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Mystery Shopper's Lounge

Published Friday Jun 15, 2012


If the bar is hopping, it can be hard to keep tabs on how the staff is doing amid the laughter, the music and the constant flow of orders being taken and drinks poured and delivered.

So how would a proprietor know if the bartender is giving free drinks to a friend or slipping a few tens in his back pocket or if a waitress is being surly to customers?

Well, that guy nursing a beer next to you may not be just another customer-he may be there undercover. Many restaurants, bars and hotels hire mystery shopper services to send professional bar managers undercover as customers to check in on the bar staff. It's a practice used by many in the hospitality industry, where good customer service is not just an expectation, it's the reason people become repeat customers. A 2011 survey by American Express and Echo found that 73 percent of consumers spent more with companies that provided good customer service-reportedly 13 percent more.

There are more than 300 mystery shopper companies worldwide according to the Mystery Shopping Providers Association. New Hampshire is home to or serviced by about half a dozen companies. Those companies report high client retention rates and growth in recent years. Mystery shoppers at restaurants, bars, hotels and spas record everything from how long it takes for food to arrive to how servers handle special requests. However, it's not just about catching employees' bad behavior. Some hotels and restaurants also reward employees with bonuses and gift certificates based on good mystery shopper feedback.

It provides an invaluable service by doing what we can't, which is to sit in the customer's seat, says Brian Shea, chef and owner of The Barley House Restaurant in Concord. Our mystery shopper program has provided us with direct and honest feedback and that [positively] impacts our bottom line.

Shopping for Service

Excellent customer service is the foundation of the hospitality industry, yet it is tough to effectively measure. Customers may fill out comment cards, but they often provide few details. Yet how customers are treated directly affects whether a business prospers and evolves or remains stagnant and risks closing its doors.

Enter the world of mystery shopping services. Most businesses contract for one mystery shop per month, though some businesses request only a few per year, while others have multiple visits per month. Experts say costs range from about $30 a shop for a basic one-page report with yes-or-no questions and answers on a scale of one to five, to $300 to $400 a shop for a report that could be 10 pages or more that includes detailed information on wait times and commentary on the customer experience.

Armed with the knowledge of their strengths and weaknesses, a business can take action to exceed customer expectations, says Judi Hess, who founded Customer Perspectives in Hooksett in 1983. We custom design what the mystery shopper will be looking for with our client, so it is not a cookie cutter report.  It is tailored to what they want to know about their own business.

That means a high traffic establishment, like fast food service, might request a less detailed report than a fine dining restaurant because of the time spent and the expectations of its average customer, says Hess. For function halls, secret shoppers could be asked to count the number of rings before a salesperson answers and whether the salesperson anticipates additional needs of the customer and makes a personal connection with them. Hotels will request mystery shoppers to book rooms and spend the night to rate overall cleanliness and evaluate room service (for instance, by requesting extra towels).

Hess says mystery shoppers are almost always recruited online and paid per shopping experience, from $2 to $4 for a quick telephone shop to $50 for a more complex shop. They receive explicit instructions, such as ordering a salad and asking for dressing on the side or requesting detailed information about a dish to test servers' knowledge.

Though expectations vary among businesses, a minimum grade of 80 percent (a solid B) is what most businesses hope for, according to Hess. Customer Perspectives provides about 5,000 mystery shops to clients in NH and 20,000 nationally each year in a range of industries including hospitality and finance.

And even with the economy still tight, mystery shopping services report high demand. Goodwin & Associates in Concord has provided mystery shopping services to the hospitality industry since 2001. Sales Director Brian Calderone says business is still growing, with revenue up by about 60 percent in 2011, and he says even the recession did not greatly affect demand for their business.

We have literally thousands of clients nationwide, and about 70 we shop for in the state, and I would say approximately 96 percent are returning to us year after year, he says. In tough economic times, businesses are focusing more on customer satisfaction and minimizing loss. It may be harder these days to attract new customers, so you focus on retaining the ones you have.

Beyond Better Service

Using mystery shopper services not only improve customer service, they can improve company profits. Eric Roberts, owner of Lui Lui Restaurants in Nashua and West Lebanon, has used Goodwin & Associates for the past seven years. He says it has kept servers and managers on their toes and also brought in new customers through word of mouth advertising.

We get very detailed reports and communication, Roberts says. And they've brought us new customers through mystery shoppers returning on their own time, often with friends. It makes our business continue to grow each year.

Ryan Colwell, general manager of Red Hook Brewery and Cataqua Pub in Portsmouth, agrees with Roberts. The brewpub serves about 140,000 people a year and Colwell started using Customer Perspective's mystery shopping service about 18 months ago. He has shoppers visit twice a month and he says it has improved business in a number of ways, including fewer customer service complaints and more patrons (both new ones and regulars) filling the brewpub tables and bar. Waitstaff provide a better level of customer service, and in turn receive larger tips, he says, so the information gained by the service is not only good for the business, but for the staff as well.

Our mystery shop scores have definitely improved over the past year and this past year was a record year in customers served. If a customer gets great service and food, they tell their friends and they come back. It is a pretty simple cause and effect, he says.

For bars, mystery shopping services like Goodwin & Associates also offer loss prevention programs, a major concern for businesses. The average bar can lose hundreds to thousands of dollars per month from free drink giveaways, over pouring and even outright theft.  Our service sends not just a shopper,' but a professional bar manager to do the mystery shop, Calderone explains. The shopper' sits at the bar as any customer would, monitoring pour counts, cash handling  and free drinks that might be given away. This is a method of identifying loss revenue for many establishments.

Colwen Hotel Management, a Nashua-based company that owns and operates 14 NH hotels and 15 more nationwide, uses Shoptalk 2000, an Illinois-based mystery shopping service for the hotel industry that provides insight into how places like Ashworth by the Sea and the Portsmouth Harbour Events Center rate in terms of customer satisfaction. Colwen requests the mystery shopper call at least two times per year and has shoppers access three different event departments in all of their hotels (catering, banquets and group bookings).

This ensures that whoever calls to book an event, a set of rooms or catering services has the best customer experience possible, says Felice Kreitman, Colwen's vice president of sales and marketing. These areas (group bookings and corporate negotiated accounts) represent a large part of our revenue stream, as it does for any hotel, and the mystery shopper service tells us what the customer calling us might typically experience. It is invaluable.

The insight is so valuable that Colwen Hotels factors the results into the bonus plans for its employees. If a salesperson at a hotel scores above 80 percent on the mystery shop, they are rewarded through an increase in their incentive bonus. According to Kreitman, if the score is poor, the employee might lose a portion of their incentive bonus. Whether the score is high or low, the results help the company decide if an employee is properly suited for their current position or requires additional training.

None of us want[s] that phone to stop ringing because we were not meeting our customers' expectations. The value in this [service] is really self-evident, Kreitman says.

Tips for Customer Satisfaction

Understand you are in the service business: Most companies think about their business as offering a product.  But everyone is in the business of customer service.

Eliminate all the policies/procedures that make it more difficult for customers: You could have the nicest people in the world, but inconvenient wait times or procedures that push away customers will lead to failure.

Create a team of employees: Every employee needs to be a part of the solution. Rewards for offering great service and accolades in front of peers goes a long way.

Educate and train the whole staff on the art of customer service: The most important person in every single company is the frontline employee who greets guests. Stress the importance of using the customer's name, remembering the customer and making each customer feel special.

Measure the results and know the impact customer service is making on your business: You have to track the numbers so you understand that it's worth the time and effort. If you work on greater customer satisfaction, the numbers should follow. 

Source: Judi Hess, Customer Perspectives

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