Shopping Business Market
Personal & Professional Development 2
Introduction
This essay examines mystery shopping and how businesses use this within their organisation. Mystery shopping is a form of market research technique use by businesses to evaluate their service levels, market opportunities and promote or test new products or creativity. The essay looks at whether or not mystery shopping is good for business. Market research and types of market research methods is briefly discusses. The essay will focus on how mystery shopping is used by businesses as a market research technique.
What is market research?
Market research is defined by Wilson, A., (2006, p514), “as the collection, analysis and communication of information undertaken to assist decisions in marketing”. It can provide important information about the buying behaviour’s needs, preferences, and opinions of current and potential customers.
There are two main types of market researches. These are, primary and secondary research. Primary research is using data to collect specific information. “It is concern with generating new information direct from the targeted population” (Palmer, A. 2005, p203). Whereas secondary research involves evaluating information gathered from primary sources.
Methods of collecting Primary data fall into two main categories; these are qualitative and quantitative research. Qualitative research is “an unstructured, primarily exploratory design based on small samples intending to provide insight and understanding” (Malhotra and Birks 2007,p152).
It is use to understand customers’ attitudes, opinions, feeling and behaviours. Qualitative research is usually carried out among a small group of people in the form a focus group. It involves collecting data from rather small samples and questions are designed to gain insight into the hearts and minds of people. The purpose of this method is, to gather descriptive information, through interviews or focus groups.
Quantitative research on the other hand involves collecting data from relatively large samples; the data collected are usually presented as numbers, often in tables, graphs and on charts McGivern, (2006). Examples of quantitative research are behavioural techniques such as mystery shopping, survey etc.
Background
Rationale
The value of this research is to find out whether mystery shopping is worth investing in. The research will explore and evaluate the effectiveness of ‘mystery shopping’ in service businesses. This research aims to find out why services businesses use mystery shopping, the benefits and drawback for using such method and more so, whether or not the customer satisfaction research technique of mystery shopping works and worth investing in. The questions to be addressed and aims of this research and are:
The result of the research will determine whether or not the technique of mystery shopping works and worth investing in. This information will be beneficial to all service businesses. With the evaluation presented by the research, businesses can examine the benefits and drawbacks of using mystery shopping and decides whether or not to invest in the method or try alternative methods.
This will in turn cut down business expenditures and as a result save money by eliminating unnecessary expenditure. The research can also be a useful source of information and provide thoughtful and practical guidance to professionals.
The purpose of this research is, to examine the role of mystery shopping and evaluate its effectiveness as a research technique for evaluating service quality in service businesses and to determine if it worth investing. The research will look at three big marketing leading companies; The Dorchester, Sainsbury and Barclays Bank, focusing on the views of senior managers responsible for commissioning mystery shopping research in. as a research based on service businesses; different service industries are therefore investigated. This is to provide a much wider view of the topic by not limiting the research to only one company. The anticipated difficulties in undertaking this research are:
It is important that the research is conducted according to the industry procedures and MRS regulation. To do so, the research will:
Today, it is not enough for a business to have excellent products, service or process, It has to create excellent customer experience in order to succeed. The level and quality of service delivered to customers is vital to a business’s success (MSPA www.mspa-eu.org / (Accessed: 2008)). Businesses should not just have expectations of what customer want, they must also measure and inspect their experience. To do so, mystery shopping is often used.
Mystery shopping is a form of participant observation that uses researchers to act as customers or potential customers to monitor the processes and procedures used in the delivery of a service (Wilson. A, 2006). It is an accepted method of research widely used in service organisations to evaluate staff performance and the service customers receive. Professional researchers, known as mystery shoppers disguises as normal or prospect customer to objectively gather information and assess the experience of customers, the quality and standards of service delivered.
Literature review
Mystery shopping is a form of participant observation that uses researchers to act as customers or potential customers to monitor the processes and procedures used in the delivery of a service (Wilson, 2006). It is an accepted method of research widely used in service businesses to evaluate staff performance and the service customers receive. Professional researchers, known as mystery shoppers, are used to find out what customers think of the quality of service delivered.
