Selected Article
Title Undercover shopping a mystery to many
Date Published 08/01/2004
Author Naomi Snyder
Publication The Tennessean

It's 9 a.m. on a recent Saturday and about 40 people are seated in rows of tables at the Embassy Suites Hotel Nashville near the airport, having paid $115 per head to become gold-certified mystery shoppers, the top brass of undercover customers.

They are learning the ins and outs of the latest technology and techniques in clandestine shopping. (Make sure the flash is off on your camera; make entries in a Palm Pilot or go to a restroom stall to take notes.)

"We need to get the word out that this is a serious profession,'' said Cathy Stucker, a Texan who leads the workshops on behalf of the Mystery Shopping Providers Association.

What is mystery shopping?

Companies ranging from retailers to banks to hospitals are using independent contractors to make visits and then report on their personal experiences, sometimes in detailed reports with upward of 200 questions about everything from the cleanliness of a store's or restaurant's floors to whether the server smiled or said, ''Thank you.''

Some shoppers-for-hire are armed with hidden cameras, digital recorders and other devices to keep an accurate record of what happens. Companies use the information to improve service, reward employees and occasionally, to fire them.

Mystery shoppers call on the phone and pretend to be, say, a bride shopping for a wedding gown or a homebuyer looking for a loan. They show up at apartment complexes under the guise of needing a place to live. They walk into stores to secretly jot down prices on behalf of a competing company.

Occasionally, they are hired to do a ''shop'' with the express purpose of seeing if an employee is stealing.

A typical job like that might involve buying something at a convenience store or a bar, then walking away while a private investigator standing nearby observes whether the employee puts all the cash in the register.

Making it better

Seafood restaurant chain Captain D's uses customers as mystery shoppers to evaluate the performance of its restaurant.

It pays as much as $7.50 in meal reimbursement for the job, which involves filling out a report online of some 100 questions.

Matt Gloster, the vice president of administration for Nashville-based Captain D's, said the company takes its mystery shopping forms seriously, but hourly employees rarely get fired because of them. Managers, if their shops show consistent problems, can get fired, he added.

The more than 500 restaurants get shopped on average six times in a month, and the reports are tacked to a bulletin board for all employees to see. Each employee has to sign each report, Gloster said.

''If someone does something wrong, we need to know that, and everyone needs to work on making it better,'' Gloster said.

Each location gets an average score based on their reports ranging from excellent to very bad. Any bad or very bad average scores could keep a store from getting remodeled until managers improve it, for example.

Sales check-up

Beverly Gleason owns Knoxville-based Mystery Shoppers, a company that acts as a go-between for companies looking for mystery-shopper contractors.

She said sometimes, mystery shoppers find illegal activity in the course of a routine job.

One shopper of hers noticed a cashier wasn't ringing up her purchase at a clothing store. She told the company, which investigated and found the employee had stolen $30,000. (Mystery shoppers sign contracts agreeing never to divulge a company's name.)

But employees don't have to do something illegal to get fired.

Teens working at a Carmike theater in Roanoke, Va., were fired this summer for failing to up-sell, or encourage customers to buy more, larger items at the concession stand, according to news reports. The company had used mystery shoppers to check on employees' performance.

John Swinburn, the executive director of the Mystery Shopping Providers Association, said he doesn't think an employee ought to be fired because of a mystery shopping report.

''It may be that someone had one bad day, and that's the only time that happened.''

However, it is up to the company, not the mystery shopper, what to do with the information.

Shopper's remorse

Christine McCrary, a 28-year-old Memphis-area mystery shopper who attended the Nashville gold-certification workshop, said her report once got a server suspended at a restaurant/bar for two weeks, which made her feel guilty.

But most of the time, her assignments didn't result in anybody getting punished.

''Most shoppers recognize that all we're doing is reporting,'' Stucker said. ''Our being there didn't cause the employee to do a bad job.''

McCrary has been paid $100 to play at a casino (she spent about two hours working and a few more hours playing). She has spent a free night in a hotel in exchange for a detailed report. And she said at her busiest, working about 25 hours per week on mystery shops, she made $1,000 in a month.

''You can't be relaxed. You record when you were greeted, how you were greeted, what they said to you when you sat down,'' she said. ''You're observing 5,000 things.''

Julie Petzko, a 65-year-old mystery shopper from Nashville, said she sometimes feels guilty about apartment shopping because she's not really in the market for a place to live, and it takes so much time for an apartment manager or staff member to show a unit.

''They try so hard to sell you this apartment, and you just walk out,'' she said.

Let's pretend

Mystery shoppers such as Petzko come up with pretend scenarios. She visits grocery stores regularly and has to come up with questions that present employees with a problem. For instance, if she knows they don't have a particular kind of fresh fish, she asks for it to see if they will offer her something else.

Like other mystery shoppers, she tries to get employees' names and makes a note if a nametag is missing or hard to see.

The semi-retired Petzko estimates earning $14 or $15 per hour.

Petzko hopes to get into video recording, because those mystery-shopping jobs pay better. Pay can range from $40 to $100 for a ''video shop,'' compared to other routine assignments that pay no more than $10 or $20. (Some restaurants only reimburse mystery shoppers for meals.)

In a videotaped mystery- shopping visit, the customer typically wears a hidden camera under a shirt, with a button for the lens, or conceals it inside a purse.

Thirteen states require both parties to consent to taping (Tennessee does not), according to Michael Bare, owner of Video Eyes, a sister company of Bare Associates International in Fairfax, Va.

His clients pay $200 to $500 per assignment. Bare gets signed release forms from employees ahead of time, putting them on notice that they may be videotaped at work at a later date.

Most of his clients are homebuilders and apartment complex owners who want to videotape salespeople, but more car dealerships and retail customers are paying for the taping as well, he said.

Employees see the tapes and evaluate themselves, coming up with ways to improve. The whole process is meant as positive reinforcement, Bare said.

''The information is basically irrefutable,'' he said.

Jordana Beebe of Privacy Rights Clearinghouse said she had questions about companies using outside contractors with hidden cameras.

Employers have run into problems when they try to record in dressing rooms or bathrooms, and cameras can be used to capture credit-card numbers.

''Why they are allowing their mystery shoppers to do that is simply a mystery,'' she said.

However, there are many ways to monitor employees, and security cameras are common in many workplaces.

''When in the workplace, employees have little expectation of privacy,'' Beebe said. ''They are scrutinized almost the entire time they are on the clock.''

Growth industry

Now, a wider array of companies are interested in doing mystery shops. Gleason said she has gotten more calls lately from health-care companies, such as hospitals, interested in improving customer service. She even lined up a job with a knee-surgery patient who agreed to evaluate her surgery experience.

HCA uses mystery shoppers who pose as job candidates and then give 10- to 20-page reports on how well the human resources department handled them, according to Larry Burkhart, vice president of human resources for the mid-America division of HCA.

Some companies are moving away from paying independent contractors to go undercover, and they're simply getting customers to rate the shopping experience.

O'Charley's, the Nashville-based restaurant company, is switching to random surveys of customers, who get incentives to answer telephone questions about their experience.

O'Charley's is printing random receipts with offers of $3 off, or a free appetizer, if a customer calls a toll-free number and answers a five- or 10-minute survey.

The company's chief support officer, Susan Osterberg, said the new program will cost the company hundreds of thousands of dollars to implement, but the restaurants will be able to get input from more customers.

''We've had a lot of success with the mystery-shopper program, but we just think this is the next step,'' Osterberg said.