SERVICE: Mystery rate

June 15, 2005

When a pizza delivery driver rings the door bell, Pat Benson is checking him out.

Not for his looks, but to see whether he's tidy, wearing a correct uniform, is bereft of "piercings" and whether he uses a proper greeting.

If the driver's hot, that's a bonus. But if his pizza's not, that's a bummer in more ways than one.

Benson (a fictitious name used to conceal her identity) is a freelance mystery shopper for a large customer research company that hires thousands like her to evaluate companies' products and services. The pizza chain Benson "shops" is one of a few clients she reviews, including supermarkets and video rental stores. The data she gathers is both topical and technical, ranging from a driver's arrival time to the condition of the pizza's crust.

"One thing I have to do is use a special knife to cut the pizza in a certain way so I can photograph the crust," said Benson. "They then want me to e-mail that photograph in so they can see it."

Benson doesn't always know what the pizza client hopes to discover with such information, but her instructions make it clear that the data is more for the operator than the shopper.

"There's some room on the survey if you need to add your comments, but you can tell they've tried to take your opinion and judgment out of it by the questions they ask," she said. "It's pretty much just a check list with yes and no answers, or a rating scale from 1 to 5. I'm sure it makes sense to them."

Highly detailed sense, said Michael Mallett, owner and chief executive of Corporate Research International in Findlay, Ohio. The company hires mystery shoppers, crunches the data they gather and then disseminates it to the companies that request it. The results can give operators

What's Important

Pizza operators are increasingly using mystery shoppers to get an unbiased review of their shops.

On top of hired mystery shoppers, some operators are using phone and/or Internet guest feedback surveys to provide another perspective.

Though outside surveys can be pricey, operators say they are well worth the investment.

a broad picture of overall product and service goals, as well as allow them to dissect problems at particular operations.

"A client can see exactly how his company did for this month, or if they've done this for a while, the last six months," said Mallett. "You can take a question that deals with how they're greeting customers, and drill all the way down to the store level to find out how they've done. That helps operators know where they might need to spend money, be it on more training or hiring training."

Papa John's has gathered performance data via mystery shoppers for years. A company official said the information is so helpful, that it gets a large share of the credit for the chain's most recent top score in the limited service category in the American Consumer Satisfaction Index survey.

"We do think there's a correlation between our internal measurements and the increases that we saw in our score ... this year," said Chris Sternberg, senior vice president of corporate communications at Louisville, Ky.-based Papa John's. The chain's 78 out of 100 outpaced Pizza Hut and Domino's Pizza by 7 points, as well as the top hamburger and chicken chains. "We spend a good amount of resources each year to measure product quality and service, but we get a very good return on that investment."

Feedback from pros and novices

CiCi's Pizza also uses mystery shoppers to check on its operations, but it recently began using customer feedback to gain a different perspective. Steve Hawter, CiCi's director of training, said the one to two monthly mystery visits done at each store didn't provide "a fair look" at how guests really perceived the CiCi's experience. It's one thing, he said, to send a sharp eye to a store looking for certain criteria, but it's another thing entirely to ask a guest how their visit made them "feel about our products, our restrooms and our service. ... The manager's perception of how well a shift ran could be great, but if the guest didn't perceive that it was a great experience, then we want to know why."

To get them talking, CiCi's gives out feedback cards to every customer when they pay for their meals. With the offer of a free soft drink on a return visit, the card encourages them to perform

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one of two options: place an 800-number call to an automated survey attendant (also called interactive voice recognition, or IVR); or log on to a special Web site, where they can fill out the survey. The result is more information from multiple perspectives.

"That allows us to generate 50 guest intercepts per quarter, versus three" from mystery shoppers, said Hawter, whose 545-unit company is in Coppell, Texas. "That feedback gives us a better understanding of what the big picture looks like, better than just one snapshot. It's viewing our operations through a different lens."

Happy Joe's Pizza & Ice Cream gets its performance feedback exclusively from guest-activated IVR. The Bettendorf, Iowa, chain used to use mystery shoppers but found their reports somewhat subjective, said Kristel Whitty-Ersan, the company's queen of marketing. Guests simply tell it like it is, she said.

"One thing the IVR does is allow guests to communicate with you immediately after their experience," she said.

Should a guest report a negative experience, the company gets an alert message and the restaurant manager — called a head coach at Happy Joe's — gets an order to contact the guest and fix the problem. The rapid turnaround time, Whitty-Ersan said, is crucial to smoothing out ruffled feathers quickly.

"You can defuse their anger with a call within 24 hours to make it right — before they tell 20 people about it," she said. "Guests seem to be forgiving if you acknowledge a mistake and fix it."

Sternberg said negative customer reviews from mystery shoppers go to Papa John's headquarters, and the offending store crew is put on notice.

"We send them the results to make sure they're aware that they've fallen down in certain areas," he said. "They take the steps to fix whichever area they've fallen down on, and then we follow up with additional store visits to confirm that the corrections have been made."

Mallett said some of his clients use the scores to encourage good performance and as a basis for rewards. Whitty-Ersan said Happy Joe's ties good scores to its head coaches' bonuses.

Net results

Both CRI's Mallett and CiCi's Hawter say the Internet has revolutionized mystery shopping. Both the amateurs and the pros can respond quickly and easily, which makes data collection a breeze. Mallett said the Internet allows his company to gather customer feedback within hours on newly released products, something that was never possible until firms like his began using the Web.

"We have 350,000 shoppers that

start quoteOne thing I have to do is use a special knife to cut the pizza in a certain way so I can photograph the crust. They then want me to e-mail that photograph in so they can see it.end quote

— Pat Benson,
Mystery Shopper

we monitor," Mallett said. "When a company wants us to, we can send out an e-mail to all of them asking about a new product that just came out and get 30,000 to 40,000 answers in just a few hours."

Few companies need that kind of response, and even fewer can afford it. The cost of a mystery shop visit in the quick service restaurant industry ranges from $25 to $75 each, depending on the company's size and data acquisition requirements. (Benson said each pizzeria visit nets her about $7, plus free food.) Though less detailed, the IVR report is also less expensive: from 50 cents to a $1 each.

Operations that use that data — and Mallett said nearly every medium to large quick-service operation uses mystery shoppers — find it invaluable.

"Our director of operations has said many times, 'I couldn't imagine not having this tool,'" said Hawter. "We can't imagine not measuring the guest loyalty component of our business without something like this."

Topics: CiCi's Pizza , Operations Management , Papa John's , Service

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