The Mystery shopper disguises as normal or prospect customer to objectively gather information and assess the experience of customers, the quality and standards of service delivered. They methodically try the customer experience first hand against a specific set service standard (Calvert, 2005, cites Wilson and Gutmann, 1998).
Mystery shopping is also use as a technique to assess performance such as responding to enquiries, provide quotations, dealing with customers on the telephone, problem solving and general care (Hill. N and Alexander J 2006). Mystery shopping measure improves service (Taylor, M. 2008). However, it an overall limited monitoring tool. It limitation relates to the subject nature of mystery shopper’s opinion and the limited view he or she has of the operation entirely (Jr. Spinelli, et, al, 2004).
In terms of motivation the mystery shopping result can be used to reward employees who performed well against he service set standards, (Wilson, A. 1998). This is emphasised by Erstad (1998), who stated that mystery shopping is a positive motivational tool and can result to employee satisfaction. Monitoring personnel performance is critical because “ninety percent of unhappy customers leave a place of business because of inattentive, impolite employees” (Semenak, 2005).
Mystery shopping allows a business to achieve competitive goals to gain a competive edge through excellent customer service delivery. It provides Indepenent and objectives information that allows businesses to see if they actally meeting set standards . Also provide consistency with other stores in the same company. It enables staff to answer questions in the write way to deliver the service customers expect. It helps identify existing training and development needs. It improves service, meet the standards set and makes it possible for the business to see thing from the customers point of view. it allows the company to see if the service actually deliverd.
Although mystery shopping is an effective way of evaluating customer satisfaction method, however, Trying to evaluate a variable using another variable can be a weakness. As technology keeps improving the use of mystery shopping could be changed in the future. Cameras could be use instead to study customer services and staff performance.
Cognitive psychologist have shown that memory is reconstructive (Koriat et al 2000). The human cognitive process is such that perceive, encode and reports all situation differently and therefore limited as it subject to the possibly to forget events Morrison et al 1997.
Methodology
In order to research the topic (How effective is Mystery Shopping in Service Businesses) A critical summary and review of the literature in this field was carried out. Interviews with public service managers in Dorchester hotel, Barclays bank, Sainsbury’s, Miss Selfridges, Tesco’s and Asos was conducted.
The purpose of the interview is to evaluate the effectiveness and influence of mystery shopping to service businesses. A total of seven interview questions were posed to respondent for answers. The nature of questions was predetermined and open-ended qualitative questions were asked.
Qualitative research is “an unstructured, primarily exploratory design based on small samples intending to provide insight and understanding” (Malhotra and Birks 2007,p152). It is use to understand customers’ attitudes, opinions, feeling and behaviours. Qualitative research is usually carried out among a small group of people in the form a focus group.
It involves collecting data from rather small samples and questions are designed to gain insight into the hearts and minds of people. The purpose of this method is, to gather descriptive information, through interviews or focus groups.
Qualitative research gives a holistic view of what is been investigated. In that, it looks for extensive understanding of the circumstance. It generates a more comprehensive, in-depth information and recognises key criteria among customers that can then be measured by quantitative research.
With qualitative research, participants have the opportunity to freely express their views and opinions. They also have the chance to respond in details using their own words. This gives researchers the opportunity to ask follow up questions from previous ones and as a result, can develop answers.
Affect. Despite the strengths mentioned above, qualitative research however, also has it limitations. Samples are base on participants’ opinions, so data can be vague and indefinite. It is difficult to produce definitive conclusion; there is the tendency for researchers to arrive at different conclusions from the same information. Research can only be done in small samples, so result may be inconclusive as a result of the quantity and size of data collected.
Projecting data can be difficult because the analysis is subjective and small quantity of samples is used. Qualitative research is more time consuming than quantitative and because of the time taken to complete, overall it can cost more than quantitative. In response however, it can be argued that generally, compare to quantitative research, the quantity, being small size samples could translate to lesser cost (McGivern, 2006).
Qualitative open ended interview questions are particularly best to research the topic, as I required both the respondent and I needed to understand each other, share control of the conversation, listen to each other, and when there is sufficient time for the conversation to allow proper sharing and listening.
Personal Interview surveys best suit the research undertaken, as the desired sample consists of respondents in a very specific target population. Advantages of this method include: response rates are very good; respondents have the ability to see, express themselves and attitudinal behaviour can be best observed with this method.
