Mystery shopping has traditionally been utilized as a means of measuring and improving customer service levels and employee performance. Some companies have taken mystery shopping a step further and "shopped" their competition to see how they perform across key customer service and sales initiatives.

A less well known use of mystery shopping is for competitive intelligence. At its most basic level, it can be used to measure the competitor's service levels alongside the company's performance. Taking this approach a step further, this method of analysis can provide companies with even greater information than previously thought. Below are some examples of ways companies have used mystery shopping as a form of competitive intelligence:

1. Brand loyalty

A manufacturer was concerned that sales were dropping for their products in several retail stores. Mystery shoppers were used to visit the retail stores and "shop" for the manufacturer's product. The manufacturer was able to determine if sales associates were leading customers away from their brand, and what was being said about their brand. Taking it a step further, a scenario was designed in which mystery shoppers would be interested in two products – one of the manufacturer's and another of a competitor. Posing as undecided between the two, mystery shoppers would ask the associate for their recommendation. This allowed the manufacturer to determine which brand was being recommended and why, and how this impacted their sales at the retail level.

2. Breaking into a new market

A contractor service was ready to expand their business into a new market and sought out two potential markets of interest. Before making a decision, the company utilized mystery shoppers to glean competitor information. Mystery shoppers would contact similar services that already existed in each market, posing as a potential customer. Shoppers would listen to the sales presentation, gather pricing, and document policies and service procedures. Data was collected for each competitor in each of the two markets for further analysis. The contractor service was able to compile this information along with the other market analysis they had performed to ultimately decide which market would be most beneficial to break into. Further, they were able to create methods to present their services that would be unique and different from their competition, giving them an edge when breaking into the new market.

3. Offering a new product or service

One retail company was preparing to launch a new service. Before doing so, they wanted to seek out information on their competitors who offered a similar service. Specifically, they wanted to find out their competitor's cost for the service and how it was promoted to potential customers. Mystery shoppers were utilized to contact the competitors across different markets to inquire about this service. They were responsible for documenting the cost involved, as well as the features and benefits of the service. Once this information was gathered, the company was able to set a competitive price point and create a marketing plan to promote this new service in a way that would differentiate themselves from the competition. This resulted in a strong marketing campaign, and the new service performed very well with strong, consistent sales.

Monitoring the competition's customer service levels is a smart move in any case, especially in difficult economic conditions. Mystery shopping programs can meet this need. Additionally, using mystery shopping for competitive intelligence, as illustrated above, can be an inexpensive, effective way of gathering vital information about competitors and can assist in making solid business decisions.


Source by Marianne Hynd

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