. At the Web site Managerspot. com, for example, restaurant owners can compare their numbers from mystery shopping reports with a pool of similar, but anonymous, restaurants.
The use of mystery shopping is just one part of a company-wide program to develop and enhance employee performance. The idea is to find out from a consumer’s point of view which areas of service and product quality are most important and what areas need improvement. Data from the shopping results can be used by the company to make necessary changes on a timely basis. The results should be used for developmental and reward purposes and not for punishment. Mystery shopping is a valuable tool to businesses and is especially helpful for small, start-up businesses that need accurate and fast information to assess their employees and compare their products and services to the competition.
So mystery shopping is a process for exploring everyday experiences, one person’s view at a snapshot in time, a way of identifying strengths and weaknesses in dealing with customers, a method of measuring employees’ performance against set customer service standards, a useful aid for identifying training needs. INTERNATIONAL JOURNAL OF RESEARCH IN COMMERCE, IT & MANAGEMENT A Monthly Double-Blind Peer Reviewed (Refereed/Juried) Open Access International e-Journal – Included in the International Serial Directories 102 http://ijrcm. org. in/ VOLUME NO. 3 (2013), ISSUE N O. 01 (J ANUARY) ISSN 2231-5756 Mystery shopping can be used for various purposes. Most of the time the goal is to measure the quality of the service delivery to the customer.
In this situation the mystery guest can be focused on the compliance to specific standards, guidelines or demands, or the mystery guest can be instructed to position the quality of the service on a scale. If a mystery guest visits locations of competitors, benchmarking becomes a way to judge your own activities against those. GROWING NECESSITY OF MYSTERY SHOPPERS Managers can use the reports from mystery shoppers to evaluate their status among its competitors and the scope of increasing the business. Also this tool is highly reliable, and the results can be used to provide employee recognition and other positive reinforcements of loyalty and morale through incentive programs.
The use of mystery shopping is just one part of a company-wide program to develop and augment employee performance. The idea is to learn from a consumer’s point of view which areas of service and product quality are most important and what areas need improvement. Data from the shopping results can be used by the company to make necessary changes on a timely basis. The results should be used for developmental and reward purposes and not for punishment. Mystery shopping is a valuable tool to businesses and is especially helpful for small, start-up businesses that need accurate and fast information to assess their employees and compare their products and services to the competition. MYSTERY SHOPPING IN INDIA
Mystery shopping is not much practiced in India; some of the organizations who have initially used this type of research are ICICI Bank, Titan, Arrow and Reliance communications. ICICI Bank used mystery shopping initially in Pune to check the services offered by one of its branches, it conducted survey by telephone through mystery shoppers to find out the different services provided to different age groups by the bank (Karia, P. M. , 2005) CONCLUSION In the present age of competition there are various tools of research available for the companies to measure their service level from the customer point of view. One such efficient tool is mystery shopping, which is also called as ghost shopping. It can be viewed as an efficient tool in measuring the customer satisfaction with the company.
No doubt, companies are spending lot of resources in ensuring customer satisfaction and to know what actually customers want. Mystery shopping can be chosen as an efficient tool in knowing the overall details of positive and negative aspects of services provided to customers. It can also be used to rectify the problems a company actually faces in dealing with the customers. REFERENCES Banks, C. G. & Murphy, K. R. (1985) “Toward Narrowing the Research-Practice Gap in Performance Appraisal”. Personnel Psychology, Vol. 38 (2), pp. 335– 345. 2. Brender-ilan, Y. and Shultz, T. (2005) “Perceived Fairness of the Mystery Customer Method: Comparing Two Employee Evaluation Practices”. Employee Responsibilities and Rights Journal, Vol. 17(4), pp. 231-243. 3. Bromage, N. 2000) “Mystery Shopping – It is Research, But Not as We Know It”. Managing Accounting, Vol. 78 (4), pp. 30-35. 4. Cawley, B. D. , Keeping, L. M. & Levy, P. E. (1998) “Participation in the Performance Appraisal Process and Employee Reaction: A Meta-Analytic Review of Field Investigation”. Journal of Applied Psychology, Vol. 98 (4), pp. 615–621. 5. Finn, A. (2001) “Mystery Shopper Benchmarking of Durable-Goods Chains and Stores”. Journal of Service Research, Vol. 3 (4), pp. 310-320. 6. Finn, A. and Kayande, U. (1999) “Unmasking a Phantom: A Psychometric Assessment of Mystery Shopping”. Journal of Retailing, Vol. 75 (2), pp. 195–217. 7. Karia, M. P. , (2005) “Ghost Shopping”. http://www. indiamba. com. 8.
Shing, M. N. K. and Spence, L. J. (2002) “Investigating the Limits of Competitive Intelligence Gathering: Is Mystery Shopping Ethical” Business Ethics: A European Review, Vol. 11 (4), pp. 343-353. 9. Stovall, S. A. (1993) “Keeping Tabs on Customer Service”. Bank Marketing, Vol. 25 (6), pp. 29-33. 10. Wilson, A. M. (1998) “The Role of Mystery Shopping in the Measurement of Service Performance” Managing Service Quality, Vol. 8 (6), pp. 414-420. 1. INTERNATIONAL JOURNAL OF RESEARCH IN COMMERCE, IT & MANAGEMENT A Monthly Double-Blind Peer Reviewed (Refereed/Juried) Open Access International e-Journal – Included in the International Serial Directories 103 ttp://ijrcm. org. in/ VOLUME NO. 3 (2013), ISSUE N O. 01 (J ANUARY) ISSN 2231-5756 REQUEST FOR FEEDBACK Dear Readers At the very outset, International Journal of Research in Commerce, IT and Management (IJRCM) acknowledges & appreciates your efforts in showing interest in our present issue under your kind perusal. I would like to request you to supply your critical comments and suggestions about the material published in this issue as well as on the journal as a whole, on our E-mail i. e. [email protected] com for further improvements in the interest of research. If you have any queries please feel free to contact us on our E-mail [email protected] com.