This is emphasised by Erstad (1998), concluded argued that mystery shopping is a positive motivational tool and can result to employee satisfaction. However the author did no further research to support his statement. I would have like to see some evidence of primary research on mystery shopping carried to employees, in relation to human resource management to support his conclusion that mystery shopping can result to employee satisfaction.
Customers overall
Experience determines whether a company will succeed or fail. Building a customer experience, which genuinely creates loyalty, is the newest and hardest battleground business face (Wiele, T. V. et al, 2005). Meeting customers’ needs and expectation has gone far beyond product availability. Businesses also have to provide quality service and build customer relationship.
Customers and business relationships are managed through a system known as Customer Relationship Management (CRM). CRM emphasises on gaining customers and retaining them through effective management of customer relationship. It is a comprehensive approach that promises to Maximise relationship with all customers (Chen and Popovich, 2003).
Usually, business use mystery shoppers to find out about the level of customers service provided. However, in some cases they are also asked by the business to find out and assess the tidiness and cleanliness of a store, presentation, stock availability staff appearance, queue lengths and manners (for example, did the staff say hello, offers to help, thank you and good bye)
It cost ten times more to get a new customer than to keep an existing one. 68% of customers leave businesses because of poor customer service. An unhappy customer will tell at least five other people of their bad experience with service. (MSPA www.mspa-eu.org / (Accessed: 2008)). The purpose of mystery shopping is to get researchers posing as customers to experience and assess the quality of service delivery.
Mystery shopping is mostly used in retail. Data collected from mystery shopping can be used by businesses to interpret customer survey results, measure subject criteria such as the friendliness of staff, to effectively assess supplier behaviour in business markets and to carry out comparisons with competitors. Also it use as a technique to assess performance such as responding to enquiries, provide quotations, dealing with customers on the telephone, problem solving and general care (Hill. N and Alexander J 2006). Mystery shopping measure improves service (Taylor, M. 2008).
In terms of motivation the mystery shopping result can be used to reward employees who performed well against he service set standards, (Wilson, A. 1998). This is emphasised by Erstad (1998), who stated that mystery shopping is a positive motivational tool and can result to employee satisfaction. Mystery shopping allows a business to achieve competitive goals to gain a competive edge through excellent customer service delivery. It provides Indepenent and objectives information that allows businesses to see if they actally meeting set standards.
Also provide consistency with other stores in the same company. It enables staff to answer questions in the write way to deliver the service customers expect. It helps identify existing training and development needs. It improves service, meet the standards set and makes it possible for the business to see thing from the customers point of view. it allows the company to see if the service actually deliverd. How ever despite it strengths, mystery shoping also has limitations. It is expensive. Trying to evaluate a variable using another variable can be a weakness. As technology keeps improving the use of mystery shopping could be changed in the future. Cameras could be use instead to study customer services and staff performance
Customers are, of course, the central concern for marketers and satisfying their needs is very important. A business has to tailor its approach to meeting these needs (Blythe 2006). Understanding the needs and expectations of customers is very essential for every business. Market research is carried out to evaluate and understand customers’ needs. Customers play a key and integral part in the success of a business. Without customers there is simply no business. Cartwright (2000) argued that without customers, “there would be no work, therefore no income and no jobs”.
This shows how important customers are and how vital it is that there needs and expectations are met. To understand customer needs and expectations, service businesses often use mystery shopping in conjunction with customer relationship management techniques. It helps identify staff training and development needs. With mystery shopping, businesses can get first hand information on the quality of their service, product etc. Building customer relationship has become a fundamental for businesses.
Customer relationship marketing techniques such as CRM and TQM, are also used in conjunction with mystery shopping to maximise result. It allows businesses to focus on the customer rather than the product.
In terms of motivation the mystery shopping result can be used to reward employees who performed well against he service set standards, (Wilson, A. 1998). This is emphasised by Erstad (1998), concluded argued that mystery shopping is a positive motivational tool and can result to employee satisfaction.
However the author did no further research to support his statement. I would have like to see some evidence of primary research on mystery shopping carried to employees, in relation to human resource management to support his conclusion that mystery shopping can result to employee satisfaction. Also the use of motivational theories such maslow’s hierrarchy of needs and herzbergs motivational thory would been good evidense to back his statement and link it to theory.
Task: 3 – Research Method
The purpose of this research is, to examine the role of mystery shopping and evaluate its effectiveness as a research technique for assessing service quality in service businesses. The research focuses on the views of senior managers responsible for commissioning mystery-shopping research.
The research identified the main uses of mystery shopping in service businesses and methods and systems such as CRM, used to increase the reliability of the technique. The research aimed at identifying the benefits and drawbacks of mystery shopping, its usefulness as a technique used to measure service quality and employees performance and evaluate its influence on service businesses.
Methodology
In order to research the topic (How effective is Mystery Shopping in Service Businesses) A critical summary and review of the literature in this field was carried out. Interviews with public service managers in Dorchester hotel, Barclays bank, Sainsbury’s, Miss Selfridges, Tesco’s and Asos was conducted.
The purpose of the interview is to evaluate the effectiveness and influence of mystery shopping to service businesses. A total of seven interview questions were posed to respondent for answers. The nature of questions was predetermined and open-ended qualitative questions were asked.
Qualitative research is “an unstructured, primarily exploratory design based on small samples intending to provide insight and understanding” (Malhotra and Birks 2007,p152). It is use to understand customers’ attitudes, opinions, feeling and behaviours. Qualitative research is usually carried out among a small group of people in the form a focus group.
It involves collecting data from rather small samples and questions are designed to gain insight into the hearts and minds of people. The purpose of this method is, to gather descriptive information, through interviews or focus groups.
Qualitative research gives a holistic view of what is been investigated. In that, it looks for extensive understanding of the circumstance. It generates a more comprehensive, in-depth information and recognises key criteria among customers that can then be measured by quantitative research.
With qualitative research, participants have the opportunity to freely express their views and opinions. They also have the chance to respond in details using their own words. This gives researchers the opportunity to ask follow up questions from previous ones and as a result, can develop answers.
Affect. Despite the strengths mentioned above, qualitative research however, also has it limitations. Samples are base on participants’ opinions, so data can be vague and indefinite. It is difficult to produce definitive conclusion; there is the tendency for researchers to arrive at different conclusions from the same information. Research can only be done in small samples, so result may be inconclusive as a result of the quantity and size of data collected.
Projecting data can be difficult because the analysis is subjective and small quantity of samples is used. Qualitative research is more time consuming than quantitative and because of the time taken to complete, overall it can cost more than quantitative. In response however, it can be argued that generally, compare to quantitative research, the quantity, being small size samples could translate to lesser cost (McGivern, 2006).
Qualitative open ended interview questions are particularly best to research the topic, as I required both the respondent and I needed to understand each other, share control of the conversation, listen to each other, and when there is sufficient time for the conversation to allow proper sharing and listening.
Personal Interview surveys best suit the research undertaken, as the desired sample consists of respondents in a very specific target population. Advantages of this method include: response rates are very good; respondents have the ability to see, express themselves and attitudinal behaviour can be best observed with this method.
Task4: Interview Questionnaire Report
In order to carry out the research on the topic, interview questions in the form of a questionnaire were developed. The questions were specially designed to get answers for the aim of the research mentioned in task 1 page 5. My desired sample consists of respondents in a very specific target population. My targets respondents are service businesses that carry out mystery shopping. To get a wider response, the interview was targeted at different sectors of service providers.
I interviewed managers at Sainsbury’s, Tesco’s, Miss Selfridges, Asos, who are retail outlets, Abbey and Barclays Bank from the Finance industry and The Dorchester Hotel, which is in Hospitality. During the interview, I found out that although they all primarily carry out mystery shopping, however each sector seems to have a different term for it. For example, the Dorchester refers to their mystery shopping as GAP inspections.
The research findings show that there were three main reasons for using mystery-shopping technique of customer service evaluation:
The issues that arose on the research from the respondent point of views are that the research is expensive to carry out; trying to evaluate a variable using another variable can be a weakness.
This report only accounts for 600-word count. For this reason the research samples have had to be limited to only six businesses focusing on the managers who are responsible for commissioning mystery shopping and a few employees. Therefore sample may be unrepresentative due to the target population size.
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